# What is the difference between SIM-only and a phone contract?

> Quick answer · Last updated 4 July 2026

Canonical HTML: https://moneyguide.org.uk/answers/sim-only-vs-phone-contract-uk/
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## In short

SIM-only pays for airtime and data only — you use your own phone. Phone contracts spread handset cost over the contract term plus airtime — usually more expensive overall but spreads the device price.

Leaving a phone contract early often triggers handset balance plus exit fees.

Compare total cost over the full term including disclosed annual rises.

See compare mobile deals guide.

## Related

- [Compare mobile deals](https://moneyguide.org.uk/bills-utilities/compare-mobile-phone-deals-guide/)
- [What is a SIM-only deal?](https://moneyguide.org.uk/answers/what-is-a-sim-only-deal/)

## Primary source

ofcom.org.uk/phones-and-broadband

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Independent UK money guidance from [Money Guide](https://moneyguide.org.uk). Information only — not regulated financial advice.