Practical guide · verified against the real thing
Microsoft 365 free vs paid: what the free tier actually includes in 2026
In one line: Word, Excel and PowerPoint in your browser cost nothing — the official comparison, the storage math that decides most upgrades, and who the paid tiers are genuinely for.
The most common misconception in this space is that Office costs money, full stop. It hasn't for years: sign into Microsoft365.com with any Microsoft account and you get Word, Excel, PowerPoint, OneNote and Outlook as web apps, free, with 5 GB of OneDrive storage. That free tier is the correct answer for a large share of home users — the paid question is about three specific gaps.
The official comparison, plainly stated
Per Microsoft's own support comparison: the free web apps run in a browser, receive security updates but no new features, include 5 GB of OneDrive, and include no technical support. Microsoft 365 Basic (the cheapest paid tier) keeps the web apps but adds 100 GB of storage and ad-free email — it's a storage plan, not an apps plan. Personal and Family add the desktop apps for PC and Mac (installable on multiple devices, five signed in at once), 1 TB of OneDrive per person (Family covers up to six people, each with their own terabyte), ongoing feature updates, and support. Family's per-person arithmetic — six terabytes and six app installs for the household — is the quiet best-value move in the lineup if even two people use it. The top Premium tier layers the AI features; note Microsoft's own caveat that AI benefits stay with the subscription owner and don't share to Family members.
The three gaps that actually decide it
1. Web vs desktop apps. The web versions cover writing, spreadsheets and slides well for everyday work; the desktop versions matter when you need offline access, heavy files that strain browser limits, or specific power features. Most home users never hit this gap; power users hit it in week one.
2. The storage wall. 5 GB fills fast — one phone's photo backup alone can break it. This is the most common real reason people upgrade, and the honest comparison is against standalone cloud storage: price the Basic tier against what 100 GB costs elsewhere before assuming it's a bargain, and the Personal/Family tiers against whether your household actually uses the desktop apps.
3. Feature motion. Free tier gets security updates only; paid tiers get the new features as they ship. If your work depends on the latest Office capabilities, that's the paid signal.
The alternatives question, honestly
The free tier isn't the only free option: Google's web apps and LibreOffice (free desktop suite) both exist, and the honest comparison is its own piece — we've written the Docs vs Word vs Notion comparison separately. The lock-in angle matters too: documents saved in OneDrive's native formats move between these worlds better than they used to, but formatting fidelity on complex documents still favours staying put. The subscription-creep question is real here — Office is one of the line items worth an audit: our subscription audit piece walks the full habit — and note Microsoft has also kept lower-priced "Classic" plan variants (without the newer AI features) available in several markets, which their own support threads confirm. Check the pricing page the day you decide; prices have moved more than once recently.
The decision, in one line each
Light home use, online, documents and spreadsheets: the free web apps — genuinely enough. Need storage more than apps: Basic, priced against standalone storage rivals. Want desktop apps or 1 TB: Personal. Two or more people in the household: Family, the arithmetic winner. AI features that matter to your workflow: Premium, with the no-family-sharing caveat understood. Prices change — Microsoft's official comparison page is the first-party source of the day.
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