How to calculate the lifetime opportunity cost of buying iPhones vs Androids?

[HPstache]

I am so sick of friends taking jabs at me for always buying used Androids instead of new iPhones.  It's all in fun, but I'd love a good financial comeback.  Can someone help me calculate the lifetime opportunity cost for buying one vs the other?  Let's use the following assumptions:

1. 60 years of buying phones (age 18-78), let's just say starting "today"
2.  New phone every other year
3.  Cost to upgrade Android phone: $200, inflates by 3% every year
4.  Cost to upgrade iPhone: $500, inflates by 3% every year
5.  Invest difference in portfolio returning 7%
6.  I am making the assumption that the person is buying the "new" iPhone and that the Android person is buying a 1 year old used Galaxy.

If you have better assumptions feel free to use them.   My gut says this could be close to $100k... but I could be way off .

[HPstache]

Ok, I did performed a really simple attempt because it would be embarrassing if I didn't even try... I get $81,208?

Edit: I found a pretty major issue with my calculation, I was only applying a 3% inflation increase and a 7% investment increase to each excel cell, but since it's every other year, it should be more like 6% and 14% I guess?  That make things get whacky and more like $589,000 over a lifetime.  But upgrade cost gets blown out of control... maybe that should stay more consistent over the years?

So yeah, I need some help and more realistic numbers...

[six-car-habit]

Don't phrase it in terms of #'s of dollars.  I'll just substitiute for your $81,000 figure...

a) 3 newish Priuses and a fast home charger installation
b) 2 well kept low milage last gen rx7's plus an LS motor, a crate hemi, and a flat plane ford shelby motor + cost of parts needed to fabricate/enable the swaps
c) an indoor heated pool / sizable home addition /  nicer apartment for years
d) Trips to every continent in the world, bringing your whole family for an extended period in each
e) Season tickets to your friends favorite sports teams for many years
f) a new roof, deck, kitchen remodel, and full set of appliances

 I'd think one of these choices would appeal to your friends

[reeshau]

Or you could use the always-handy "you'll work one extra year for that."

[Linea_Norway]

My DH wants to replace his iPhone with a new one. But he is getting very annoyed by the high prices of the iPhone. So, despite of being an iPhone fan, he is now looking into Android phones. Maybe he will end up buying a Sony, a slightly newer model than what I have. He put up some price warning and my guess is that black Friday might be a good time for the price to drop steeply, like it did when I bought my phone last year.

[MasterStache]

I bought a brand new iPhone SE last year for about $60. I would never pay full price for a brand new iPhone that just hit the market. Yowzer!

[rantk81]

Hah.  It's not just cost.

I've had both. I prefer Android over iPhone, as I prefer most of the "products" within the Google ecosystem over the similar stuff in the Apple ecosystem.

For something like a technology item that can change drastically within a few years, I don't think you can project any useful findings out further in time than 5-10 years anyway.

[HPstache]

Don't phrase it in terms of #'s of dollars.  I'll just substitiute for your $81,000 figure...

a) 3 newish Priuses and a fast home charger installation
b) 2 well kept low milage last gen rx7's plus an LS motor, a crate hemi, and a flat plane ford shelby motor + cost of parts needed to fabricate/enable the swaps
c) an indoor heated pool / sizable home addition /  nicer apartment for years
d) Trips to every continent in the world, bringing your whole family for an extended period in each
e) Season tickets to your friends favorite sports teams for many years
f) a new roof, deck, kitchen remodel, and full set of appliances

 I'd think one of these choices would appeal to your friends

Good point on that

[ericrugiero]

Why are you comparing a USED android vs a NEW apple?  It seems like both are nice, both are expensive new, both are much cheaper used (or new a couple years after release). 

Wouldn't the cost to upgrade an iPhone be similar if you bought used or even new old stock?  A quick look at amazon shows "renewed" iPhone 7's for ~$200. 

 

[charis]

Why are you comparing a USED android vs a NEW apple?  It seems like both are nice, both are expensive new, both are much cheaper used (or new a couple years after release). 

