What paying a year up front really costs: the premium for monthly, the break-even month and the interest rate the discount works out to.
Arithmetic only — not tax, accounting, legal or investment advice. Check against current rules.
Annual vs monthly billing: Paying a year up front is a loan to the vendor. The extra cash out on day one buys the eleven monthly bills that never come, and the rate that makes the two equal is what the discount pays. Monthly is billed at the start of each month; break-even is the fewest whole months at which the annual price is no more than the monthly one.
Quoted from the toolbelt spec, the document this tool was built against.
Negatives are parenthesized because that’s what a statement does. The rest is four promises.
Amounts are integers in the currency's smallest unit, end to end. A float never touches a cent.
Rounded once, at the end. Rounding each operand is how a split stops summing to the whole.
The arithmetic lives in one unit-tested module, and the extension uses the same one.
There is no request to make. What you type stays in this tab and is gone when you close it.
A calculator answers the question once. These carry the answer into a product, name what it computed, and argue the method.
Worked example. Type over it.
Result
Paying 905.00 more on day one saves the other eleven monthly bills. The discount is worth that much a year on the cash you hand over early. If your cash earns or costs you less than this, annual wins, as long as you will use the tool all year.
| Months used | Monthly plan | Annual plan | Cheaper |
|---|---|---|---|
| 1 | 95.00 | 1,000.00 | Monthly |
| 3 | 285.00 | 1,000.00 | Monthly |
| 6 | 570.00 | 1,000.00 | Monthly |
| 9 | 855.00 | 1,000.00 | Monthly |
| 12 | 1,140.00 | 1,000.00 | Annual |
Assumes the monthly plan bills at the start of each month and the annual plan does not refund. Check your order form for both.