What Office 365 Is and Who Pays for It

Office 365 is a subscription service from Microsoft that gives you access to Word, Excel, PowerPoint, Outlook, and other productivity software. You pay a monthly or yearly fee, and Microsoft keeps the software updated automatically. Unlike buying Office once and owning it forever, a subscription means you keep paying as long as you want to use it.

Office 365 is not a housing or government benefit program. It is a commercial software service. If you are looking for free or low-cost software because of financial hardship, this article explains how the subscription model works — but you may want to explore whether your local library, school, or community center offers free access to Office tools instead.

Microsoft offers several versions of Office 365 under different names. The consumer version is now called Microsoft 365. Businesses and organizations subscribe to different plans. This guide focuses on what consumers and households need to know.

Key Takeaways

  • Microsoft 365 (the consumer version of Office 365) costs between $6 and $10 per month or $70 to $100 per year, depending on which plan you choose.
  • A subscription includes Word, Excel, PowerPoint, Outlook, OneDrive cloud storage, and access to Microsoft Teams, plus automatic updates.
  • You can use your subscription on multiple devices — typically up to 5 computers, tablets, and phones at the same time — but only one person owns the account.
  • If you stop paying, you lose access to edit documents, though you can still view them in read-only mode for a limited time.
  • Free alternatives exist: Microsoft Office Online (web-based, free), Google Workspace, and LibreOffice, though they have fewer features than the paid subscription.

Microsoft 365 Plans and What Each Costs

Microsoft offers two main consumer plans. Microsoft 365 Personal costs around $70 per year or $6 per month and covers one person on up to 5 devices. Microsoft 365 Family costs around $100 per year or $10 per month and covers up to 6 people, each with their own account and up to 5 devices per person.

Both plans include 1 terabyte of OneDrive cloud storage per person, which means you can save files online and access them from any device. Both also include Microsoft Teams for video calls and messaging, and both get new features and security updates automatically.

Microsoft also offers Office Home & Student, a one-time purchase (not a subscription) that costs around $150 and never expires, but it does not include cloud storage or Teams, and you do not get updates. This is an older model and is less common now.

Prices vary by country and change periodically. Microsoft often runs promotions, especially around back-to-school season and the winter holidays. You can see current pricing on Microsoft's website.

What You Can Do With a Subscription

A Microsoft 365 subscription gives you the full desktop versions of Word, Excel, PowerPoint, Outlook, Publisher, and Access (on Windows). On Mac, you get Word, Excel, PowerPoint, Outlook, and OneNote. You also get Office Online, which is a free web-based version you can use in any browser without downloading anything.

You can create, edit, and save documents in your own files or in OneDrive. You can share documents with others and work on them together in real time. Outlook lets you manage email, calendar, and contacts. Teams lets you video call, chat, and share screens with other people.

The subscription also includes access to templates, design tools, and premium fonts. You get technical support from Microsoft, though the level of support depends on your plan.

How to Set Up and Pay for a Subscription

To start a Microsoft 365 subscription, you create a Microsoft account (a free email address at outlook.com or a personal email you already own). You then choose which plan you want and enter a payment method — usually a credit card, debit card, or PayPal account.

Microsoft charges you automatically every month or year, depending on which billing cycle you chose. You can change your plan or cancel anytime. If you cancel, you lose access to edit documents, but you can still download and view them.

Some retailers and online stores sell Microsoft 365 gift cards or subscription codes. These work the same way as buying directly from Microsoft — you enter the code into your account and the subscription activates.

Using Your Subscription on Multiple Devices

A Microsoft 365 Personal subscription works on up to 5 devices at the same time. A Family subscription works on up to 5 devices per person, for up to 6 people. You sign in with your Microsoft account on each device, and the software activates automatically.

You can use the same subscription on a Windows computer, a Mac, an iPad, an iPhone, and an Android phone all at once. You can also use Office Online in a web browser on any device without installing anything.

If you try to use the subscription on a sixth device, you will be asked to remove it from one of the other devices. This is a technical limit, not a legal restriction — you are not breaking any rules by trying.

What Happens If You Stop Paying

If your subscription expires or you cancel it, you can still open and view your documents in Office for a limited time (usually 30 days). After that, you cannot edit them in the desktop versions of Word, Excel, or PowerPoint. You can still view them in read-only mode, and you can download them to your computer.

Your OneDrive files stay in your account for a limited time after your subscription ends. Microsoft typically gives you 30 days to download them before they are deleted. You can reactivate your subscription anytime and regain full access.

If you have a Family subscription and one family member stops paying their share, the account holder can remove them and add someone else.

Free and Low-Cost Alternatives

Office Online is a free web-based version of Word, Excel, PowerPoint, and OneNote. You can use it in any web browser with a free Microsoft account. It has fewer features than the desktop version, but it is enough for basic documents, spreadsheets, and presentations.

Google Workspace (formerly Google Docs, Sheets, and Slides) is also free and works in any browser. Many people find it easier to use for sharing and collaboration. It integrates with Gmail and Google Drive.

LibreOffice is a free, open-source office suite that works on Windows, Mac, and Linux. It is not made by Microsoft, but it can open and save Microsoft Office files. It has no subscription and no automatic updates — you download it once and own it.

Many public libraries offer free access to Microsoft 365 or other office software through their library card. Some schools and employers also provide free subscriptions to students and employees. It is worth asking before you pay.

Frequently Asked Questions

Can I use Microsoft 365 offline, or do I need internet?

The desktop versions of Word, Excel, and PowerPoint work offline — you can open and edit documents without an internet connection. However, you need internet to activate your subscription initially and to sync files with OneDrive. Office Online requires internet because it runs in a web browser.

What is the difference between Microsoft 365 and Office 2021?

Microsoft 365 is a subscription you pay for monthly or yearly. Office 2021 is a one-time purchase that never expires. Office 2021 is cheaper upfront but does not include cloud storage, Teams, or automatic updates. Most people now choose the subscription because updates and cloud storage are worth the ongoing cost.

Can I share my subscription with someone who is not in my household?

The Family plan is designed for people in the same household. Technically, you can sign in on someone else's device, but the terms of service say the subscription is for personal or household use only. Sharing with someone outside your home violates the terms.

Do I lose my documents if I cancel my subscription?

No. Your documents stay in your OneDrive account and on your computer. You can download them and open them in free software like LibreOffice or Google Docs. You just cannot edit them in the Microsoft desktop versions after your subscription ends.

Is there a student discount for Microsoft 365?

Yes. Students with a valid school email address can often get Microsoft 365 free through their school. Some schools include it in tuition; others require you to sign up separately. Check with your school's IT department or student portal. If your school does not offer it, you may may have access to for a discount through Microsoft's student program.