Is Virgin Mobile's "Pay as You Go" a Good Deal?

Virgin Mobile's "Pay as You Go" Cell Phone Program seems like a great deal: rather than paying a flat monthly fee, you only pay for the time you use. Backed by slick advertising and a brand name popular with kids, Virgin Mobile has captured a nice share of the cell phone market. "Pay as you go" can be a great option for those who use it wisely, but if you aren't careful, you will end up paying much more than you ever planned to.

Of course, you must choose a cell phone before you pick a service plan. Phones range from $19.99 for a basic Kyocera cell phone to $150 for a "Switchback" model with keyboard for text messages. Virgin phones (with instructions on how to activate) can be found anywhere, from 7-11 to Radio Shack and most major retailers. If you do little to no texting and do not need the latest ringtones, the inexpensive cell phones will work just fine, and are of very good quality. Coverage is fairly good, and unlike some providers, Virgin does not drop calls very often in urban areas.

In order to decide which plan is the best, you must first get a realistic estimate of your minute usage. If you already use a cell phone, this should be fairly easy to do. Just be sure not to count holidays or anytime in which you unusually spent too many minutes. This can skew your average, and going over every once in a while isn't too brutal.

If you've never used a cell phone, or buying one for your child as their first, estimating your usage could be harder. Will the cell phone be used every day, for a parent and child to check in on each other? Will it be used for business, as a way to catch calls while you are on the road? Is it only for emergency use? If it is to be used by a teen to keep in touch with friends, your best bet is not to use Virgin at all. Since most minutes used by teens are after school, other larger carriers offer better deals on primetime and anytime minutes. On the other hand, "pay as you go" is a great way to teach a kid responsible phone use if he/she is having to pay for their own minutes. Adding more money to your account, called a "Top-Up," can be painful for any teen on a budget, even at the minimum $10 level.

Virgin's plans are pretty simple: by the month or by the minute. As of summer 2006, Virgin Mobile rates were as follows. The "By The Minute" plan changes a flat 18 cents per minute, no other fees apply.

The "By The Month" plans break down as follows:
For $6.99 a month, all minutes that month are 10 cents each.
For each of the following plans, additional minutes over the stated amount are 18 cents each:
For $14.99 a month, you get 100 anytime minutes.
For $24.99 a month, you get 200 anytime minutes.
For $34.99 a month, you get 300 anytime minutes and 1000 primetime minutes.
For $44.99 a month, you get 400 anytime minutes, with unlimited primetime minutes (7 p.m. - 7 a.m.).
For $59.99 a month, you get 600 anytime minutes, with unlimited primetime minutes.

If you choose to send or receive text messages, rates are five cents each, 50 for $1.99, or 1000 for $9.99.

Once you have your average monthly minutes estimate, deciding on a plan should be easy. When it comes to Virgin rates, your first "magic minute number" is 75. If you use 75 or fewer minutes per month, it is best to use the "minute to minute" program at 18 cents a minutes with no additional charges. At that level, the most you will pay in a month is $13.50, less than any of the other programs.

Your next "magic minute number" is 100. Once you hit that level of usage, your best buy is the $14.99 base charge plan, with 100 free minutes. At this rate, you pay far less per minute (14.9 cents) than the per minute (18 cents) or 10 cent (actually 16.9 cents) plan.

Of course, if use more than 100 minutes, the monthly plans are the best buy for the minutes involved. However, Virgin may not be your best buy for monthly plans. There are a number of wireless service providers that offer great rates, and can often beat Virgin's rates, especially "family" plans that offer several phones with a large amount of minutes.

Virgin often offers special promotions that can earn you free minutes or discounts on minutes, like their "Sugar Mama" program. When you enroll in the "Sugar Mama" program, you can earn a free minute for every online ad you watch, survey you take, and every two ads by text message you respond to. If you don't use many minutes, it can be a nice bonus that saves money.

It may be a good idea to monitor your teens usage, if it is their first cell phone. You can track call usage at Virgin's website. One cell phone store employee reported that he has some young teens on Virgin Mobile coming in to buy "Top Up" cards (which can provide more time) at rates totaling over $100 a month, far more than they would pay with just about any other cell service provider. Customers can also register any credit card or debit card on Virgin's website to automatically charge more minutes to it when needed. This could lead to the ever-popular "statement shock" when the parent gets the bill the next month.

If you use a cell phone sparingly, Virgin's "minute to minute" plan is a great buy. Virgin only requires that you add money to your account every 90 days. For large volume minute use, you can probably get a better deal with another provider. Once you know what you need in minutes, simple math can point you to the best deal.