Microsoft 365 is a subscription that gives you access to Office apps and cloud storage

Microsoft 365 (formerly called Office 365) is a monthly or yearly subscription that lets you use Word, Excel, PowerPoint, Outlook, and other Office applications on your computer, tablet, or phone. Instead of buying Office once and owning it forever, you pay a recurring fee and get access to the latest versions of these programs, plus cloud storage through OneDrive and other services bundled in.

The subscription model means Microsoft updates the apps automatically, adds new features regularly, and you can install Office on multiple devices depending on which plan you choose. When your subscription ends, you lose access to editing and creating new documents, though you can still view files you've already made.

Key Takeaways

  • Microsoft 365 subscriptions come in different tiers — Personal, Family, and business plans — each with different numbers of devices, storage amounts, and included services.
  • You pay monthly or yearly, and the subscription renews automatically unless you cancel it before the renewal date.
  • All plans include the core Office apps (Word, Excel, PowerPoint, Outlook) plus OneDrive cloud storage and access to Microsoft Teams.
  • You can install Office on multiple devices at once, but the number of simultaneous users or devices depends on which plan you buy.
  • If you stop paying, you can still open and view your documents, but you cannot edit or create new ones until you renew.

The different Microsoft 365 plans and what each includes

Microsoft offers several subscription tiers. Microsoft 365 Personal is for one person and costs a set amount per month or year. It includes Word, Excel, PowerPoint, Outlook, Access, and Publisher, plus 1 TB of OneDrive storage. You can install it on up to five devices (computer, tablet, phone) and use it on all of them at the same time.

Microsoft 365 Family covers up to six people in one household. Each person gets their own account, their own 1 TB of OneDrive storage, and can install Office on up to five devices. The monthly cost is higher than Personal, but the per-person cost is lower if you have multiple users.

Business plans — Microsoft 365 Business Basic, Business Standard, and Business Premium — are priced per user per month and include Office apps, cloud storage, email hosting through Outlook, and Teams for video calls and chat. These are meant for small to medium companies and include admin tools and security features that personal plans do not.

There is also Microsoft 365 Apps for enterprise, which is just the Office applications without email or Teams, and is sold to large organizations through volume licensing.

How billing and renewal work

When you buy a Microsoft 365 subscription, you choose to pay monthly or annually. Monthly subscriptions renew automatically on the same day each month. Annual subscriptions renew on the anniversary of your purchase date. Your payment method (credit card, debit card, or PayPal) is charged automatically unless you cancel before the renewal date.

You can cancel your subscription at any time through your Microsoft account settings. If you cancel mid-cycle, your access continues until the end of the current billing period — you do not get a refund for the unused portion. If you want to pause your subscription temporarily, you can cancel and then resubscribe later without losing your files.

Microsoft sometimes offers discounts for annual plans compared to paying month-to-month. The exact price varies by region and changes periodically, so check the Microsoft website or your account page to see current rates.

Installing Office on your devices

After you purchase a subscription and sign in with your Microsoft account, you can read and install Office from the Microsoft website or the Microsoft Store. On a Windows computer, you run the installer and sign in with the email and password you used to buy the subscription. On a Mac, the process is similar — read from the Microsoft website, run the installer, and sign in.

For tablets and phones, you read the individual Office apps (Word, Excel, PowerPoint, Outlook) from the Apple App Store or Google Play Store, then sign in with your Microsoft account. On mobile devices, basic editing is free, but full features require an active subscription.

If you reach the device limit for your plan, you can remove an old device from your account and install Office on a new one. You manage which devices are linked to your subscription in your Microsoft account settings under "Devices."

OneDrive storage and file syncing

Every Microsoft 365 subscription includes cloud storage through OneDrive. Personal and Family plans include 1 TB per user. Business plans include 1 TB as well, though some business plans can be upgraded to more storage for an additional fee.

OneDrive works by syncing files between your computer and Microsoft's servers. You can save files directly to OneDrive through Office apps, or you can use the OneDrive folder on your computer like any other folder — files you put there automatically upload to the cloud. This means you can access your documents from any device, and if your computer fails, your files are still safe in the cloud.

You can share OneDrive files with other people by sending them a link or inviting them to collaborate. Shared files can be edited by multiple people at the same time, and changes appear when ready for everyone viewing the document.

What happens when your subscription ends

If you do not renew your subscription, your access to editing and creating documents ends on the renewal date. You can still open and view files you created, but you cannot make changes, save new versions, or create new documents. The Office apps will show a notification that your subscription has expired.

Your OneDrive files remain in your account for a limited time after your subscription ends. Microsoft typically holds your files for 90 days, but you should not rely on this — if you plan to stop subscribing, read your important files to your computer first.

If you resubscribe later, your files return to full editing access and your OneDrive storage is restored. There is no penalty for letting a subscription lapse and then restarting it.

Comparing Microsoft 365 to buying Office once

Microsoft also sells Microsoft Office 2024 (or other standalone versions) as a one-time purchase. You pay once, install it on one computer, and own it permanently. However, you do not get automatic updates, cloud storage, or access to new features as they are released. After several years, the software becomes outdated and Microsoft stops supporting it.

A subscription costs more over time if you keep it for many years, but you always have the current version, automatic updates, cloud storage, and the ability to use Office on multiple devices. A one-time purchase is cheaper upfront if you only need Office on one computer and do not mind using an older version eventually.

Frequently Asked Questions

Can I use Microsoft 365 on a Mac?

Yes. Word, Excel, PowerPoint, Outlook, and other Office apps work on Mac computers. read them from the Microsoft website or the Mac App Store, sign in with your Microsoft account, and they work the same way as on Windows. The subscription covers both Windows and Mac devices.

What is the difference between Microsoft 365 Personal and Family?

Personal is for one person on up to five devices. Family covers up to six people, each with their own account and 1 TB of storage, and each person can use Office on up to five devices. Family costs more per month but is cheaper per person if you have multiple users in your household.

Do I need an internet connection to use Office with Microsoft 365?

You need internet to sign in and set up your subscription, but after that, you can use Word, Excel, and PowerPoint offline. Changes sync to the cloud when you reconnect. Outlook requires internet to send and receive email, but you can read cached messages offline.

Can I share my Microsoft 365 subscription with someone else?

With a Personal subscription, no — it is licensed to one person. With a Family subscription, yes — you can add up to five other people, and each gets their own account and storage. Each person signs in with their own Microsoft account to use the shared subscription.

What happens to my files if I cancel my subscription?

Your files stay in your OneDrive account for about 90 days. You can read them to your computer anytime. After 90 days, Microsoft may delete them, so do not wait if you plan to cancel — read your important files first.