Now, before you get started, you will need to know that there are a few downsides to enabling your iPhone to tether your existing 3G service. First, you will need to be sure that your existing 3G plan has unlimited data included in your monthly bill. Heavy iPad usage will likely result in large amounts of online data being used, especially if you are streaming video, so check your service contract to ensure you won't go over any data limits you may have.
iPhone plans do have unlimited data, but AT&T reserves the right to stop service if they feel too much data is being used. Of course, you will also need to have your phone available any time you need 3G service on your iPad, so take that in to account when deciding whether or not to do this. You will also have to jailbreak your iPhone and the overall speed of 3G service may be diminished.
This hint comes courtesy of Nicholas over at brighthub.com. If you are an existing AT&T customer with an iPhone, tethering your iPad requires jailbreaking your iPhone and downloading an App from the Rock Your Phone website. To find out more about jailbreaking your iPhone, read about it on Wikipedia, then check out MyWi ($9.99), an App that turns your iPhone into a mobile hotspot.
You can also tether popular Verizon phones, such as the Motorola Droid, by downloading Apps like WiFi Tether (which requires 'rooting' your Droid) or by using Verizon's mobile hotspot creator, MiFi. You can learn more about pay-as-you-go options for iPad by reading Rick Broida's excellent review of such devices.
Is jailbreaking your iPhone to save the extra cash on the iPad 3G worth it? Let us know what you think in the comments!