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Apple iPhone Upgrade Program: Here's how it works with iPhone 12

Get a new iPhone every year.

62-iphone-12-2020
Patrick Holland/CNET

If you are ready to plunk down for an iPhone 12 but are already tracking rumors about the iPhone 13, then you might be a good candidate for Apple's iPhone Upgrade Program. With it, you can upgrade your current phone for the latest model every year.

It's basically the "iPhone as a service" plan: Instead of paying the full value up front or monthly payments to own a particular handset after two years, the iPhone Upgrade Program lets you trade in your current phone for a new model after making 12 monthly payments. Of course, for that privilege, you're paying a subscription fee for the foreseeable future. 

At this point in the year, it might make the most sense to make do with your current phone for a few more months and jump into the iPhone Upgrade Program in September when we expect to see the iPhone 13. That way, you'll be eligible to upgrade each year in September when Apple usually releases its latest iPhones.

How does the iPhone Upgrade Program work?

You buy an iPhone from Apple -- from an Apple Store in person, Apple's online store or the Apple Store app -- and agree to pay it off off over 24 months. But after making half of those payments, you're eligible for a free upgrade. After 12 months, you can trade in your current phone for a new model. The clock starts again on the 24 months of payments and eligibility to upgrade after making 12 of them. 

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Why buy from Apple instead of a carrier?

Apple sweetens the deal by including its AppleCare Plus coverage at a slight discount with the iPhone Upgrade Program. AppleCare Plus is the company's insurance and extended warranty program that would otherwise cost $7.99 a month for the iPhone 12 and 12 Mini or $9.99 a month for the iPhone 12 Pro or Pro Max. With the Apple Upgrade Program, you pay $6.21 a month for AppleCare Plus instead of $7.99 a month with the iPhone 12 or 12 Mini.

AppleCare Plus doubles the standard one-year warranty to two years, but that's less of a concern if you're planning on trading in your phone after the first year. The real value of AppleCare Plus is getting accidental-damage protection. You get two accident claims that'll replace your phone (each carries a $99 charge, but that's cheaper than buying a new phone). You'll also be able to replace a cracked screen or two for $29 per incident. Phone support is also extended to two years with AppleCare Plus, up from the standard 90 days.

How much does it cost?

Pricing ranges from $35.33 a month for the 64GB iPhone 12 to $66.58 a month for the 512GB iPhone 12 Pro Max. 

apple-upgrade-program-iphone-12
Screenshot by Matt Elliott/CNET

What about AppleCare Plus with Theft and Loss?

If you worry less about dropping or damaging your phone and more about losing it or it getting stolen, you can pay a bit extra per month to upgrade to AppleCare Plus with Theft and Loss coverage. It adds $4.16 to your monthly Upgrade Program bill and lets you pay a small deductible to replace a lost or stolen phone rather than the full cost of replacement.

How do I pay?

You'll need a credit card to sign up, at least in the US. In the US, Apple uses Citizens Bank for the installment loan, and it requires a valid, US-issued credit card to be eligible.

Is there an age limit?

Yes. Sorry, kids, you need to be 18 years old to apply. (And given the prices of the new Pro models, I hope you'll start being nicer to your parents.)

How do I trade in my current phone?

You can take it to an Apple Store and make the swap there, but you can also save the trip and buy from Apple's online store or the Apple Store app. When you order an iPhone online from Apple, it'll arrive with a trade-in kit so you can package up your suddenly outdated phone and ship it back to Apple. You need to get it back to Apple within 14 days.

Read more: The best ways to sell or trade in your old iPhone in 2021 

What if my current iPhone is banged up?

According to Apple, your current iPhone needs to be in "good physical and operational condition." That means it should:

  • Be able to power on and hold a charge
  • Have an intact and functioning display
  • Have no breaks or cracks

I haven't made 12 payments yet on my current phone -- can I still upgrade?

Yes, but it'll cost you. If you've made at least six monthly payments on your current phone, you can pay the difference between your current balance and the total for 12 payments to fast-forward the clock and get a new iPhone.

Do I need to upgrade?

No, not all at! You are not forced to upgrade. If you're happy with your current phone, you can keep using it and continuing to pay it off. After 24 months, you will have paid it off and can continue using it without the monthly payment, or you can turn around and sell it to help finance the cost of a new phone when you're ready.

Originally published three years ago. Updated with information about the latest iPhone models.