Service Contract FAQ : Switching Cell Phone Carriers

Woman using cell phone at cafe

Question: Service Contract FAQ: What if I Want to Jump Cell Phone Ship?

The inspiration for this article on a service contract was prompted by Susan Breslow Sardone. She’s pondering this question: “How can I make sure I cancel my expiring contract before they renew me but in enough time to switch to another carrier?”

Answer: Jumping cell phone ship isn’t always straightforward. In fact, your cell phone carrier has every incentive to make it as unattractive for you as possible. While it’s always your prerogative, you should consider the impact of switching and the best time to do so.

If you're an Android user, the information below should apply no matter who made your Android phone: Samsung, Google, Huawei, Xiaomi, etc.

If you’re compelled to take the leap before your service contract is up, expect to pay an unfriendly penalty. Such an “early contract termination fee” will typically cost $150 to $200. That consequence is often enough to make a person wait who’s wanting to switch.

If you’re interested in avoiding the “I hate to see you go, but if you must, here’s a surly send off” scenario, first determine your contract expiration date. While this certainly sounds obvious, it didn’t use to be as easy to discern as it now is.

Many cell phone carriers allow you to log into your online subscriber account and access that date with a simple mouse click. If you can’t do so or can’t find it, call customer care and they’ll look it up for you. By the way, many service plans come with one- or two-year terms.

The Facts About Renewal

Susan’s question is a great one because it gets to the heart of a matter that’s often misunderstood: renewal. In fact, many service contracts don’t automatically renew. If yours doesn’t at your carrier, you’ll go into cellular service la-la land and become a month-to-month customer.

If that’s the case at your carrier, just wait until your time’s up and then you’re free to leave with no penalties. Many carriers, though, will be proactive about assuring you don’t enter month-to-month land by offering you incentives to renew. It’s not uncommon to receive a $50 service credit per line if you choose to renew.

In reality, many people often avoid the renewal issue entirely because an action in the process forces the contract to revolve. Remember the last time you changed service plans and stayed at your current provider? Yep! They got you then. You almost certainly began your service contract anew.

So we don’t digress and clearly answer Susan’s question, let’s ask it again and respond in four simple steps according to her scenario: “How can I make sure I cancel my expiring contract before they renew me but in enough time to switch to another carrier?”

  1. First, determine when your service contract expires.
  2. Second, determine your early contract termination fee and decide whether or not you want to pay it. That will ultimately rule when you leave.
  3. Third, determine if you automatically renew. If not, you’ll go month to month and you’re free to leave the day your contract is up with no backlash. If so, make sure you call your carrier and let them know you’re leaving. Expect to be “sold” on staying with various incentives. If you still decide to jump ship, notify them within a one-month time window so you can pay your final bill and sever ties cleanly.
  4. When you’re ready to switch, just switch! It’ll only take an hour or two to get live with your new carrier much in the same way you did with your previous company.

Final Tip

As a competitive incentive to leave your current carrier, some cell phone companies will “buy out” your existing service contract by paying your early termination fee for you!

For example, Credo Mobile (which resells service on the Sprint network) will pay up to $200 to snag you as a new customer even if it means leaving while you’re currently under contract elsewhere.