I’ll start out declaring near total ignorance about almost everything about cell phones. For various reasons (medical and social) neither I nor my husband have ever had cell phones, and I’ve just never read up on them much.
But a currently running commercial for some company’s plan has roused my curiosity. In the commercial, a group of about 4 twenty-something people are planning to sign up with (some company)'s plan which will get them each a new cell phone for some (round number, maybe $25 each per month?) charge. Not explicitly said, but I think it’s implied these people are unrelated, just friends.
So… how does this work financially between the group? Is a single person chosen to get the bill/pay it, and then be reimbursed (or not) by the others? I can see it working easily enough in close families, especially parents and their children. So they have to pay the phone bill for the kids? Well, they already pay the housing rent and electric bills and food and what all, so not a change.
Or does the company actually bill each person separately? In which case, why are they offering a discount for the group? They’re no saving anything administratively.
And, does this mean any given person simply can’t incur any additional charges, like for using the phone more than a set amount? For example, if Mary decides to stream 20 years worth of some TV show, it has no effect on the month’s bill?
If it does raise the bill, is the official bill-ee informed of who caused the additional charge, and for what?
What happens if Bob decides not to chip in his share this month? Is the bill-ee stuck with covering it?
I’ve seen enough Reddit-type arguments over splitting restaurant tabs and such that I’ve got to imagine similar hassles with shared phone accounts, but I’ve never read about one.
I assume it’s simply a favourable layaway plan for the phone purchasers, available only if you get four interested parties.
The rest is absolutely straight up the regular thing. Each get a number, and an account, and are responsible for their own bill. Period.
Now if one person defaults in someway it doesn’t mean the others are responsible, I can’t imagine how that would even work? Perhaps the ‘great’ deal on the phones evaporates or gets less ‘great’ each time one of the four default maybe?
It totally depends on the particular provider and how they bill. Usually (but maybe not always) one person gets billed and it’s up to them to collect from the others. I’d imagine deadbeats would get dropped from the phone (and maybe friend) group after a while.
I share a bunch of plans (cell phone, streaming, games, etc.) with relatives. We just Venmo each other once a year for the estimated bills, or we pay for different things (one person pays for Netflix and another for Max or whatever). A little overage here or there doesn’t get noticed, but if someone suddenly wants a new phone, that has to go through the account manager anyway and they usually settle up then and there.
The benefit for the company isn’t just in consolidating billing, but keeping you on their network instead of another.
4 people paying $20 each is still better than than one person paying $50 and the others not being customers at all.
It’s unclear to me whether the OP is asking how people share bills, or is asking about how that particular (unidentified) cellphone company administrates this particular (unspecified) deal.
When I was in college in the 1970s over the 4+ years I shared various apartments with various other groups of 2 to 4 guys. At each location we had one landline and one bill in the name of one person. Sometimes it was me, sometimes it was one of the other guys. Everybody chipped in equally on the basic charges. Back then long distance cost real money so we’d itemize out those charges.
And yes, we did end up with one deadbeat one semester. Bastard.
I’ll take a swing at this, though please be aware, this is based on my experience with T-Mobile as a user and employee (still a user, not an employee) and it varies dramatically from carrier to carrier, plan to plan, and changing legal requirements over the years.
In general (outside certain corporate/business plans) the entire contract is in ONE person’s name. Only that person can authorize changes to the policy (more or fewer options, purchase phones, etc.). Technically anyone with the contract information is allowed to make a payment (partial or full), request general information and tech support, and there are generally ways to add additional people to the plan with authorization to make changes. More on this later.
Most plans these days have some variant of “unlimited” use, for calls, texts and data. Data is often subject to what is called prioritization, where extreme usage outliers (constantly being redefined) but normally top 2% of national users, will be throttled (they don’t call it that, but it’s that) during times of peak use of the network. So that 20 year streamer will likely find their speeds all but unusably slow during peak hours (morning commutes, lunch, pre-dinner) but should still have usable speeds early the morning and later at night. Plans that DON’T have unlimited handle it in various ways. You may get a note saying you’re out of data and to purchase additional to continue to use the internet, or you may get charged (normally a LOT) for everything over the plan.
