answer:It would help to build your credit by entering into the contract as long as you pay your bill on time. The big drawbacks; you are locked into a contract and if you do not pay you bill on time, you will ruin your credit instead of build it. If you decide to do a contract, make sure you know all the costs involved. There are taxes (federal and state) and fees (like 911 availability) on top of the contract price that you have to pay. Also, depending upon the phone, you have to pay for other services. An example, I got my husband a Droid and we have to pay extra money a month for the web availability whether he uses it or not. (He does as his commute is 3 hours a day.)