I've had both a contract and sim only. Currently have a contract and debating whether to go with Virgin's freestyle contract, meaning I can change my phone whenever and when my contract is up, my bill drops if I don't change my phone.
I tend to have, erm, issues with phones and they don't quite last the 2 years they should do. My current one is about 18 months old and will probably die on me soon.
If the contract works out cheaper, I'd go for that personally.