Monthly vs. annual subscription calculator

From which month an annual plan pays off

The calculator compares two amounts for the same period: how much you pay if you pay every month, and how much for a whole year at once. The break-even point is the month when the annual plan becomes cheaper. The math is simple: if the year costs the same as ten months, the annual plan pays off from the eleventh month you use the service — but only if you use it all twelve.

So the most important field isn’t the price, it’s how long you plan to use the service. Many people fill it in optimistically — they type twelve even though they used the same service for half a year last year. An honest number often flips the result.

Three things that change the answer

A promo price for the first months. If the first months are cheaper, the monthly plan costs less over the year than the regular price suggests — the calculator has separate fields for how long the promotion lasts and the price afterwards.

A cancellation fee. A contract with a minimum term and a lower monthly price may charge a fee if you cancel early; enter it and you’ll see whether the discount is worth the commitment.

Refunds when you cancel early. In most terms we’ve gone through, the money for the remaining time on an annual plan isn’t refunded unless the law requires it. An annual plan is a bet that you’ll use the service all year — if you lose it, you pay for unused months.

When an annual plan usually doesn’t pay off

• when the service is seasonal — sports broadcasts, a course before an exam, a gaming subscription for a single title;
• when you don’t know yet whether you’ll stick with the service: the first month is the cheapest test, the annual plan the most expensive;
• when the service simply doesn’t offer an annual plan in the US — then the question answers itself.

When it pays off

When you use the service every day and for longer than a year. Once you’ve paid for a year, a price increase during that year doesn’t affect you — an advantage only when prices go up; what has recently become more expensive or cheaper is collected under price changes.

And one last check before you pay for a year: how to turn off auto-renew. Annual plans usually renew automatically — just like monthly ones, only the amount is several times larger and nobody is obliged to remind you about it.