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What each route really costs
Type in the figures you are being quoted. Both options are totalled over the same number of months, so the comparison is fair. Nothing you enter is saved or sent anywhere.
Buy the phone outright
One bundled contract
Buy outright and add a SIM£1,187.00£49.46 a month over 24 months
One bundled contract£870.00£36.25 a month over 24 months
The contract is £317.00 cheaper over 24 months — about £13.21 a month.
These totals are built only from the numbers you typed. They leave out phone insurance, any excess-usage charges and the cost of replacing a lost or damaged handset, and they assume you keep paying for the SIM for the whole period.
The two routes rarely feel the same even when the totals are close. Buy the phone outright and it is yours from day one: after the SIM's first 30 days you can change network, drop to a cheaper plan or stop altogether with a month's notice. A bundled contract fixes one payment for the whole term, which some people find easier to budget, but leaving early normally means paying the remaining months in full.
Check the handset price with the retailer and the plan price with the network before you buy — any mid-contract price rise must be shown in pounds and pence when you sign up, and trade-in offers come with their own conditions. The figure at checkout is the one that counts.
How the two routes are compared
Buying outright is the handset price less any trade-in, plus the SIM only plan you pay each month for as long as you keep the phone. A bundled contract is its upfront payment plus the monthly price for the whole term. Both are added up over the same number of months here, because comparing a year of one against two years of the other tells you nothing.
Spreading each total across the months gives a true monthly cost — the figure that is worth comparing with the price you see advertised, since the advertised monthly price on a contract rarely includes the deposit.
Why the totals can look close but feel different
Buy the phone outright and you own it from day one. Nothing stops you moving to a £6 SIM the following month, going back to a bigger allowance for a holiday, or leaving the network entirely with a month's notice if your plan is a rolling one. A contract fixes one payment for the whole term, and the phone is not yours to sell until the agreement ends.
That flexibility is what usually makes the outright route cheaper over three years, because the second and third years cost only the SIM. The trade-off is having the money for the handset up front, and arranging your own cover if you want insurance on it.
What to check before you commit
Read the contract for three things: the upfront payment, whether the monthly price can rise mid-contract (since January 2025 UK networks must show any rise in pounds and pence when you sign up), and what leaving early costs. On most fixed-term phone contracts, terminating early means paying the remaining monthly instalments in full, so the advertised monthly price is not the exit price.
On the outright route, check the retailer's price on the day, whether the phone is SIM-free and unlocked, the warranty, and any conditions on a trade-in such as the grade your old phone will actually receive. Trade-in quotes are provisional until the phone is inspected.
When each route suits
A bundled contract suits people who want a single predictable payment, no large deposit, and a handset upgrade at the end of the term. Buying outright suits anyone who already has the cash, is happy to pick their own SIM, and would rather not be tied to one network for three years.
If the difference between the two totals is a few pounds a month, decide on flexibility rather than arithmetic. If it is tens of pounds a month, the maths is making the decision for you.
Frequently asked questions
Is buying a phone outright always cheaper?
Not always. Networks discount handsets on long contracts and add trade-in bonuses, so a bundled deal can beat an outright purchase over the same term. The calculator shows which is cheaper on the figures you are being quoted.
What does the upfront payment do?
It lowers the monthly instalment. A deposit is part of the total you pay, which is why a contract that looks cheap each month can cost more overall than the same phone bought outright.
Can I leave a contract early?
You can end it, but on most fixed-term phone contracts you must pay the remaining monthly instalments in full, so the true cost of leaving is close to the whole term. Check the termination clause before signing.
Do these totals include insurance?
No. Phone insurance, excess charges and any replacement costs are left out, so add them to both sides if you are comparing quotes that include cover.
Are my numbers saved?
No. Everything stays in the page you are looking at and disappears when you reload it. Nothing is sent to a server or stored.
Official sources
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Listings are dated snapshots of providers' own pages, not live prices, and CompareDirect does not sell the products we list. We are not a credit broker or lender and give no financial advice.
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