Wouldn't the cost to upgrade an iPhone be similar if you bought used or even new old stock?  A quick look at amazon shows "renewed" iPhone 7's for ~$200.

Because many people cannot afford even a renewed phone out of pocket and/or "locked" into a phone plan/upgrade program that involves upgrading to a new phone every 1-2 years.  Also, if the price seems low - sometimes the buyer is required to enter into a contract with the phone company selling it, even on Amazon.

I would also consider the cost of paying for new phones on an installment basis and the cost of insurance (also common).

[mschaus]

Yeah I'm not sure why the iPhones are listed as being more expensive. I buy a used iphone once every ~3yrs for $250, then sell the old one for $100. Darn cheap, and I always have a modern phone.

[afox]

One dirty big secret about android is that the phones dont always get updates and very rarely does a phone get updates as long as iphones do, so you can easily end up with a 2-3 year old phone that cant get the latest android updates, some are security updates. Its sort of premature planned obsolescence. I even had one top of the line when it came out android phone that stopped getting updates around 18 months after it was released when motorola was bought by google. So, the lifecycle of the phones may shorter for android. And I am still an android user despite this since phones are cheaper, i can still replace my battery, apps have more selection and are cheaper, etc...its just something to be aware of.

It is interesting how we've gone from one landline for a family when I was growing up to one smartphone per person over the age of 10 now. Total cost per family/person is much higher now than it was in the past...

[Linea_Norway]

One dirty big secret about android is that the phones dont always get updates and very rarely does a phone get updates as long as iphones do, so you can easily end up with a 2-3 year old phone that cant get the latest android updates, some are security updates. Its sort of premature planned obsolescence. I even had one top of the line when it came out android phone that stopped getting updates around 18 months after it was released when motorola was bought by google. So, the lifecycle of the phones may shorter for android. And I am still an android user despite this since phones are cheaper, i can still replace my battery, apps have more selection and are cheaper, etc...its just something to be aware of.

It is interesting how we've gone from one landline for a family when I was growing up to one smartphone per person over the age of 10 now. Total cost per family/person is much higher now than it was in the past...

When I bought my newer Android, having one with a newer operative system and support two versions ahead was important. Most of the Samsungs that I could afford had updated OS. Amd the Sony was current.

[afox]

When I bought my newer Android, having one with a newer operative system and support two versions ahead was important. Most of the Samsungs that I could afford had updated OS. Amd the Sony was current.

what do you mean " support two versions ahead"?  You found a phone with a guarantee to be updated with the next two versions of android? Ive never heard of such a guarantee for an android phone.

[BDWW]

I tend to use phone cost per year as my metric, since the plan wouldn't change.

I've been spending ~$100 per year on my phone. My current phone cost $240 (Moto G5 Plus) new in April 2017. It's starting to randomly reboot  and have other weird issues so I might replace it in the near future.

Currently: 884 days old /365.25 -> $240 / 2.42 = $99.16 per phone year.

I haven't ever used iphones, so a per year cost is up to someone more familiar.

[BDWW]

When I bought my newer Android, having one with a newer operative system and support two versions ahead was important. Most of the Samsungs that I could afford had updated OS. Amd the Sony was current.

what do you mean " support two versions ahead"?  You found a phone with a guarantee to be updated with the next two versions of android? Ive never heard of such a guarantee for an android phone.

Maybe he meant years rather than versions. The Android One phones get software updates for 2 years and security updates for 3 if IIRC.

[Adge]

I tend to use phone cost per year as my metric, since the plan wouldn't change.

I've been spending ~$100 per year on my phone. My current phone cost $240 (Moto G5 Plus) new in April 2017. It's starting to randomly reboot  and have other weird issues so I might replace it in the near future.

Currently: 884 days old /365.25 -> $240 / 2.42 = $99.16 per phone year.

I haven't ever used iphones, so a per year cost is up to someone more familiar.

I bought my iPhone 5S that same month for $150 on sale and have had absolutely no problems with it so far (knock on wood). The battery drains faster than it used to, but not so fast that it’s a problem.

[ericrugiero]

Why are you comparing a USED android vs a NEW apple?  It seems like both are nice, both are expensive new, both are much cheaper used (or new a couple years after release). 

