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Buying an iPhone 5 on contract vs buying SIM-free: there’s not much in it

The iPhone 5’s out, but if you’re buying one can you save cash by going SIM-free? The answer’s yes, but the difference isn’t as big as you might expect.

Take Orange: the 32GB iPhone 5 is £219, then £36 per month over two years. That’s £864, so the total cost of ownership over two years is £1,083.

SIM-free from Apple, the same phone is £599. The pick of Three’s SIM-only deals is £12.90 a month, so that’s £309.60. Total cost, £908.60. There’s a difference, but over two years it’s not a huge amount: it’s just over £7 per month.

Remember too that you can get some cash back by trading in your existing phone (shop around though – trade-in prices vary widely) and you might be able to wangle a discount if you upgrade with your current provider.