Are you thinking about buy a new smart phone? With so many options available—outright purchase, financing, and leasing—it can be difficult to choose the best method for your needs. Each option has its own advantages and disadvantages, so it’s important to find which one is best for you.

In this article, I’ll explain what financing is, outline the different types of financing available, and provide tips to help you choose the best option for your needs. Plus, I’ll share how you can maximize savings on a new device by trading in your old device.

What is financing?

Financing lets you buy a smartphone now and pay for it in monthly installments, usually over two years. Rather than paying full price up front, you can manage your budget with smaller monthly amounts.

Unlike buying an unlocked device outright, where you pay the entire price up front, financing allows you to spread the cost over a certain period. This can make high-end smartphones more accessible, allowing you to choose a device that suits your needs without the burden of a large up-front payment.

Type of financing

Best Buy Canada offers two main types of financing:

Stick to that plan

With the Keep it plan, you finance the device for 24 months, and once all payments are made, the phone remains yours. Monthly payments stop as soon as the device is paid off, lowering your bill.

Bring back the plan

Also known as a lease, a Take it back plan lets you pay for your phone use with the flexibility to decide if you want to keep it at the end of the term. When the plan is finished, you have three options: return the phone, upgrade to a newer model, or pay the remaining amount to keep it. This option usually has lower monthly payments, which is perfect if you want to upgrade your phone every few years.

How financing works

There are a few things to keep in mind when it comes to financing:

• Down payment: Whether a down payment is required depends on factors such as your credit check and the price of the phone. In some cases, if your credit limit doesn’t cover the full cost or the phone is very expensive, the carrier may require a deposit.

• Monthly payments: Once the required down payment or taxes have been paid, the remaining balance is divided into equal monthly installments over 24 months. This amount is usually added to your monthly wireless bill.

• Interest rate: Most financing plans offer 0% interest, meaning you only pay the retail price of the phone.

• Loan term: Financing terms are usually set at 24 months, which is the maximum allowed for phone financing in Canada. After that, you completely own the phone unless you use the Bring it back plan, in which case you have the option to upgrade, return, or buy the device.

How financing affects your phone bill

Your monthly bill will include two separate charges: the cost of your wireless plan and the phone payment. This clear breakdown helps you see exactly what you’re paying for each. While monthly phone payments remain consistent, be aware of the initial activation fee (usually on the first bill) and upfront taxes, which may vary by carrier.

Financing also ties you to a specific carrier or retailer for a full 24 month period. If you choose to end your plan early, you may have to pay off the remaining balance.

Benefits of financing

• Affordable payments: Financing breaks down the total cost into manageable monthly payments, making it easier to budget for a new phone.
• Access immediately: Financing lets you get the newest device outright, without having to pay full price up front.

Potential weaknesses

• Commitment: Financing requires adherence to a payment plan for the full term, which can be challenging if your financial situation changes.
• Down payment and credit limit: Depending on your device and credit profile, a down payment may be required, or your credit limit may only allow you to finance one device. However, if you financed through a carrier and have credit remaining, you may be able to finance additional devices.
• Activation fee: An activation fee may be added to your first bill, resulting in your initial payment being higher than the standard monthly amount.

Choose the right financing option

Here are some tips to help you make the best choice:

• Budget wisely: Make sure your monthly payments match your overall expenses.
• Understand the requirements: Check to see if there is a deposit or taxes due up front, and be aware of potential fees if you want to end the plan early.
• Think about upgrading: If you want to update your phone regularly, the Bring it back plan may be the best choice. However, if you prefer to use your phone long term, the Keep it plan may be a better choice.

Trade in your old device at Best Buy

Best Buy Trade-In Program lets you trade in your old device for a Best Buy gift card, which can help offset the cost of your new phone. This is an easy way to recycle responsibly and reduce e-waste. Here’s how it works:

1. Check the value of your device: Use Best Buy online tool to check the estimated trade-in value of your device.
2. Take it to the store: Visit a participating Best Buy location with your device.
3. Receive gift cards: You’ll get a gift card based on the value of your device, which can be applied to new purchases or used on other items.

Frequently asked questions

Can I trade in my old phone to buy a new phone?

Yes! Best Buy’s Trade-In Program lets you trade in your old device for a gift card, which can reduce the amount you need to finance.

What happens if I miss a payment?

Missed payments can result in late fees and affect your credit. Make sure to make payments on time.

Can I finance an unlocked phone?

Yes, financing is available for unlocked phones through Best Buy partner Fairstone. All phones in Canada have been legally unlocked since 2017, so you can use them with any carrier.

Still have questions about financing?

Whether you choose to finance or buy the device outright, Best Buy’s Blue Shirt advisors are ready to help you find the best plan for your needs. Shop online or visit any Best Buy location to get started, and don’t hesitate to ask a Blue Shirt advisor about financing options, promotions or current offers.

Ready to get started?

Whether you want to finance a smartphone or buy it outright, Best Buy offers flexible options to fit your needs and budget. With helpful tools like the Trade-In Program and guidance from knowledgeable Blue Shirt advisors, the process is simple and easy. Explore your financing options today and take advantage of the latest technology with a plan that works for you. Visit Buy the Best Mobile Phones online or in-store to get started!