Office 2021 vs. Microsoft 365: Which should you buy?

If you are new to Microsoft Office or intend to upgrade the suite of apps, you will encounter two products, Office 2021 and Office apps from Microsoft 365, making the decision a little more difficult. Although both of these options provide access to the same set of apps, the difference is in the list of additional benefits and costs.

What you need to know about Microsoft 365

The paid service that has replaced Office 365 is known as Microsoft 365. The service has a new name, but it includes the same apps as Office 2021, as well as the benefits of the previous name. The only difference is that you will receive a slew of new bonuses.

Because this is a paid service, you will have to pay each month (or annually) to use the suite of apps, which includes Word, Excel, PowerPoint, Outlook, Publisher, Access, and others, on all of your devices (desktops, laptops, tablets, and phones). This is true as long as no more than five devices access the account at the same time.

In addition, if you purchase the Family subscription plan, you can share your account with up to five additional users, for a total of six people on one plan.

The most significant advantage is that you will never have to consider upgrades again. When you instal Office apps from Microsoft 365, you are always using the most recent version. This means that once installed, the apps will receive security and maintenance updates, improvements, and new features as soon as they are ready. For example, once available, the redesigned version of Office will be able to be installed on Windows 11 or Windows 10.

You can use the service to gain access to cloud-based features that will help you be more productive at school, at work, and across devices (Windows, macOS, iOS, and Android). Everyone on the plan will receive 1TB of OneDrive storage (up to 6TB with the Family subscription) and Skype minutes. The subscription also includes phone and chat support to help you resolve any issues.

If you have a lot of photos and videos, you can add up to 1TB of additional OneDrive storage in 200GB increments for an extra $1.99 per month, doubling the total storage capacity to 2TB (1TB already included with the plan and 1TB with the additional plan) for $9.99 per month. Members of Microsoft 365 Personal and Family can use this feature. If you have the Family plan, however, only the primary account holder will receive the additional storage.

Who should buy Microsoft 365?

If you want everything, Microsoft 365 is the best option because you can instal the apps on any device (Windows 11, 10, 8.1, and macOS). It's also the only option that offers ongoing updates at a low cost of ownership. Office 2021, on the other hand, only allows you to instal the apps on one computer running Windows 11 (or Windows 10), and upgrades must be purchased separately.

The cloud service is available in two flavours. If you are the only person who will use the apps and cloud services, the "Microsoft 365 Personal" plan is for you. It costs $70 per year (or $7 per month) and includes access to all apps as well as 1TB of OneDrive storage.

If, on the other hand, you intend to share your subscription with family or friends, the "Microsoft 365 Family" plan is the best choice. It costs $100 per year ($10/month), and you can share the benefits with up to six family members and friends (via the "Services & subscriptions" tab in your Microsoft account online), and everyone gets their own 1TB of OneDrive storage. They can also use the services on up to five different devices at the same time.

Regardless of the plan you choose, you will have access to additional services such as the Microsoft Family Safety experience, which allows you to manage screen time, app and game usage, share location, monitor driving behaviour for young drivers, and more.

Other premium features include Microsoft Editor for AI-assisted grammar checking, spelling, and writing style, as well as other AI-based creative tools. PowerPoint Presenter Coach, for example, allows you to practise presentations, and Designer allows you to create effective slide presentations. Resume Assistant is a fantastic tool for creating the best resumes in Word using insights from Microsoft LinkedIn. Money in Excel can also be used to view, track, and organise household finances. You will also receive creative content such as icons, fonts, stock photos, and premium Word, Excel, and PowerPoint templates.

The subscription also grants access to the premium version of the Outlook website, which includes everything available in the free version plus 50GB of storage, removes advertisements, and provides message encryption and enhanced security. You will also receive special offers from Microsoft partners as a paid member.

Some services included with Microsoft 365 are also available without a subscription through a Microsoft account, but you will only have access to limited functionalities that can be unlocked only through a subscription.

When selecting one of the subscriptions, go with the yearly plan to save money and avoid having to worry about payments for at least a year.

If you are a student or teacher, you can also use the service for free if you have a valid school email address. This plan includes free installation of Word, Excel, OneNote, PowerPoint, Microsoft Teams, and other school tools.

Windows 7 is no longer supported, so you'll need to upgrade to Windows 11 or, at the very least, Windows 10 to instal the apps.

What you need to know about Office 2021

Microsoft Office 2021 is the name given to the standalone version of the suite of apps, which does not require a subscription. This means that after the one-time purchase, you own the copy in perpetuity.

The standalone version of Office (also known as the "on-premises" or "perpetual" version) lets you instal and update the applications on a single computer. You cannot, however, upgrade to the following version. In other words, you can use the apps for the duration of their lifecycle (typically five years) and beyond (without updates). However, if you need to upgrade to a newer version in the future, you will have to buy the product all over again.

Office 2021 includes Word, Excel, PowerPoint, and Outlook (only on the business version), but it has fewer features and does not provide the same benefits as a Microsoft 365 subscription. For example, cloud and AI-based features, as well as other services such as the premium version of "Outlook.com" and 1TB of OneDrive cloud storage, are not available.

Who should buy Office 2021?

The Microsoft Office 2021 bundle was created for commercial customers with volume licences who are not ready for cloud-based apps and have specific needs to use the suite of apps on-premise. Anyone who does not want a subscription can, however, purchase this offering.

If you are a home user, this option is only viable if you can afford the initial investment and prefer a more traditional experience. It may also be a good option if you only intend to use the apps on one computer, do not require additional features, and are not ready for the Microsoft 365 subscription.

Although you only get one licence for one Windows 11, Windows 10, or macOS computer when you buy this product, you can instal the apps on your phone with limited functionality.

Office 2021 is available in three flavours: Office Home & Student 2021, Office Home & Business 2021, and Office Professional 2021, with prices starting at $150, $250, and $440, respectively. Word, Excel, and PowerPoint are included in Office Home & Student 2021, while Word, Excel, PowerPoint, and Outlook are included in Office Home & Business 2021. Word, Excel, PowerPoint, Outlook, Publisher, and Access are all included in Office Professional 2021.

Office 2021, unlike previous versions, is only compatible with Windows 11, Windows 10, and the three most recent versions of macOS. A Microsoft 365 subscription is required to instal Office on Windows 8.1.

Microsoft 365 vs. Office 2021: Which should you buy?

The final decision is determined by how much you require from the apps and other services. If you intend to use Office for a long time, Microsoft 365 is by far the best option. The reason for this is that you will have full access to the apps and benefits with the subscription at a low cost of ownership.