Is Amazon Prime Really Worth It?

Amazon’s biggest sale of the year, Prime Day, will take place in July. Although the exact dates aren't set yet, you can expect early deals to roll in soon. And to take advantage of everything the sale has to offer, you’re going to need to be a Prime Member.

Millions of Amazon Prime users currently pay $14.99 per month or $139 per year for their memberships. For frequent Amazon shoppers, Prime can pay for itself quickly—mostly thanks to the shipping perks. But it may not make financial sense for infrequent users. If you’re on the fence about signing up for (or renewing) your Prime membership, here’s how to judge whether or not the benefits outweigh the $139 cost for you.

The benefits of Amazon Prime

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

• Free two-day shipping on millions of items: This is the main draw of Prime. If you shop frequently on Amazon and want quick free delivery, the shipping perks alone may make Prime worthwhile. Prime members also get free same-day delivery on over 3 million items in eligible areas. The ultra-fast (and morally dubious) shipping usually costs $9.99 per order for non-members.

• 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 could still add value.

• Other Prime benefits: You also get Prime Music for streaming songs, Prime Reading for ebooks and magazines, Prime gaming, free photo storage, and discounts/deals.

• Amazon Prime Rewards Visa card: Cardholders get 5% back on Amazon/Whole Foods purchases. So Prime members who use this card extensively can earn rewards that offset the annual fee.

• Number of users: Prime benefits can be shared with other members of your household. The more users, the more value per person.

Doing the math

Browsing around on my non-shared, non-Prime Amazon account, I see that shipping costs typically run 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 option. So, we have the cost of individual online orders (around six bucks a pop) compared to the free delivery that comes with an $139 annual fee. This means the costs you’d save on shipping become worth the the cost of Prime so long as 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 has $25-35 or more of eligible items; however, your order will take five to eight days to be delivered.

The bottom line

Prime tends to provide good value for those who shop frequently on Amazon (over 23 times per year) or regularly use the other Prime perks like video streaming. Conversely, it may not be worthwhile for those who rarely shop on Amazon or won’t use the other benefits. Consider your usage and compare the $139 annual fee to the value you’d get from the free shipping and other Prime features.

Of course, you can always sign up now and then cancel your membership after Prime day is over—but Amazon doesn't make it easy on you. For more information about deals and discounts, keep an eye on all of Lifehacker’s Amazon Prime Day coverage.