At Super Monedero, we aim to provide comprehensive financial insights to the Latino community. Sure, we explore insurance, bank accounts, credit cards, and loans… but we can’t forget about the little things that can make a big impact on your household budget. One of the biggest “little things” is your monthly cellphone bill.

In this article, we will explore the types of cell phone plans that are available, what you should consider when signing on the dotted line, and some of best cell phone plans available for Latinos.

The Basics

At the core, cell phone plans are made up of three components: talk time, text volume, and data volume. Increasingly, the data component is becoming more and more relevant - as the transfer of data is what powers mobile apps, e-mail, and access to the worldwide web. This data component of a cell phone plan is especially important for Latinos, as Latinos are a leaders in accessing the web from a smartphone. In 2015, it was estimated that 94% of Latinos access the internet using a smart device at least occasionally. 1 Additionally, Latinos are much more likely to research a health condition using a smartphone that other Americans. 2

Types of Cell Phone Plans

These three major components (talk, text, and data) are bundled in various ways by cellular plan providers, and there are five types of plans which provide different quantities of each. Here are some criteria to determine what type of plan is right for you.

The Basic Plans - These plans are designed for the basic user. You like to text, you like to talk, and you might cruise the web from time-to-time using a smartphone. You don’t need much, and the bare minimum will likely suffice.

Family Plans - Your entire family is using one cell phone plan. There might be two adults, two kids, and even some extended family who will be covered. You need to figure out the cheapest, and most effective, way to give them all coverage. Many times, cell phone carriers will provide discounts for “bundling” users under one plan - just as insurance companies will do with home and auto coverage.

Big Data Plans - You rely heavily on your smartphone and are constantly using data to keep up on social media, watch videos, or to stream music. You may even be using your smartphone as a mobile wifi hotspot to power a laptop or tablet. Data is critical, and you need all of it that you can get.

Prepaid Plans - Most cell phone plans require a year-long contract. If you are thinking about moving, or simply don’t like being locked into one provider, a prepaid plan might be the right fit. These plans are generally geared toward the basic user in terms of the talk, text and data quantities provided.

International Calling Plans - Many Latinos use their cell phones to keep in touch with family members in Mexico, Central America or South America. These plans are specifically designed for international calling.

When it comes to your cell phone usage - which one of these plans best describes you? Carefully consider your lifestyle, needs, and wants before you begin looking for a cell phone plan. By having these items in mind, you can look for the plan that will best service your needs and avoid buying more services that you, and your family, are realistically going to use.

What to Consider

Here is where things can get a bit tricky. While these five major types of plans are offered throughout the United States, there are several things you should consider which can help you really nail down the type of plan, and provider, that is right for you. Let’s cover each of this items, in detail.

How Is The Coverage In Your City?

These days, it seems like network providers are constantly advertising the size and reliability of their coverage. You can’t turn on the TV without seeing Sprint, Verizon, T-Mobile and AT&T going head-to-head over who really is the top dog. While coverage is important, it’s critical to understand that the best network can vary substantially based on the state or county you live in. Bottom line - don’t let the hype of advertising sway your decision.

To help with this, it can be useful to consider studies like the one performed by PC Mag each year. Their approach is simple: they drive to 30 U.S. cities and measure the download speed, upload speed, and reliability… among other categories. With how many of our readers live in the Southwest, we have chose to highlight the results of this study in Los Angeles and Houston.

Los Angeles AT&T 4G Sprint 4G T-Mobile 4G Verizon 4G
Avg Download 17.54 Mbps 13.42 Mbps 20.00 Mbps 28.90 Mbps
Avg Upload 9.85 Mbps 7.08 Mbps 19.70 Mbps 24.46 Mbps
Speed Score 77 68 86 98

Data shown is from PC Mag’s Fastest Mobile Networks 2016

In Los Angeles, Verizon was the clear winner in terms of signal strength. But look at this same comparison for Houston.

