Method. Deal A total = upfront + Σ(monthly × annual-rise factor), one rise applied at each 12-month point, which is how UK contracts with CPI/RPI-plus clauses lift the price each April. Deal B total = handset + Σ(SIM monthly with the same rise model) − resale value. The resale assumption matters: flagships typically retain a meaningful slice of their price at two years, so set it to 0% for the pessimistic view.

Worked example. £42 × 24 months with a 7.9% rise each April costs 12 × £42  plus  12 × £45.32 ≈ £1,047.84, plus £79 upfront: £1,126.84. The same phone at £899 with a £10 SIM (same rise) costs about £1,148 before resale — almost level. Lower the SIM to £8 and SIM-only clearly wins; find the phone refurbished at £650 and it is not close.

When the contract still wins. Some networks discount bundled airtime below the handset’s cash price on launch promotions, and a £0-upfront deal can be the only spreadable option if £899 is not sitting in the bank. Run your actual quotes, not the defaults.

Method: total-cost arithmetic only; no coverage, insurance or credit implications priced in. Not financial advice. Last reviewed 2026-09-21.