Apple Announcement September 9th: What You Need to Do (Part 2)

Apple Announcement September 9th: What You Need to Do (Part 2)

If you read part one of this post series on the September 9th Apple announcement, you might think it’s all gloom and doom here on Life as a Hat.  You know there’s a new iPhone coming out soon, but you also know that the pricing model is designed to rope you into a quasi contract– you’ll pay a low initial deposit, sure, but you’ll owe your cell phone provider money for months and months to come by way of a hefty monthly bill.

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Gloom and doom are the antithesis of everything Hatters are about, though. I want you to be able to manage your money in a way that gives you the greatest utility for your purchases and lets you keep as many of the hours you trade for wages as you can.  That’s freedom, baby, and the Apple announcement is going to help you get it.

How You Should Take Advantage of the Apple Announcement

You’re going to use this announcement to buy your own phone, and you’re going to take that phone to a pre-paid plan like we talked about.  Here’s where I might lose some of you, though; it’s not going to be the iPhone 6s Plus.  It’s not going to be the iPhone 6 Plus.  It’s not going to be theiPhone Trending Ebay Prices 2015 iPhone 6.  Hatters, I want you to put some serious thought into buying the iPhone 5s this October.

Take a look at the chart to the left.  I’ve priced out the current line up of Apple phones plus a few older models of the iPhone based on their trending prices on Ebay (as of 9/7/2015).  I made a few choices when it came to the phones I selected–namely, I opted towards prices for “unlocked” phones that can be taken to any carrier, and I chose the midrange storage capacity when options were available.  Those choices mean the prices you see might be slightly inflated depending on your needs, but they’re the phones that will work best for the average consumer in the second hand market.

Right now, an iPhone 5s with a 32 GB storage capacity will set you back about $320.  That’s only a little over the $299 most consumers are willing to pay for the latest Apple release, but when you spend your $320 on an iPhone 5S, you aren’t locked into a contract or a payment plan.  You own that phone, and you can take it where you choose, to what deal you choose, at any time.  Choices, my friends, choices.

Here’s where it gets even better.  These prices?  Give them until October, and they’re all going to fall.  The new iPhone will push the 5C and potentially the 5S (depending on how Apple chooses to incorporate the “Plus” options) out of the line up, but those options will stay available on the second hand market.  You can see from the chart that the 4S, a great phone, is down to about $120 because it’s an older model that’s left the line up already.  I don’t know about you, but I would much rather stop paying $90 a month for cell phone service, and take two month’s worth of savings from the $30 T-Mobile plan to buy my very own, no-subsidy, no-contract iPhone.

So why the 5S?

I’m recommending you consider the 5S for a number of reasons this October (I say October because the price drop from the September release won’t happen immediately, but keep your eyes peeled.)

The iPhone 5S offers some of the fan favorite features of iPhone 6 and up like…

  • Fingerprint unlocking
  • 8MP camera
  • IOS 8.4
  • A powerful processor
  • 1 GB RAM
  • ~One day of battery life with medium use

It also offers a few of my own personal favorite perks like…

  • Freedom from bulky monthly contracts
  • More money for your emergency fund/your retirement savings/your dream trip/your home downpayment
  • The pride in knowing that you own your phone, and you’ll take it to the network that gives you the best deal

I’ll be upfront with you.  There are some downsides to choosing a second hand 5S.  Your camera won’t have the upgrades of the 6S, though it’ll still take incredible photos with ease.  You won’t have the slightly faster processing of the 6S, but you’ll still be able to use your device for more than we could have imagined a few years ago.  You won’t have the convenient larger screen for gaming, but you will have a proficient system that will rarely make you wish for more.

I think the perks far outweigh those costs, though, don’t you?