Houston AT&T 4G Sprint 4G T-Mobile 4G Verizon 4G
Avg Download 25.49 Mbps 30.83 Mbps 18.33 Mbps 17.56 Mbps
Avg Upload 13.08 Mbps 10.36 Mbps 25.77 Mbps 11.06 Mbps
Speed Score 92 81 82 74

Data shown is from PC Mag’s Fastest Mobile Networks 2016

The point of showing this data is not to highlight the winner and losers within Houston and Los Angeles - it is to highlight the variability of cell phone coverage based on your location. No matter how good a plan sounds, do some basic research to determine how reliable (and fast) the service is in your area. This doesn’t always require detailed reports - word of mouth from family and friends can be powerful.

Best Pre-Paid Plans

As we mentioned, there are prepaid plans available for Latinos looking to operate outside of a contract. In most cases, cell phone contracts are one or two year contracts. When you sign up for a cell phone plan, you are agreeing to be a customer and pay the monthly dues for the entire length of the contract. Exciting the contract early can come with significant fees, sometimes nearing $500.

It’s for this reason that prepaid plans have become so popular. You pay upfront for talk, text, and data, and once you have used your plans allotment you are free to switch to another provider. T-Mobile and Cricket wireless both provide highly competitive prepaid plans.

  Cricket T-Mobile
Price Per Month $40 $30
Data 3GB 5GB
Talk and Text Unlimited talk and text “100 minutes of talk and unlimited text

For many prepaid plans, once you have surpassed your data limit the company will significantly slow download and upload speeds. If you don’t use much data and are looking for a cheap plan which doesn’t require a contract, a pre-paid phone can be a great route to go.

Do you have internet access at home? If not, consider an unlimited plan.

Compared to the average American, Latinos are the most likely to use a smartphone as the primary way to access the world wide web. In fact, 23% of Latinos own a smartphone but do not have high speed internet at home. This compares to 15% of blacks and 9% of whites. 3 For this segment of the Latino population, it is likely that the smartphone is critical to surfing the web, watching videos, looking for work, and catching up on current events. For this reason, it is crucial, that a phone plan provide a reasonable data coverage, in addition to talk and text allowances.

If your smartphone is your gateway to the world wide web,considering getting an unlimited data plan. This will allow you to surf to your heart’s content - without worrying about overage charges or data fees. Boost and Sprint both offer competitive unlimited data plans, with monthly coverage starting at just $50, and $65, respectively. With an auto pay discount, you can even shave $5 off your monthly bill.

When looking at an unlimited plan, it is especially important to understand what limitations exist. While the data transfer may be unlimited - there may be significant limitations on the speed with which the data is transferred. Some providers will “throttle” your service during peak hours or even slow down your service if you utilize it “too much” during a given month. As always, read the fine print and understand all of the limitations that apply.

International Service

Currently, there are a huge number of services which can make international calling a breeze. Skype, Facetime, and even Facebook all provide video calling services which are many times free or come with very little cost. What if your abuela doesn’t have a computer or would prefer a simple phone call? It’s this type of situation which might require a true international calling plan.

In general, T-Mobile is considered a leader in providing international roaming coverage. The T-Mobile One plan provides 2G data coverage and unlimited texting in over 140 countries. Talk costs are just $0.20 per minute.

A second option to consider is Sprint. With their Sprint Open World plan you get unlimited talk and text in the majority of North and South America, with 1GB of data provided. If you are not a big texter and are not going to be using your data abroad, Sprint Open World may be the best fit.

Prepaid options do exist for international calling, with many Latinos using services like Project FI or MetroPCS. If speed is what you need, consider ProjectFi. If you are strictly looking for a prepaid carrier who offers roaming outside of North America, take a look at MetroPCS. As always, shop around and get a number of quotes before buying.

Final Thoughts

We’ve covered a lot of the cell plan market in this article. Regardless of the type of plan you choose, take the time to ask friends and family members what their experiences have been working with a cell phone plan provider. Not all plans are created equal, and you can save serious cash on a monthly basis with a little research on the front end. As always, Super Monedero will be with you every step of the way.