If you just want to replace a home phone with a smartphone that makes calls over wifi. You won't need a mobile plan or MIFI.
Here's how to do it.
1) Get a Google Voice phone number.2) Go to the Settings page in Google Voice. Make sure Google Chat is checked on the Phones tab.
3) Install Talkatone on your Android or iOS device, or both. Yes iPad and Android tablets work.
4) Start up Talkatone and use the same Google account as your Google Voice account.
5) Done. Make and receive calls using Talkatone.
If you are using a tablet or don't want to do speakerphone only calls pick up a good pair of earbuds with a microphone, a bluetooth headset, or one of these wired or bluetooth handsets. (Click em to find them at Amazon)
Edit: Yes, you can send and receive SMS text messages this way. MMS (picture or multimedia messages) do NOT work and will be silenty dropped and never reach you. Google is already working on this and has some support for people sending MMS to a Google voice number. MMS originating from other providers, not
Edit2: Saving power. This could bite you. Most, if not all smart phones will turn off WIFI after inactivity. This means you will not receive calls once it is disconnected. That's kind of a bummer since forcing WIFI to stay on will eat your battery. So, clearly this solution isn't perfect.
Edit3: Upon investigating the talkatone website there is a setting that will keep the wifi connected.