Wouldn't the cost to upgrade an iPhone be similar if you bought used or even new old stock?  A quick look at amazon shows "renewed" iPhone 7's for ~$200.

Because many people cannot afford even a renewed phone out of pocket and/or "locked" into a phone plan/upgrade program that involves upgrading to a new phone every 1-2 years.  Also, if the price seems low - sometimes the buyer is required to enter into a contract with the phone company selling it, even on Amazon.

I would also consider the cost of paying for new phones on an installment basis and the cost of insurance (also common).

We have done this for my wife's last two iphones with no issues and no contract required.  I agree that some people don't have the $200 cash on hand but that's the same issue for iPhone and android. 

I'm just saying the difference is buying the latest and greatest vs used or at least slightly older not iPhone vs android. 

[wageslave23]

Why are you comparing a USED android vs a NEW apple?  It seems like both are nice, both are expensive new, both are much cheaper used (or new a couple years after release). 

Wouldn't the cost to upgrade an iPhone be similar if you bought used or even new old stock?  A quick look at amazon shows "renewed" iPhone 7's for ~$200.

Because many people cannot afford even a renewed phone out of pocket and/or "locked" into a phone plan/upgrade program that involves upgrading to a new phone every 1-2 years.  Also, if the price seems low - sometimes the buyer is required to enter into a contract with the phone company selling it, even on Amazon.

I would also consider the cost of paying for new phones on an installment basis and the cost of insurance (also common).

We have done this for my wife's last two iphones with no issues and no contract required.  I agree that some people don't have the $200 cash on hand but that's the same issue for iPhone and android. 

I'm just saying the difference is buying the latest and greatest vs used or at least slightly older not iPhone vs android.

I think an iPhone is what most people think of when they think of "latest and greatest", but you are right its not iphone vs android.  Its brand new, top of the line vs used and cost efficient.

[HPstache]

Why are you comparing a USED android vs a NEW apple?  It seems like both are nice, both are expensive new, both are much cheaper used (or new a couple years after release). 

Wouldn't the cost to upgrade an iPhone be similar if you bought used or even new old stock?  A quick look at amazon shows "renewed" iPhone 7's for ~$200.

Because many people cannot afford even a renewed phone out of pocket and/or "locked" into a phone plan/upgrade program that involves upgrading to a new phone every 1-2 years.  Also, if the price seems low - sometimes the buyer is required to enter into a contract with the phone company selling it, even on Amazon.

I would also consider the cost of paying for new phones on an installment basis and the cost of insurance (also common).

We have done this for my wife's last two iphones with no issues and no contract required.  I agree that some people don't have the $200 cash on hand but that's the same issue for iPhone and android. 

I'm just saying the difference is buying the latest and greatest vs used or at least slightly older not iPhone vs android.

I think an iPhone is what most people think of when they think of "latest and greatest", but you are right its not iphone vs android.  Its brand new, top of the line vs used and cost efficient.

That's what I'm trying to get at... but I agree it's not really fair to compare the two for Mustachians.  It is fair to compare the two within my group of friends, however...

[ketchup]

When I bought my newer Android, having one with a newer operative system and support two versions ahead was important. Most of the Samsungs that I could afford had updated OS. Amd the Sony was current.

what do you mean " support two versions ahead"?  You found a phone with a guarantee to be updated with the next two versions of android? Ive never heard of such a guarantee for an android phone.

Maybe he meant years rather than versions. The Android One phones get software updates for 2 years and security updates for 3 if IIRC.

For iPhones it's more like 4-5 years.  An iPhone 5S from 2013 is just now about to stop receiving software updates (when iOS 13 ships).  Oddly OS obsolescence is a category Apple is the least bad in.

[afox]

When I bought my newer Android, having one with a newer operative system and support two versions ahead was important. Most of the Samsungs that I could afford had updated OS. Amd the Sony was current.

what do you mean " support two versions ahead"?  You found a phone with a guarantee to be updated with the next two versions of android? Ive never heard of such a guarantee for an android phone.

