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Sept. 29, 2022, 3:30 p.m. EDT

Is the iPhone 14 worth it? Apple CEO Tim Cook made one ‘brilliant move,’ but our verdict might surprise you.

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By Leslie Albrecht

<STRONG>Hello and welcome to Financial Face-off, a MarketWatch column where we help you weigh financial decisions. Our columnist will give her verdict. Tell us whether you think she’s right in the comments. And please share your suggestions for future Financial Face-off columns by emailing our columnist at lalbrecht@marketwatch.com. </STRONG>

The face-off 

Apple’s /zigman2/quotes/202934861/composite AAPL -1.38% latest iPhone is out. The iPhone 14 comes in four models: the basic iPhone 14, a “supersized” (Apple’s word) version called the iPhone 14 Plus, and the iPhone 14 Pro and the iPhone 14 Pro Max. The basic starts at $799, the Plus starts at $899, the Pro starts at $999 and the Pro Max starts at $1,099. 

All four models boast more advanced front and back cameras and safety features that can detect whether you’ve been in a car crash and help you call 911, even if you’re in an isolated area with limited cell service. The 6.7-inch iPhone 14 Plus has “the best battery life ever in an iPhone,” the company said.

All told, the iPhone 14 models “have incredible new features that will help our users in meaningful ways,” Apple chief executive Tim Cook said at Wednesday’s unveiling .

How meaningful those upgrades really are remains to be seen. But there’s no denying that the birth of the iPhone 15 years ago marked the beginning of a new, more intimate relationship between humans and their phones. Some might say that connection has morphed into codependency; people can’t seem to function without their smartphones.

Is now the time to take that relationship to the next level and get a new iPhone? 

Why it matters

“I think keeping the price at $799 was a brilliant move on Apple’s part,” said Charles Lindsey, an associate professor of marketing at the University at Buffalo School of Management. “By not raising the price, they will not only capture early sales from the Apple innovators/early adopters (who typically buy new versions as soon as possible) but they will also pull in/convert your more mainstream users (who are typically slower to upgrade).”

The iPhone 14 comes in “stunning” colors including deep purple and starlight. Those pretty hues contrast with some gloomy economic data in the U.S. : Record-high inflation has pushed Americans’ cost of living way up, home prices and rents have soared, and credit card debt has piled up as pandemic-related government relief has receded. The labor market remains extremely tight, but some companies have been laying off employees or freezing hiring.

All of that may make consumers skittish about shelling out close to $1,000 on a phone. Which may explain Apple’s decision to keep the base price of the iPhone 14 exactly the same as the starting price for the iPhone 13, unveiled in 2021.

The price isn’t the only thing that didn’t budge.

“The base iPhone 14 model is actually almost identical to the 13,” said Melanie Pinola, a senior writer and editor on the smartphone beat at Consumer Reports. 

Based on what Pinola saw at Wednesday’s unveiling, it appears that the iPhone 14 has the same display, processor, overall design and the same battery as the 13. “If you have a 13, I don’t know if I would switch to a 14 this year,” Pinola said. “There are small improvements with the 14, but I wouldn’t say I would rush out right now.”

The most notable change among the iPhone 14 models is the new larger version, the iPhone 14 Plus, with a 6.7-inch display, which is similar in size to the Samsung Galaxy S22, Pinola said. “This is the first time that Apple has ever made a large screen phone under $1,000, so it’s more accessible for people who want a larger phone,” Pinola told MarketWatch.

The verdict

Skip the iPhone 14, unless your existing phone is on life support. “If you’re not able to get security or software updates, it’s definitely time to get a new phone,” Pinola said.

My reasons

Tech companies have trained us to line up for new products on their schedule. But should Apple dictate when you spend money? Maybe that’s how it became one of the world’s most profitable companies . But blindly following Apple’s marching orders is not how you will become the most profitable version of yourself.

Is my verdict best for you?

On the other hand, the fact that Apple kept the starting price the same on the iPhone 14 could make an upgrade easier to swallow, said Philip Michaels, U.S. managing editor at the product review site Tom’s Guide.

“People who bought the iPhone 13 last year are probably still very happy with their phones and will have little reason to upgrade,” Michaels told MarketWatch. “And given Apple’s track record of lengthy software support — iOS 16 works fine on phones released five years ago — it’s easy to hold onto your current iPhone for a long time.”

“That said, if you’ve got an iPhone 11 or earlier, you will definitely notice an improvement in performance, even with the A15 Bionic chip on the iPhone 14 as opposed to the more advanced A16 Bionic powering the Pro models. Cameras figure to produce better results, too, though testing Apple’s new phones will confirm that. Because Apple held the pricing at iPhone 13 levels despite the rumors of price hikes, an upgrade is even easier to justify,” Michaels said.

Another possible incentive to upgrade: deals available through Apple can cut up to $800 off the price tag of the iPhone 14, and major mobile phone carriers including AT&T /zigman2/quotes/203165245/composite T +0.68% , T-Mobile /zigman2/quotes/204659678/composite TMUS -0.40% and Verizon /zigman2/quotes/204980236/composite VZ +0.76% , are offering discounts as well. 

If you’re trying to decide whether to upgrade, don’t forget about the value of your existing phone, said Josh Lowitz co-founder of Consumer Intelligence Research Partners, publisher of the upcoming CIRP-Apple report on Substack.

“Used iPhones have real value, as trade-ins or hand-me-downs to family or friends,” Lowitz said. “Our data shows that about half of new iPhone buyers trade-in or sell their old phone, and more than a third of those who monetize their old phone, report that it was worth more than $300.”

Retail promotions, including enhanced trade-in offers, can reduce the cost of ownership further, he noted. 

Another key point: mobile carriers are offering longer payment plans. In the past, phone purchases were generally broken up into 24 or even 18 or 20 payments. Now, 30 and 36 monthly payment plans are common, Lowitz said.

“That reduces the monthly outlay, though it postpones the relief of making that final payment, and the new phone buyer needs to be confident that their phone will serve them that long. Even with the strong residual value of an iPhone, a buyer with 36 payments may have negative equity in their phone into their third year of ownership,” Lowitz said.

Apple shares closed almost 1% up Wednesday after the iPhone 14 event, but they are down 12% year to date. The Dow Jones Industrial Average /zigman2/quotes/210598065/realtime DJIA +0.0047% and the S&P 500 /zigman2/quotes/210599714/realtime SPX -0.19% are down 13.5% and more than 16%, respectively, this year.

Don’t miss: Here are the iPhone 14 deals from AT&T, T-Mobile, and Verizon as preorders begin

See also: Think twice before you trade in your old smartphone or tablet — you could make more money ‘upcycling’ on resale sites

Tell us in the comments which option should win in this Financial Face-off. If you have ideas for future Financial Face-off columns, email our columnist at lalbrecht@marketwatch.com. 

Learn how to shake up your financial routine at the Best New Ideas in Money Festival on Sept. 21 and Sept. 22 in New York. Join Carrie Schwab, president of the Charles Schwab Foundation. 

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