Guide
Monthly or annual billing: which should you choose?
Annual plans look cheaper, and often are. Here is when paying monthly is still the better decision.
Almost every software pricing page shows two prices: a lower one if you pay for a year up front, and a higher one if you pay month by month. The annual price is the one in the headline. Which should you take?
What you gain by paying annually
A lower effective monthly price, usually somewhere between ten and twenty-five percent less, and one invoice a year instead of twelve.
What you give up
Flexibility. If the tool turns out not to fit, or your needs change in month three, you have paid for nine months you will not use. Refund terms on annual plans vary and are often limited.
Pay monthly when…
- You have not used the tool before.
- Your team size or list size is changing quickly.
- You are comparing two tools and have not decided.
Pay annually when…
- You have used the tool for a few months and it is working.
- Your usage is stable enough to pick the right plan size.
- The saving is meaningful for your budget.
A simple rule
Start monthly. Switch to annual after two or three months, once you know the tool has earned its place. The few extra dollars you pay early are the price of being able to walk away.