Can you get a decent trade-in value with prepaid, or is postpaid a better deal?

If you’re new to the prepaid world or considering switching from postpaid, you might wonder how trade-in values compare across the two camps. In most cases, you’ll get a higher offer with postpaid trade-ins, but that doesn’t mean you can’t still get a good trade-in offer as a prepaid customer. Let’s take a quick look at the biggest differences between prepaid and postpaid trade-ins and what to look for if you are interested in prepaid service but want a good trade-in offer.

It’s true that big carriers are much more likely to offer $800, $1,000, or even more for a trade-in. The reason for these higher prices is that most postpaid brands treat trade-ins a lot like the auto industry does. That means you’ll often get a trade-in deal that’s worth more than the device you’re offloading. Verizon, AT&T, and T-Mobile would prefer to lure you into a 24–36-month device payment plan, which in turn will keep you on a mobile plan for at least that long. Not only does this ensure high profits on their end, but it also makes the deal look more enticing to the customer.

In contrast, prepaid trade-ins tend to be closer to resale value and are often a bit lower than you’d get if you sold them directly on eBay, Swappa, or used another similar method. If you are considering trading in a phone to a prepaid provider, there are a few things you should do, or at least consider, first:

• Research the phone’s value independently. Before you even get a quote, you’ll want to hit up online resellers and see what rates they go for. This will help you know how much you could get if you decided to list it yourself, and also help you understand if a quote is good enough or not.
• Understand that the quoted value isn’t a guaranteed value. In the postpaid world, you’ll often be offered “up to $X,” and unless the phone is significantly degraded, you’ll often get the whole amount or darn close to it. In the prepaid world, many providers’ seemingly generous quotes are for a phone in mint condition, and prepaid carriers tend to be much less forgiving here. Even small cosmetic issues can end up slashing your quoted value in half.
• Not sold on a specific provider? Do your homework here, too. While most prepaid carriers offer relatively low trade-in values compared to postpaid, there are a few exceptions. Sometimes, premium prepaid providers like Cricket Wireless, Metro, or Total Wireless will have special promotions that give you extra value for your trade-ins. Likewise, Google Fi has occasionally offered “any condition” trade-in offers for those interested in newly launched Pixel devices.

After doing your homework, you might find that you’d still get a better trade-in value by sticking to postpaid. Don’t let this fool you into thinking you’re getting a better value overall.

The big three carriers know how to lure you in with all sorts of good “deals” like free phone promos, often even without a trade-in required. If you do need a trade-in for a carrier deal, you’ll get higher values that easily outcompete prepaid trade-in offers. Whatever package they offer, expect the same thing: the long-term costs will outweigh short-term savings.

Earlier this year, we did the math on how “free” a free phone was, and the main takeaway was that you might pay more upfront for a phone, but long-term, the monthly savings on prepaid service will result in a better deal. We’re not talking about chump change either, in many cases prepaid would save you anywhere from $175-$1000 or more. As you can imagine, the same story applies to trade-in values. Even if you keep your old phone and buy a new one, you’ll probably still often end up with a better deal long-term with prepaid.

If you really want to maximize your earnings? You’ll want to resell your phone directly and pair it with a prepaid service. I highly recommend Swappa, though there are plenty of other resellers out there. Don’t want to go through all that work? Another option is to consider trading the phone into a third-party retailer.

While the super high trade-in values advertised by third-party retailers are often contingent on activating a line with one of the big carriers, many retailers like Best Buy and Amazon do accept trade-ins that aren’t tied to carrier activations, just with rates that will be much closer to the offer you’d get with prepaid. The good news is retailers aren’t usually quite as picky as some prepaid carriers, and so what you are initially quoted is more likely to be what you get once it’s inspected.

You also have the option of trading in your device directly to a phone maker like Apple, Samsung, or Google. While these rates are also typically much closer to the standard resale value of the device in question, sometimes they will run special promotions that give added value to your trade-in. This is more common once a new model has been out for a while, or for those who jump quickly on a pre-order deal when a new phone rolls out.

Regardless of what you decide, the big takeaway is that it’s important to do your homework and understand that just because a trade-in deal looks great at face value doesn’t mean you’ll actually save much or any in the long run.