Apple's just-announced iPhone X is its most expensive phone ever.
But you don't have to take an immediate $1,000 — or more — hit to your wallet to get the X. Instead, you can take out what is essentially an interest-free loan via Apple's upgrade program and pay off the device in monthly installments.
Apple's plan also makes it easy to swap out your old iPhone for the latest model each year.
As you can see, you'd pay about $50 a month under Apple's plan for the base 64 GB iPhone X. You'd pay about $56 a month for the 256 GB model.
Apple allows customers enrolled in its upgrade program to swap out their phones for a new one after they make 12 months of payments. That allows them to get a new phone and upgrade it without ever having to pay any big upfront costs.
After a year, someone who purchased the 64 GB iPhone X under Apple's plan would have spent less than $600 paying off the device. For the 256GB iPhone X, a year's worth of payments equals only $675 compared to the device's steep $1,149 full cost.
Of course, there's a catch. Because Apple's upgrade plan works something like a combination between a lease and a two-year loan, you'll likely end up paying just as much or more under it as you would if you bought a phone outright.
Whenever you swap out your phone for a new one, you're committing to pay the full cost of that phone over the next two years. You can swap out the phone every year, but then you're essentially committing to pay Apple a monthly charge in perpetuity. If you buy a phone outright, you don't have to spend anything more.
And when you swap out your phone, you lose whatever investment you've made into the old device. Apple essentially applies the value of the phone to your outstanding balance. But the old phone will likely be worth more than your outstanding balance, and Apple gets that windfall.
By contrast, if you pay upfront for the phone, you can sell it on eBay or trade it in elsewhere and get some credit for its value. That could help significantly reduce the cost of upgrading to a new phone.
Still, Apple's program allows consumers to easily upgrade on a yearly basis and at least save money upfront. They may not save much — if anything — over the long haul, but they also don't have to deal with selling a device on eBay or Craigslist to recoup some of their investment.
Experts generally consider Apple to have one of the best monthly-payment program for buying iPhones. The company's AppleCare warranty, which costs $200 by itself and provides greatly discounted costs of repairs for accidental damage, is included with the program.
If you don't want to buy a new iPhone 8 or X through monthly payments, here are their total retail prices:
- iPhone 8, 64 GB: $699
- iPhone 8, 256 GB: $849
- iPhone 8, Plus 64 GB: $799
- iPhone 8, Plus 256 GB: $949
- iPhone X, 64 GB: $999
- iPhone X, 256 GB: $1,149
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