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If you're interested in upgrading to a new iPhone, you're in luck on two fronts. First, even if you're still within your two-year contract with a major wireless provider, most carriers now make it easy to upgrade your phone for a small fee, or even for free. Being locked into a contract is no longer a barrier to getting a new iPhone.
Second, despite what you might think, many old iPhones retain a significant resale value, and you can trade yours in with little effort. In fact, given the popularity of the iPhone upgrade cycle, there are a lot of venues available to resell or trade-in your used phone.
Amazon is a popular clearinghouse for used hardware, but you don't get actual cash. Instead, you get Amazon credit, which just as good as cash for many people, since Amazon is a general purpose online department store.
If you're more interested in getting actual cash, you've got your pick of sites that take trade-ins online. Sites like Next Worth, Glyde, and Gazelle all work more or less the same way, offering you a competitive price based on the phone model, as well as its condition.
There's also the trade-in route, in which you literally exchange your used phone for a discount on your next handset. A slew of retailers offer this convenience, including Apple, Best Buy and Target.
How much money you can get for your existing handset varies by handset and the trade-in service you use; another factor is the carrier the phone is designed to work with. Sprint phones, for example, have a relatively lower trade-in value than those from the other carriers. The Wall Street Journal compiled an informative chart that plots the expected trade-in of various iPhone models against all four carriers -- be sure to check it out to see exactly what you can recover from your old iPhone.
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Good information.