How to price a SaaS at $1–5 a month without losing money

Pricing a SaaS at $1–5 a month can work, but only for certain products. This guide covers how to price a SaaS that cheap: when it works, what payment fees take from each charge, when yearly or pay once beats monthly, and what a small pricing page needs. Fees quoted here are as of October 2026.

The short version: a $1 monthly charge loses 34–56% to fees on most providers. At $3–5 the loss drops to roughly 10–22%. Yearly billing and pay once fix most of the problem.

When a $1–5 price works

A tiny price is a product decision. It suits some apps and quietly ruins others.

It tends to work when:

• Running costs per user are close to zero. A browser extension, a static-site tool, a utility that runs on the user's device, or an app on SQLite where each user is a few kilobytes of data.
• Support needs are low. If one support email a year costs you 20 minutes, a $2 customer can still be worth it. If every user needs onboarding calls, it cannot.
• The job is narrow and clear. "Convert receipts to a spreadsheet" sells at $3. "All-in-one workspace" at $3 makes people suspicious.
• There is a well-known tool that costs 5–10 times more. People already know what the job is worth. You only have to show you do the part they need.
• You can reach people cheaply. At $3 a month you cannot pay for ads. Search, word of mouth, directories and communities have to carry it.

It tends to fail when:

• Each user triggers paid API calls, such as large language model requests, SMS, or heavy compute. Usage can outrun a flat $3.
• The buyer is a company with a procurement process. A $2 line item costs them more to approve than to pay.
• You need the revenue to pay a salary soon. At $3 a month, 1,000 paying users is about $2,350–2,600 a month after fees, depending on the provider.

The fee math per transaction

Most payment providers charge a percentage plus a fixed amount per charge. The fixed amount is what hurts small prices. Here is what you keep from one monthly charge on the base domestic card rate, as of October 2026. Full sources and caveats are in Payment fees on $1–5 subscriptions.

On a $1 charge, the fixed fee alone is 30–50% of the price. On a $5 charge, the same fixed fee is 6–10%. Paddle and Lemon Squeezy both say they offer custom pricing for products under $10, so ask before you launch.

Two things make it worse. International cards usually add about 1.5%. And merchant-of-record providers such as Paddle handle sales tax for you, which is worth a lot, but the tax comes out of your price unless you add it on top.

A useful rule: if the fixed fee is more than 15% of your price, bill less often.

Monthly vs yearly vs pay once

The fixed fee is charged per transaction, not per customer. Fewer transactions means fewer fixed fees.

Using Stripe's base rate as of October 2026:

A $10 yearly plan keeps more than twelve $1 monthly charges, even though it bills $2 less. On Paddle the gap is wider: $9.00 kept against $5.40.

How to choose:

• Under $3 a month: lead with yearly. Show it as "$10 a year" with "$0.83 a month" underneath, not the other way round.
• $3–5 a month: offer both. Monthly lowers the first-purchase barrier. Yearly at about 10 months' price is a common pattern and covers your fees.
• Pay once: good for tools with near-zero running costs and no ongoing service, such as a desktop app, a template or an extension. Price it so it still makes sense if a user stays five years. If the app depends on your servers, plan for the cost of serving pay-once users for years. Many makers cap pay-once at a set number of seats, or offer it only for a version, with paid upgrades for major new versions.

On One Dollar SaaS, a pay-once price can be up to $49.

Free tiers

A free tier is a marketing cost. At $1–5, it is often the largest one you have.

• Free should be useful but bounded. Limit it by something that grows with real use: number of projects, items, exports, or history length. Avoid limits that make the free version feel broken.
• Count what a free user costs you. If 95 of 100 users stay free and each costs $0.05 a month to serve, five paying users at $3 cover that easily. If each free user costs $0.50, they do not.
• A trial can replace a free tier. For a product that is obviously useful within a week, a 7- or 14-day trial without a card is simpler to run.
• "Free to start" plus one paid plan is the easiest structure to explain.

Keep the top plan small

Cheap apps often add a $29 "Pro" plan to look serious. Usually this backfires. It tells visitors the real price is $29 and the $3 plan is a teaser.

A cleaner pattern:

• One or two paid plans.
• The top single-user plan at no more than 2–3 times the entry plan. For example: $3 and $7.
• Team or business plans, if you need them, on a separate tab or page.

On One Dollar SaaS, the cheapest paid entry must be $5 a month or less and single-user plans must stay at or under $10 a month. Team plans are excluded from that cap.

Anchor against the price people already know

Most cheap apps are swaps for a well-known tool. Visitors already know that tool's price. Use that, carefully.

• State the comparison plainly, with a date. For example: "[Big tool]'s plan is $10 a seat a month (checked October 2026). This is $3." Link to their pricing page.
• Compare like with like. Compare your plan to the plan that does the same job, not to their enterprise tier.
• Say what you do not do. "No real-time collaboration" builds more trust than pretending to match every feature.
• Show the yearly difference. "Keep $84 a year" is clearer than "70% cheaper".
• Recheck their price. Big-name prices change. An out-of-date comparison makes you look careless, and in some places it can be a legal problem.

Patterns that work at this price

These are common structures, not promises of revenue.

• One price, one plan. "$3 a month or $30 a year. Everything included." Fewest decisions, fewest support questions.
• Free to start, one paid plan. Free with a limit, paid removes the limit.
• Pay once for the app, optional yearly for sync. The local app is a one-time purchase. Cloud sync or updates are a small yearly fee.
• Yearly only. "$12 a year." This removes the monthly fee problem entirely, at the cost of a slightly higher first payment.
• Regional pricing. Some providers support local currency or purchasing-power discounts. Useful if many of your users are outside the US and Europe, but it adds support work.

Pricing-page checklist

Before launch, check your pricing page against this list. More launch steps are in the launch checklist for a vibe-coded app.

1. Every plan is shown, including free, with the real price in a real currency.
2. The billing period is clear: "a month", "a year" or "pay once".
3. Whether tax is included or added at checkout is stated.
4. Limits for each plan are listed in numbers, not "generous" or "unlimited*".
5. The yearly plan shows the per-month equivalent and the yearly total.
6. The refund policy is one or two sentences and linked from the page.
7. How to cancel is stated, and cancelling takes fewer than three clicks.
8. If you compare with a well-known tool, the comparison is dated and linked.
9. The page loads without signing in.
10. The checkout matches the page: same price, same currency, no surprise fees.

Running costs

Low prices only work with low costs. For stacks that cost $0–5 a month, see How to host a SaaS cheaply. For the full fee comparison across Stripe, Paddle, Lemon Squeezy, Polar, Dodo Payments and Razorpay, see Payment fees on $1–5 subscriptions.

List your app

If your app costs $5 a month or less to start, you can list it on One Dollar SaaS for free.