Maybe he meant years rather than versions. The Android One phones get software updates for 2 years and security updates for 3 if IIRC.

For iPhones it's more like 4-5 years.  An iPhone 5S from 2013 is just now about to stop receiving software updates (when iOS 13 ships).  Oddly OS obsolescence is a category Apple is the least bad in.

i didnt know about android one phones till now but the short list of phones seems like they are expensive and obscure brands:
https://www.androidauthority.com/android-one-phones-845455/

To me the lack of android updates is the biggest drawback of android and it certainly has an affect on the per year price of a phone. Even 2 years is not good as the hardware can last much longer than that, im getting 3-4 years out of my hardware. Also, I assume that is not 2 years from the date you buy the phone but when it is released.

[MMMaybe]

I have had a One Plus 3T since 2017 and its still going strong. I also have an iPhone X for work. I much prefer my Android phone. I actually find the iPhone not innovative. It doesn't have dual Sim and buying apps is a hassle compared to the Google Play store. Why would I pay 3 x the cost?!!

[Car Jack]

I'm sure there are others like me.  My previous job gave me a new iPhone 4s to use for work.  4 years later, I asked the IT department if I could buy it as I was familiar with it and refused all ios updates, so I did not have the battery throttling problems.  They couldn't understand why anyone would want that ancient thing and gave it to me for free.  Last year (2.5 years into my new job), my company changed email systems and the 4s could not support it.  I needed something at least ios 12, so bought a used 5s, a case and new sim card.  Under $200.  My work gives me up to $200 for a phone every 2 years, so free.  It's taxable and last year, my effective rate of fed and state was about 20%, so I guess this cost me $40.  So at this point, $40/7 years...

I will say that one added bonus of this "new" phone is that google maps is available.  There really is nothing on newer phones that I have any interest in.

[WhiteTrashCash]

I'm using an Android phone but it was a gift to me five years ago. It's still fine, so I keep using it. That's probably really good savings.

[ericrugiero]

We have effectively side tracked the OP's original question which was the opportunity cost of upgrading to the latest and greatest phone.  Since I actively participated in sidetracking, I figured I should run some numbers. 

Saving $150/year on upgrading a phone and investing that money yields some big numbers if you leave the money alone long enough.   

At 7% 
10 years=$2,072    25 years= $9,487     50 years = $60,979    60 years=$122,028

At 10%
10 years=$2,390    25 years= $14,752     50 years = $174,586    60 years=$455,222

[Slow2FIRE]

I am so sick of friends taking jabs at me for always buying used Androids instead of new iPhones.  It's all in fun, but I'd love a good financial comeback.  Can someone help me calculate the lifetime opportunity cost for buying one vs the other?  Let's use the following assumptions:

1. 60 years of buying phones (age 18-78), let's just say starting "today"
2.  New phone every other year
3.  Cost to upgrade Android phone: $200, inflates by 3% every year
4.  Cost to upgrade iPhone: $500, inflates by 3% every year
5.  Invest difference in portfolio returning 7%
6.  I am making the assumption that the person is buying the "new" iPhone and that the Android person is buying a 1 year old used Galaxy.

If you have better assumptions feel free to use them.   My gut says this could be close to $100k... but I could be way off .

Your price for a used phone is about on par for a "premium" phone.

Your price for a new "premium" phone is too low.  $650 (or maybe $700) is the current minimum price for the cheapest "premium" phone.  Some of the top of the line phones are around $1000.

[undercover]

A new iPhone kept for 5-6 years is actually not a bad deal at all considering Apple keeps upping the number of years they support their old devices with updates. I think the 6 which is five years old just recently received "end of life" status. I don't know of any Androids that receive updates five years later. I know Android is generally worse for people that hang on to phones but I admittedly don't know how much worse. Point is that it's not really an OS debate as much as it is a "value" debate.

It's probably much more meaningful to calculate the opportunity cost over a more reasonable period like ten years though and ask yourself if you'd rather continue spending that way or if there's something else you value more.

[fuzzy math]

A lifetime of iPhones is calculated as a life well lived.

