If you are like me, you spend a ridiculous amount of money on your phone. Until recently, my wife and I shared a family plan with two iPhones on AT&T.

Yikes, $4100 over the life of a 2 year contract.

As I looked into options for getting an unlocked iPhone to use on a cheaper carrier, I learned two important things. Verizon iPhone 5 and 5s come unlocked from the factory. Also, Verizon doesn’t restrict moving the sim card between devices. Could this mean that one could activate a data-only plan on an iPad and move the sim into an iPhone? It turns out the answer is yes.

How to Activate the Plan

What you need: iPhone 5 or 5s, nano sim, iPad Mini or iPad Air

Buy or borrow (you won’t need the device once your plan is set up) a Verizon iPad Mini or iPad Air. Put the nano sim in the iPad and sign up for a data plan. Current choices are 1GB for $20, 2GB for $30 or 5GB for $50. Remove the sim from the iPad and put it in your iPhone.

Porting Your Number to Google Voice

Once your phone is activated, port your number into Google Voice. Do not cancel your existing service as that will happen automatically once the port is complete. Google charges $20 for the port.

Voice Calls

After receiving notification that your port completed, you are ready to start making calls. You’ll need to use an app that integrates with Google Voice for calls. The current choices are Talkatone, Google Hangouts and Mo+ Phone.

Talkatone

This is the app I have settled on using. The good: very stable, solid audio quality and it integrates well with your contacts. The bad: it has ads unless you pay $1/mo and SMS notifications are slow (see below for more on this). The ugly: this app. It gets the job done, but compared to the built-in Phone app it isn’t much to look at.

Google Hangouts

Hangouts has a slick UI and would be the obvious winner except for a fatal flaw — incoming calls only show a phone number instead of a name from your contact list. If Google fixes this and adds SMS support this would be the killer app.

Mo+ Phone

Looks better than Talkatone, but suffers from occasional audio issues. SMS notifications are delayed. Ad supported.

SMS and iMessage

For contacts that are on an iPhone, you can continue to use the Messages app. Although when an iPhone user sends a message to your phone number, it will be sent through Google Voice since that number is no longer associated with your phone. If you respond via iMessage, from then on messages will go through the Messages app.

For contacts that are not on an iPhone, I recommend using the official Google Voice app. Talkatone will receive SMS, but there can be a significant delay before a notification appears. With the Google Voice app, the notification will pop up immediately.

Two things that Google Voice cannot do: picture/video messages and group texts. If someone tries to send this type of message it will not go through and neither person will know.

Does this Really Work?

I’ve been using this plan for a month and it has worked great. For me, the couple of sacrifices are not significant and more than offset by the huge cost savings.

How does saving $1200/yr sound?

Pros

Since calls go over data, voice calls are very high quality when on wifi. Coverage was spotty in parts of my house, so this is a big improvement for me. Overages are not possible. If you hit your data limit, you either need to buy more data or wait until the month cycles. No contract and no activation fees.

Cons

VoIP Calls require a better signal than cellular voice calls. In places where the signal is very weak, you might not be able to get through with voice. No group or picture messages with people that don’t have an iPhone.

TL;DR