There are lots of other things that can contribute to overages. International calls? Separate (Okay, for T-Mobile, historically the plan had the same coverage for US/Canada/Mexico) per call rates. Using the phone internationally? Same. Using data internationally? Same. Using your phone on a Cruise Ship, OMFG, so many charges. Bringing us to:
Generally the bill-ee will get a notification for common circumstances (overage of data), and normally gets a notification that they’re responsible for additional costs when they turn on “roaming” (side note, only a very rare issue for usage in the US anymore, but non-zero). The primary account holder may get notifications on some things, but it depends on the carrier, the overage, the account. Which brings us to the Uh-Oh moment.
Then it gets BAD for the account/contract holder. Because only they are responsible for all the charges on the account. Your best friend forever finds their girlfriend is hurt in Ukraine, racks up $200 in international long distance, and then leaves a note as they fly out to help take care of them? That’s on you. The person who paid the most out of pocket (free phones are only free for certain values) and demanded to be an authorized user of the account? Well, they bought a brand new $1000 phone on an installment plan, and then ghosted the rest of you. Account holder is still stuck paying for that phone unless they report it as stolen to the cops, at which point you’re trying to recover from insurance (oh that’s another extra charge), or the other party, which can get rough.
So it works best with those you trust well, or if you’re willing to eat the additional costs. I don’t advise giving additional authorized person access freely either. But, on the flip side, it’s almost always a vastly better deal for multiple lines than a singleton.
Currently I have 8 voice lines on my account. Myself, my wife, my father, my step-mother, my mother and father-in law, best friend, and best friend’s mother. With my plan, discounts, and reduced use charges ($10 per line for low data usage) I pay around $150 per month for all 8. I added my friend and his mother because he was paying $60 per month on his own, and his mother was being all-but-robbed with an excessive plan for her needs at $90 per month. I don’t ask either of them for funds, and my friend is more than generous enough in his own way on other things that I am at least breaking even, trust me.
But would I do this with normal friends or just college roommates? No, I’d go for a prepaid option - because the reverse applies. You pay your account holder friend every month your full share. But Friend 2 and 3 don’t, the accountholder falls behind and defaults. Now you have no service, and your phone is locked.
Just to add one small thing to @ParallelLines’s excellent post:
With many carriers, you can also find a plan that just prohibits most overages. For example, it’s usually easy to prohibit calling any international numbers or international roaming, eliminating that major source of cost uncertainty. Data spending can likewise similarly be limited.
But yeah, still, if you’re the only payer to the cell phone company… don’t share your plan with anyone you don’t trust, unless you’re willing to outright pay their phone bill for them.
If you’ve survived this long without needing cell phones, well, no reason to start now, lol. They’re mostly an expensive, wasteful time sink anyway.
I’m on a group plan suggested by the friends who get billed for it. They bought my phone (their idea), I owe them a share of the bill. I’m not incurring extra charges; if I did, I expect they’d tell me and bill me for them. This works for us, because of who we are. It might not work for some other group of people.
I suggest only putting people on your group plan who you’re pretty sure you can work with – just like agreeing to share apartment rent with somebody, if you join up with somebody willing to screw you over or somebody who just has drastically different assumptions than you do, I’d expect there to be problems.
I shared various apartments and houses with various roommates and later a house with farm interns during the landline-only period. I very much do not miss the notebook in which we wrote down long distance calls and that had to be gone through each month in order to determine who owed what on the phone bill. Basically everything more than about ten miles away was a long distance charge. Even with the best of intentions there was very often at least one call that nobody had written down and nobody recognized (at least until we called the phone company to ask them who that number went to, and sometimes not then); and often there was more than one person who called the same number, so when somebody forgot to write one of those down we still didn’t know who had made it. One year there was a number that both I and a farm intern called and we both called that number both for personal reasons and for farm reasons.
And then there were always the calls left over after somebody moved out. Maybe they’d send the money, maybe they’d paid an estimated amount before they left, maybe neither of those things happened or the estimate was way off –
I was so happy when flat rate anywhere in the country came along!
Sorry for the gap – I lost track of this thread – but I do appreciate the very thoughtful and informative replies.
No, I’m not seriously looking at getting a cell phone at this time, though various companies, especially banks and credit card people, have been getting very insistent about my not supplying them with a cell phone ‘for my convenience.’ Actually, I rather like being not-quite-so immediately reachable all the time.
Also, there are a couple of subdivisions of my, well, call it ‘intermediate family’ that I absolutely do NOT want to be able to affect my finances at their will.
