A WalletHub survey found that 34% plan to buy the new iPhone.
An extra $100 a month or even a grand on a credit card may not sound like the end of the world for but one of the core rules of personal finance is that racking up consumer debt on everyday items is rarely a good idea — you’ll want another iPhone soon enough while enough credit card debt can get you into a serious financial hole
But new tech toys can tempt even some of the most financially responsible. Unveiled last week by Apple (AAPL) – Get Apple Inc. Report, the latest generation of iPhone will not look significantly different from past generations.
But even so, features like a bigger screen, brighter camera sensor and, of course, certain previously-unavailable colors will come with a steeper price tag — the iPhone 14 will sell for $799 and the iPhone 14 Pro will go for $999.
Those who want the iPhone 14 Pro Max will need to shell out $1,099 while the iPhone 13 will be discounted to $699.
Debt? For An iPhone? Groundbreaking
According to the latest annual iPhone study by personal finance platform WalletHub, 36% of surveyed adults are planning to get the latest model shortly after it comes out. That number is 24% higher than last year.
Among those surveyed, 21% said a new iPhone is worth going into debt for.
In other findings, 31% of those surveyed said a new phone is a necessity.
Some 20% said that not having the latest model is a sign that someone is struggling financially. And 34% said their phone was their most valuable possession.
“More than a third of consumers think their phone is their most valuable possession. [It] is likely that few other devices can perform as many different functions while remaining easily portable,” WalletHub Analyst Jill Gonzalez wrote. “Cell phones are key for both their social use, like keeping people connected to their loved ones during the pandemic and times where travel is expensive, as well as for business use, especially as many people have switched to remote work.”
Financing And Deals Vs. Not Buying
Given the phone’s importance in one’s daily life, it is not surprising that many people are willing to shell out more for it — you’ll probably get more use out of it than a pair of shoes or another night out.
Inflation and rising iPhone prices also mean that those who might have been able to buy the phone outright a year ago are now struggling to finance it.
National credit card debt jumped from $841 billion in 2021 to $887 billion now, according to Lending Tree. Getting caught up in the flashiness of a new phone can be a problem. Thanks to increased debt, many Americans are finding themselves in a financial hole in which half their salary is going toward the credit card balance or even just interest payments. Many carriers now offer interest-free financing for new phones, but even those payments can also add to debt burdens.
“The differences in features between generations is relatively small now, compared to years ago where upgrades brought much more dramatic improvements,” Gonzalez said. “Getting a phone that’s a generation behind can be half the price and almost as good of a user experience. Consumers can also save money by buying used, good condition phones or looking for carrier discounts.”