I tried to do Android, I even justified how much cheaper it was as my only reason for the switch (knowing I would have to deal with the hassle of a different OS). Had a ton of issues - no notifications, apps wouldn't install and stay installed, messaging issues, calendar issues. Every time I tried to download an app to fix the gaps in what I needed, I couldn't find a product that would suit my needs. Googling was worthless since there were 67,435 different android OS versions my specific problem was never solvable. I got a second Android phone and found new and different issues, still wildly unexplainable. I could never figure out whether it was republic wireless or the phones or what. It was interfering with my job and therefore I went back to Apple.

[Linea_Norway]

When I bought my newer Android, having one with a newer operative system and support two versions ahead was important. Most of the Samsungs that I could afford had updated OS. Amd the Sony was current.

what do you mean " support two versions ahead"?  You found a phone with a guarantee to be updated with the next two versions of android? Ive never heard of such a guarantee for an android phone.

Maybe it was described in an independend test as "it can be expected to support 2 future Android versions". And I interpreted it as some sort of given fact.

[Metalcat]

That's what I'm trying to get at... but I agree it's not really fair to compare the two for Mustachians.  It is fair to compare the two within my group of friends, however...

Maybe get better friends?

What kind of friends mock someone for their phone choices or for saving money? How asinine.

I would recommend learning how to train your friends to respect your financial choices instead of trying to educate them about phone costs. They obviously put a lot of value on having new iPhones, I doubt they will be moved by your numbers.

[felixbf]

A lifetime of iPhones is calculated as a life well lived.

I tried to do Android, I even justified how much cheaper it was as my only reason for the switch (knowing I would have to deal with the hassle of a different OS). Had a ton of issues - no notifications, apps wouldn't install and stay installed, messaging issues, calendar issues. Every time I tried to download an app to fix the gaps in what I needed, I couldn't find a product that would suit my needs. Googling was worthless since there were 67,435 different android OS versions my specific problem was never solvable. I got a second Android phone and found new and different issues, still wildly unexplainable. I could never figure out whether it was republic wireless or the phones or what. It was interfering with my job and therefore I went back to Apple.

If buying a cheap Android device then that is to be expected. If you bought a top tier Android none of those issue's would be a problem.
The trick is to research cheap Android device of choice, if it can be rooted and flashed with a custom OS then none of those issue's would become a problem.
Currently rocking a Vivo Nex 1 device. Has top tier (the same as the Samsung s9) specs for half the price of the Samsung Note 9 and Apple X device of 2018.
Only deference the Vivo nex was the first device with a in screen finger print and no front facing camera(has a popup camera).
Seeing I do not take selfies, I have probably used it 5 times since 2018. Phones also takes under an hours to fully charge with a 25watt dual engine charger.

The device actually destroy's the Note 9 and Apple device with spec's and first NEW type tech. No notch, no tear drop camera crap.

[PDXTabs]

3.  Cost to upgrade Android phone: $200, inflates by 3% every year
4.  Cost to upgrade iPhone: $500, inflates by 3% every year

I've never been happy with a $200 Android phone. I always get the mid line Google phones like the Nexus 4/5, Pixel 3a, etc. They're ~$400.

Also, for all my Apple hating my iPhone SE lasted longer than any of my Android phones. I think it is fair to say that an iPhone will last four years. My Android hardware always dies before that.

Comparing to mid range Android phones I'm not sure that Apple is more expensive at all assuming that you never break or lose your phone, and I own an Android phone.

[OtherJen]

3.  Cost to upgrade Android phone: $200, inflates by 3% every year
4.  Cost to upgrade iPhone: $500, inflates by 3% every year

I've never been happy with a $200 Android phone. I always get the mid line Google phones like the Nexus 4/5, Pixel 3a, etc. They're ~$400.

Also, for all my Apple hating my iPhone SE lasted longer than any of my Android phones. I think it is fair to say that an iPhone will last four years. My Android hardware always dies before that.

Comparing to mid range Android phones I'm not sure that Apple is more expensive at all assuming that you never break or lose your phone, and I own an Android phone.

