If you're the type that has to have the latest and greatest phones on the market, but can't afford to buy phones outright, AT&T's Next plan might be the right fit for you.

Instead of paying the full regular price for that new phone, AT&T will divide the cost of the phone over 12 to 30 installments (depending on your credit standing) so you can get that new phone today and simply pay for it through an added charge to your monthly bill. But beware of the fine print.

I can get a new phone without putting money down?

Only if you have "well-qualified credit" according to AT&T's standards. If you're an existing AT&T customer, that would mean you've always paid your monthly bills in full and on time. They clearly state that only well-qualified customers qualify for $0 down, and even state that not everyone qualifies for even the down payment Next plan option. You probably know whether you're in good standing with AT&T or not.

I qualify for the $0 money down option. Should I do it?

It really depends. Let's look at how the cost breaks down for all the different options (excludes the cost of your wireless plan):

AT&T Next 24 plan

(Buying a phone priced at $650 with no money down.)

Full price of the phone is paid over 30 installments: $650 / 30 = $21.67 each month.

24 pay installments until option to upgrade: $21.67 x 24 = $520.08 paid for phone.

AT&T Next 18 plan

(Buying a phone priced at $650 with no money down.)

Full price of the phone is paid over 24 installments: $650 / 24 = $27.09 each month.

18 pay installments until option to upgrade: $27.09 x 18 = $487.62 paid for phone.

AT&T Next 12 plan

(Buying a phone priced at $650 with no money down.)

Full price of the phone is paid over 20 installments: $650 / 20 = $32.50 each month.

12 pay installments until option to upgrade: $32.50 x 12 = $390 paid for phone.

AT&T Next 12 plan

(Buying a phone priced at $650 with 30% paid as down payment.)

Down payment at original time of purchase: $195.

Remaining price of the phone paid over 28 months: $455 / 28 = $16.25 each month.

12 pay installments until option to upgrade: $16.25 x 12 = $195 paid through installments.

Total amount paid before upgrade: $390

Let's break it down

On paper, it might make sense to go with the AT&T Next 24 plan if you qualify because it's a cheap monthly charge with no money down. But, waiting 2-years until that trade-in option to upgrade could come back to bite you. Consider this from the AT&T website:

Your trade-in must be in good physical condition and fully functional to qualify. This means:

  • It must power on and off.
  • The screen must be intact, free of any chips, and function properly.
  • The device must be free of breaks or cracks.
  • The battery must be included.
  • The activation lock has been disabled (for example, Find My iPhone).

Now, you know better than anyone else how well you take care of your phone. If you're accident prone and always seem to damage your phone, consider whether your phone can survive up to two years of use and abuse while remaining in good physical condition as outlined by AT&T.

On the flip side, if you're able to afford the 30% down payment to start, you'll end up paying less overall before reaching the trade-in upgrade period — including a considerably smaller month charge than compared to the AT&T Next 12 $0 money down option), and only have to worry about keeping the phone in good condition for a year before deciding whether to upgrade.

You'll also only be available to upgrade if your account is still in good standing. Let's say you decide to go for the AT&T Next 12 plan with no down payments, but have a tough time paying on time once in a while. That might affect your standing as a well-qualified customer, and therefore affect your ability to upgrade, which would mean you'd be left paying off the remainder of your phone.

What happens if I cancel my AT&T service?

You'll be charged the remaining cost left on the regular price for the phone at the time you signed up.

But I won't have to pay the remaining balance of the phone if I upgrade?


But you'll have to send the phone back in and start the whole deal over with a new phone, including the optional down payment on the new phone.

What if I just want to keep the phone?

You don't have to trade in and upgrade the phone. If you absolutely love your phone and want to keep it, you can just complete the remaining payments on the device and then it's all yours.

Alright, but are there any hidden fees?

Oh, you better believe there are. Beyond the standard government fees and service charges, they mention a "Restocking fee" of $35 and an upgrade fee of $15.

What happens if I mail in my phone for trade-in, and AT&T determines it doesn't qualify.

Here's the really confusing part that might be a total deal breaker for some. According to the language on their site, say you send in your phone, and they say it's too damaged, or you forgot to unlock it even. Not only will you be charged for the remaining balance on the phone, they also won't send the phone back to you. Read for yourself here, but of specific note under "After you ship":

Your phone should meet all the following standards (see above), or you may be charged the remaining outstanding balance on your AT&T Next instalment agreement:

Then there's this note:

*AT&T, its vendors, and suppliers will not be able to return any device that you trade-in.

So, based on that logic, if you were to send your phone in for a trade-in, but AT&T determines it does not meet their criteria for the trade-in, they'll charge you the outstanding balance of the full price of the phone and keep the device. Meaning you've paid the full price for a phone you've used for a year, maybe two, and have nothing to show for it.

Yikes. And on top of that, you'll only find out once you've locked into another AT&T Next plan with a new phone to start paying off. Again, this is all based off of the language on the AT&T site, so don't try to trick AT&T by sending in a damaged phone or else you'll end up paying for it — literally.

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