You need a phone, but you do not need a phone costing $500 and up. I have a $30 POS ZTE branded phone that does 90% of what those $500 to $1000 phones do.
Did you get the $30 phone in combination with your phone contract?
If yes, how much does that cost per month and how many months are you bound to that contract? I'm pretty sure, a lot of the hardware costs are hidden in the monthly payments.