Is Amazon Prime Really Worth It?

Amazon announced that “Prime Big Deal Days,” an exclusive savings event for Prime members, will run from October 10 at 3 a.m. ET until October 11. month or $139 per year for membership.

For regular shoppers, Amazon Prime can quickly pay for itself thanks to its shipping benefits. But for infrequent users, this may not make financial sense. If you’re on the fence about signing up or renewing for a Prime membership, here’s how to evaluate whether the benefits outweigh the $139 cost for you.

Is Amazon Prime Really Worth It?

Before you do the math, here are the main benefits of Amazon Prime that make it worth the cost for so many users.

• Free two-day shipping on millions of items: This is Prime’s biggest selling point. If you shop on Amazon frequently and want fast, free shipping, the shipping benefits alone may make Prime worthwhile.
• Access to Prime Video: Prime includes unlimited streaming of movies, TV shows, and Amazon Originals. If you ask me, the content library isn’t as robust as Netflix or Hulu, but it can still provide value.
• Other Prime benefits: You also get Prime Music for song streaming, Prime Reading for e-books and magazines, Prime games, free photo storage and discounts/offers. These extras sweeten the deal.
• Amazon Prime Rewards Visa Card: Cardholders earn 5% back on Amazon/Whole Foods purchases. This way, Prime members who actively use the card can earn rewards that offset the annual fee.
• Number of users: Prime benefits can be shared with other members of your family. Thus, the more users, the greater the “value per person”.

Let’s do the math

Looking at my private non-Prime Amazon account, I see that shipping costs are typically around six dollars per item. Of course, shipping costs will vary depending on the item and how quickly you want it, but let’s compare the cost to the appeal of Prime’s two-day shipping. So we have the cost of individual online orders (about six dollars apiece) versus free shipping, which comes with an annual fee of $139. This means the cost you save on shipping will be worth the cost of Prime if you order online more than two dozen times a year.

Important note: You can get free shipping from Amazon without a Prime membership when your order contains eligible items valued at $25-$35 or more; however, it will take five to eight days for your order to arrive.

Bottom line

Prime generally provides good value for those who shop Amazon frequently (more than 23 times a year) or regularly use other Prime benefits such as video streaming. Conversely, it may not be useful for those who rarely shop on Amazon or don’t take advantage of other benefits. Consider your usage and compare the $139 annual fee to the value you’ll get from free shipping and other Prime features.

For more information on deals and discounts, follow all ofLifehacker’s Amazon Prime Day coverage.