An unlocked phone is not tied to any specific carrier meaning you can move to another provider at anytime by simply swapping the SIM card. The SIM card is tied to a carrier, when you change carriers, they will provide you with a new SIM card.
Rates and mobile providers are constantly changing, and you want to be free to shop around and switch carriers at any time.
When you buy your phone through a carrier it is locked to that carrier indefinitely, although you can request the lock is removed after your contract is up and the phone is paid for. Each carrier has its own rules when it comes to removing the lock, they must provide you with a specific code to unlock the phone before you can use it on another network.
You can avoid the hassle by buying an unlocked phone, you can do this directly through a manufacturer like Apple or Samsung or purchase it from a third party like Amazon or Best Buy.
Most new phones will work on all the major networks, but you do want to check before you purchase the phone to make sure it is compatible with the carrier you are using and also the other major carriers if you decide to switch. You can find this information by reading the spec details.
Often when you buy a phone through a carrier, they offer special pricing and financing options but manufactures like Samsung and Apple also have financing options so shop around.
When you purchase an unlocked phone, it will not come with the SIM card installed like it would if you purchased it through a carrier so you will need to contact your mobile provider who will send you a SIM card, with instructions on how to activate your phone, it is typically a very simple, quick process.
If you want to have the freedom of shopping around for a lower priced carrier an unlocked phone is a wise choice.
The Tech Minimalist 