We all remember the initial shock we got when we received our first cellphone bill after signing up for a two year contract with a specific service provider. It all sounded so nice, easy and cheap to choose a dandy, modern phone with all the various functions at a low monthly rate. What most people only realized later, was all the hidden costs and limitations involved in the contract that one is now legally bound to honor for the next two years. Buying mobile phones outright may save you a great deal of money and frustration, and give you a wider choice.

Mobile phones purchased on a contract basis may initially seem cheap because the full prize is subsidized by your monthly fees to the service provider over a two year period. In the long run, however, it can actually work out more expensive than buying an unlocked phone where there is no contract or hidden administration fees involved and more options available.

A once-off payment for an unlocked mobile phone of your choice may initially seem more expensive than with a 2-year contract. If you spread the amount over two years, it may actually be cheaper than your accumulated monthly payments - especially if you have a cheaper plan.

Investing in an unlocked mobile phone also spare you the time and frustration of dealing with billing or administrative errors that often occur with lengthy contracts. You are not restricted to the cellphones stocked by your carrier and thus have a wider selection. The only problem is that these cheaper phones only work on GSM cellular networks that use SIM cards. Since all mobile carriers do not operate on GSM networks, you must make sure to find the ones who are associated with unlocked mobile phones.

People are often disappointed when they cannot upgrade their cellphone contract to include a specific phone of their choice because it is not included in their service provider's package deals. Service providers can only allow a certain amount of manufacturers' products on their networks and thus one's choice is often limited. Without a binding contract, you can pick and choose any trendy unlocked cellphone of your choice from any manufacturer.

Apart from being cheaper and allowing greater flexibility and choice, mobile phones are also very handy and cost-effective for frequent travelers. Most countries sell local SIM cards for this purpose. When you have an unlocked mobile handset of your preference, you just need to buy a SIM card from a carrier or prepaid phone company to activate your services.

The cellphone industry is especially huge in poor countries where the infrastructure for telephone land lines are limited or absent. These SIM cards, containing all your personal information such as phone number, contacts and calling history, can be inserted into any unlocked cellphone. Depending on the length of stay, one can choose a contract that is monthly renewable, or longer contracts.

By buying a prepaid SIM card with a local number of the country in which you are staying, you can minimize your local calling costs. If you plan to travel to multiple countries during the same trip, it might be cheaper to buy a SIM card that offers international roaming services at the cheapest roaming rates. This will save you the trouble of buying a local SIM card in every country you visit.

If you only occasionally want to stay in touch with family and friends at home during your travels, you can use your compatible GSM unlocked cellphone with your home number. Naturally the cost for calls and texts will be more, but it will save you the hassle of giving new phone numbers from each country you visit to friends and family at home.

A mobile device with dual SIM cards is the best option for people who often have to travel internationally. These phones allow you to store your regular SIM card, as well as the one of your host country, in the same handset. This allows you to make and receive calls to and from your home on your regular number, while keeping the cost of local calls to a minimum.

With all the new advancements and technology in the cellphone industry, it is important to stay informed about all the latest trends and products. Outright mobile phones may just be a cheaper and better option for your specific needs!