How to Buy a 5S (Relatively) Safely on Ebay

This last portion is for my readers who might not feel comfortable buying a phone second hand.  There is always going to be risk associated with the second hand market, but there are things you can do to mitigate those risks.  When you buy your iPhone 5S, I want you to make sure…

  • There is a clean IMEI number advertised on this listing.  This helps ensure the phone wasn’t stolen and that you’re able to activate it on your own network. It’s important that the clean IMEI is advertised in the listing because it helps ensure Ebay can protect your purchase if you receive a phone that can’t be activated.
  • You pay close attention to the condition description of the phone.  I’m personally comfortable with anything listed from “Good” condition on up; your comfort level might vary.  Do understand that the photos on eBay are often stock pictures, and they aren’t involved in any purchase protection from Ebay.  The condition description is what the seller is obligated to match.
  • The phone is listed as “Factory Unlocked” or listed for use on the carrier network you intend to use. Factory Unlocked will allow you to take your phone to any network, and I personally prefer that freedom.
  • The Ebay seller you choose has plenty of positive reviews from other iPhone sales
  • You make purchase using a method that will provide you secondary protection beyond Ebay–I like to use AMEX because of their great customer service, but PayPal also provides a set of purchase protections.

Got through all that?  You’re ready to take on the Apple announcement this week like a personal finance pro and make it work for your own freedom.

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Apple Announcement September 9th: What You Need to Know (Part 1)

Apple Announcement September 9th: What You Need to Know (Part 1)

Hatters beware. On September 9th, Apple is going to announce the new iPhone 6s–expect a better camera, faster LTE capabilities, and maybe even the ForceTouch technology we saw in the Apple Watch.

Also expect Apple to team up with the big cell phone carriers whose subsidy and payment installment plans rip you off.

What You Need to Know about Apple and the Big Carriers

In the past few months, we’ve seen the big carriers move away from contracts explicitly based around a two year plan.  Smaller players like T-Mobile, Republic, and Straight Talk have influenced consumer consciousness enough that Verizon, ATT, and Sprint know a two year contract is seen as an unpopular option.  Those lofty two year contracts, though, were very good at one thing consumers love; they lowered the initial stocker shock for smart phones like the newest Apple installment.

As most of us know, Apple operates on a tiered pricing system based on release schedule.  Right now, consumers who sign onto a new two year contract could pay $299 for the entry model iPhone 6 Plus (the latest release), $199 for iPhone 6, $99 for the iPhone 5s, or they could get the iPhone 5C for free.

Don’t let the advertising fool you, though.  iPhones were never sold at those price points.

Apple gets away with advertising those prices because the big carriers would subsidize the remaining cost of your phone as part of your two year contract.  You traded your freedom to pursue a better deal for hundreds of dollars that would be spread out month to month within your hefty plan.  It was a win/win for businesses, and, I’ll concede, for those absolutely desperate for the latest iPhone model, but for most consumers, it was a really bad deal.

So what’s changed without two year contracts?

Here’s where I really need you to pay attention.  Very little is going to change in our quasi post contract world.  Expect that Apple will talk about the low entry fees associated with the brilliant new phone we meet this Wednesday.  Apple needs to talk that up because otherwise, the sticker shock of iPhones priced at $800+ would let Samsung hammer in the nails to the iPhone’s coffin.  iPhones needed to be affordable, but they’re an incredibly sophisticated piece of technology.  Apple was never going to give these phones away, but consumers weren’t suddenly going to pay hundreds of dollars more to own them.  Something had to give.

So what did Apple do?  Team up with the big carriers (insert my shock here.)

Rather than selling you a two year contract, the big players in cell service are now going to offer you the opportunity to place a deposit on your phone (hmm, I bet a tiered model starting at $299 and working its way down would do just fine) and allow you the chance to pay the rest of your phone off month to month within a set amount of time.

Are they kidding me? Isn’t this just a two year contract?

No, of course they’re not.  Yes, of course, it is.  It has a different name, it has a slightly different structure, but for all intents and purposes, nothing’s changed at all.  This is business and business is not about your freedom.

So what should Hatters, who want to be free but also love iPhones do?  Stay tuned for Apple Announcement September 9th: What You Need to Do (Part 2) to find out.  Want that post ASAP?  Like our Facebook page to get the quickest notification of when new posts arrive.