I really like the Pixel 3a, which I purchased brand new shortly after release to replace a 3-year-old Nexus 5x that hadn’t received software/security updates for months and tended to bog down and crash. My husband likes his Moto G7 (purchased after his 3-year-old Nexus 5x bricked itself randomly). But I don’t expect either phone to get security updates for more than 3 years, after which we’d want to replace them with newly released phones to maximize the security update period. The cost difference is probably a wash for us.

[FLAFI]

The Pixel 3, or the budget friendly, Pixel 3a are the best Android phones for updates. Google guarantees updates for 3 years. Pixels are also the first to receive updates. We're currently on Android 10. Google frequently runs promotions for purchase. We purchased two Pixel 3s for the price of one ($399.50 each). $399.50 is a bit steep, but we received flagship specs with three years guaranteed updates. After purchasing refurbished iPhones for years, it was a nice upgrade. After nearly a year of use, I prefer the clean Google version of Android found on the Pixel over IOS.         

[2sk22]

The Pixel 3, or the budget friendly, Pixel 3a are the best Android phones for updates. Google guarantees updates for 3 years. Pixels are also the first to receive updates. We're currently on Android 10. Google frequently runs promotions for purchase. We purchased two Pixel 3s for the price of one ($399.50 each). $399.50 is a bit steep, but we received flagship specs with three years guaranteed updates. After purchasing refurbished iPhones for years, it was a nice upgrade. After nearly a year of use, I prefer the clean Google version of Android found on the Pixel over IOS.         

Each to their own - I find a lot of value in using the Apple constellation of products. I really like using Apple Pay in my Apple Watch (now accepted in all the stores I shop as well as the Subway in NY City where I work). Using my Apple Watch to unlock my Macs when I log in, being able to use handoff to do copy/paste between devices.

I absolutely detest Google's approach to being as invasive as possible and I have switched to using Duck Duck go for all of my search needs. I am however sadly stuck on Gmail until I can move all my personal mail to Fastmail (work in progress)

[afox]

The Pixel 3, or the budget friendly, Pixel 3a are the best Android phones for updates. Google guarantees updates for 3 years. Pixels are also the first to receive updates. We're currently on Android 10. Google frequently runs promotions for purchase. We purchased two Pixel 3s for the price of one ($399.50 each). $399.50 is a bit steep, but we received flagship specs with three years guaranteed updates. After purchasing refurbished iPhones for years, it was a nice upgrade. After nearly a year of use, I prefer the clean Google version of Android found on the Pixel over IOS.         

Its 3 years from the date the phone was released not when you bought it, if you are a cheapskate and wait for it to go on sale or wait till you can buy a refurbished model you're not getting 3 years.

https://support.google.com/pixelphone/answer/4457705?p=pixel_android_updates&visit_id=637043314409965471-3712014822&rd=1

[ysette9]

I love a lot of what Google has to offer but my husband switched from iPhone to Pixel recently and just does not like it as much. If the Apple ecosystem works better for you for whatever reason I see no issue with that.

[dang1]

I am so sick of friends taking jabs at me for always buying used Androids instead of new iPhones..

those are not friends, those are assholes

[HPstache]

I am so sick of friends taking jabs at me for always buying used Androids instead of new iPhones..

those are not friends, those are assholes

You may have missed the part where I said, "it's all in fun"

[dang1]

I am so sick of friends taking jabs at me for always buying used Androids instead of new iPhones..

those are not friends, those are assholes

You may have missed the part where I said, "it's all in fun"

i felt it, i really did - the Force is strong with you! lol.

actually my last new phone was a galaxy nexus, that was a galaxy away many moons ago.

since then, I'm very happy with one generation back flagship, currently an S9+ still plenty capable bought used pristine off ebay for $300+. no problem consuming 70 gb of vzw data last cycle (grandfathered vzw unthrottled unltd). and that was low

Every time I look for a replacement phone, I keep an open mind and compare Androids and iPhones. I really try to like iPhones but damn no. iphone 8+ were generally around $200 more than S9+, and that's just the start. For me, Androids are just a better value, lots of models to choose from, I can modify an Android to my own liking alot more than an iPhone- and that's not even rooting it.