You know, Cousin George – the guy who will ‘discover’ that he has some extra hundreds of dollars in his checking account, so obviously it’s time to buy that latest gidget for his hobby or treat himself to a mini-vacation with the excess? Only to discover, to his amazement two weeks later that there’s an 'unexpected" mortgage or rent payment due, and it’s now a crisis, and surely you can help him out by covering his bill for X because he clearly HAS to to use his own money to pay for that more urgent thing Y while you can wait for him to pay him pay “real soon” which tends to mean never. Yeah, him.
We are willing to help various relatives sometimes, but we want to retain control of when or how much it comes to. Putting someone on your plan sounds more like giving them access to a credit card vs choosing to say yes or no on any given request. OTOH, if you have a group set up, wouldn’t refusing to let George into it be a really awkward conversation?
I think the middle ground here is just find a provider & group plan that will forbid (or at least heavily restrict) the kind of overages that group members can incur.
For the most part, that just means having an unlimited plan, disabling long-distance calls, roaming, and international usage. But talk to the plan provider for details.
It’s not like your group members can just charge random things to your account (well, maybe if they called a lot of 1-900s numbers, which can also usually be prohibited). For the most part they’ll be constrained within the plan’s calls/text/data limits, and any additional services or charges (like buying a new phone or subscribing to some streaming service) would have to go through an account manager first — that means you.
If your family members are deliberately trying to exploit you and make you pay for things you didn’t intend to… I think that’s a bigger problem than any cell phone plan. In that case I wouldn’t trust them with anything shared…
No, it doesn’t have to be. There’s no expectation that your entire network of extended relatives must share a group plan.
A perfectly reasonable explanation: “My SO and I finally got cell phones on the most basic plan we could find.” That’s it. No further explanation necessary.
If they probe and demand to know if you have a group plan they can join (who does that?!), just politely decline… “We love you, George, but we’re not very tech savvy and want to keep our phone plan as simple as possible, sorry! We’re not comfortable with all the ins and outs of the plan details and don’t want to make things more complicated.”
My relatives share 3-4 group plans among themselves (usually by family unit + close friends). Sure, we could all save maybe $5 each if we merged into one giant group plan with 15 people, but it’s just easier not to. Having a group plan doesn’t mean that everyone you know must be in it; it’s far simpler to manage a small one with only the people you’re closest to.
It’s your money and your plans; no need to be overly generous with either if it’s too complicated for you. Or just buy them a prepaid plan if you really want to be charitable.
Don’t most of them limit the number of people you can add? ‘Sorry, George, we were only allowed 4, and that’s the two of us plus X and Y, we’re full up now.’
I’m getting flashbacks of getting screwed over by housemates not paying me for their share of utilities.
When I shared a landline, any call over a certain amount, maybe $2, was claimed by whomever made it and the rest was just split evenly. I eventually got to know which numbers went with which roomies.
My sister and I have our cell phones on the same plan, because it’s cheaper than if we both had our own individual plans. Yes, our arrangement is pretty much what you said – the bill is in my sister’s name, so she pays the entire amount for our two “lines” every month, and I send her money every month to reimburse her for half the bill.
A MNVO is a cell phone company that doesn’t own and operate their own towers, but instead leases extra capacity from other providers and resells it under their own brand name and pricing and provides their own customer service.
Just remember that unless they can give you/the plan owner all of those privileges all the time, you may have to to turn on (& then off later) certain things that you have restricted. IOW, are you travelling? You need to call them up & enable roaming for a week & then call back after you get home & disable it again.
Yup! You & I get a plan together, I don’t pay you & I get free phone service. Winning!
Lol. Seriously though, is this really that big of a risk…?
Almost everyone I know who I’ve talked to about cell phones is on a group plan with their significant other or immediate & extended family. I mean, it’s not a huge sample size (not the most exciting topic of conversation), but that’s still like 10-12 groups I know of just anecdotally.
It’s not some sketchy secondhand resell marketplace of used phone plans… it’s just a handy consolidated billing option that makes it easier both for the carriers and the families or trusted friend groups who typically use it.
Yeah, if you share your plan with Grifty George or Sketchy Susan, they might flake on the bills… but otherwise, it’s typically a convenient and cheaper option for families and close-knit groups.
It only takes a minute to set up an automated bank transfer for your part of the plan, or a few seconds to send a Venmo request once a month.
Been a while since I last compared them.