What You Need to Know About the True Cost of an iPhone

Choosing an iPhone and the Right Plan for You

Person holding an iPhone 7
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Learning how much an iPhone costs isn't as simple as looking up the listed price for Apple's latest iPhone. That's because the cost of buying an iPhone depends on several factors and because you need to account for the cost of the monthly service, which varies based on your plan. So, figuring out how much an iPhone costs requires some math.

The Cost of the Latest iPhones

Buying an iPhone without being tied to the any kind of contract allows you to pay for your service month to month and switch to other compatible carriers whenever you want. This option offers you great flexibility, but it also means that you have to pay full price for the phone upfront. In this scenario, the phone can be yours for anywhere from US$449 (for a basic iPhone 7) to $1,449 (for the highest-end iPhone XS Max), depending on the model you want.

In late-2018, the price breakdown from Apple looks like this:

  • iPhone XS Max: $1,099 (64GB), $1,249 (256GB), $1,449 (512GB)
  • iPhone XS: $999 (64GB), $1,149 (256GB), $1,349 (512GB)
  • iPhone XR: $749 (64GB), $799 (128GB), $899 (256GB)
  • iPhone 8 Plus: $699 (64GB), $849 (256GB)
  • iPhone 8: $599 (64GB), $749 (256GB)
  • iPhone 7 Plus: $569 (64GB), $669 (256GB)
  • iPhone 7: $449 (64GB), $549 (256GB)

Most carriers offer a monthly payment plan when you purchase a new iPhone from them, but you must stay with the carrier until the iPhone is paid for or else pay the balance due before you change to another carrier. Alternatively, if you want to buy your phone in installments, but not be stuck to a phone company, check out Apple's iPhone Upgrade Program.

Carrier Subsidies Aren't Going to Return

It used to be that iPhones cost much less — sometimes as little as $199 — for the latest model, because phone companies paid part of the cost of the phone to entice you to use their service. Not anymore. In recent years, the major cellular phone carriers have done away with subsidies that allow customers who sign a two-year contract to pay significantly less for their iPhones. It's very unlikely that the subsidy system will return, so expect to pay full price for your iPhone from now on.

That said, when new iPhone models are released, major carriers including AT&T, Sprint, T-Mobile, and Verizon will sometimes offer reductions in the cost for the latest iPhone if you trade in your older model iPhone.

Regional and Prepaid Carriers

You can pay a little less than the sticker price for the iPhone — about $50 in most cases — if you buy it through one of the smaller, regional carriers that offer the phone in some parts of the U.S. These carriers don't always have the latest models, have more-limited monthly plans, and their service tends to be focused specifically on smaller, rural areas, but they are an cost-saving option for some users.

Monthly Plans

After you purchase your phone, you should factor in the monthly cost of the phone and wireless data service provided by the phone company you choose.

Monthly iPhone plans typically include costs for data service, calling, texting, and other services. Expect to spend around $100 a month with major carriers for the services that most people use.

With prepaid carriers, plans are much cheaper, generally running closer to half the price offered by the major carriers, but data connections are often slower or have their fastest speeds limited based on how much you use. With those companies, expect to spend closer to the $50 to $60 range for calling, texting, and data.

Other Costs

You don't want to spend hundreds on a new iPhone and then toss it in your purse or pants pocket without a protective case. Plan to put a case on the iPhone as soon as you get it. Many protective cases are in the $40-$100 range.

The iPhone comes with Apple's standard warranty, but you may want to extend that protection with an AppleCare+ extends warranty available directly from Apple. The price of AppleCare differs based on your model — expect to spend $100-$200 — for two additional years of coverage.

Lots of other companies offer iPhone insurance, but we recommend against it. Find out why in 6 Reasons You Should Never Buy iPhone Insurance.