What Does Custom Software Maintenance Cost Per Year?

Introduction

The question of what custom software costs to build gets plenty of attention. The question of what it costs to maintain gets far too little, even though it often weighs more heavily over the lifetime of a system. Software is not a product you buy once and forget. It is more like a building: without maintenance the quality declines, even if you change nothing.

In this article we give an honest picture of maintenance costs, without making the numbers prettier than they are. We write this from our practice at MG Software, where we both build new systems and maintain existing applications. Want a first indication for your own situation? Our calculator gives a range, and below you can read where that range comes from.

Why maintenance is not an option but a given

Custom software never runs in isolation. It leans on dozens of external libraries, a database, a hosting environment, an operating system and often integrations with third-party systems. All of those parts move. Security updates appear, frameworks release new versions, and vendor APIs change or disappear. Standing still does not exist, even if your functionality stays the same.

The consequence is simple: software you do not maintain degrades on its own. Not because the code spontaneously breaks, but because the world around it shifts. A payment integration that works today can stop in a year because the provider turns off an old API. Maintenance is the work that keeps your software moving with those changes.

The rule of thumb: 15 to 20 percent per year

"Software you do not maintain does not get cheaper. It slowly becomes less secure, and eventually unmaintainable."

— Jordan Munk, co-founder MG Software

The software industry often budgets 15 to 20 percent of the original build cost per year for maintenance. For an application that cost 50,000 euros, that lands at roughly 7,500 to 10,000 euros per year. That is not a law, but a useful starting point that matches what we see in practice.

The rule of thumb is an average, not a guarantee. A simple internal tool with few integrations sits at the lower end. A platform with multiple integrations, many users and strict security requirements sits at the upper end, and sometimes above it in years when third parties make large changes. It helps to treat this as a fixed annual budget, not a surprise after the fact.

What maintenance actually covers

Maintenance is more than occasionally fixing a bug. It covers security updates of dependencies, updating frameworks and libraries, moving along with vendor API changes, monitoring and alerting, backup checks, and resolving errors that surface in production. On top of that come small improvements that make daily use smoother.

A frequently forgotten line item is hosting costs and external services. An average business web application has monthly costs for hosting, a database, email delivery, error monitoring and analytics. Those costs are recurring and belong in your maintenance budget, not in the one-off build cost.

What drives the cost up or down

Three factors largely determine where you land in the range. First, the number of integrations: every external connection is a component that can change and therefore needs maintenance. Second, the health of the codebase: a system with good test coverage and clear documentation is cheaper to maintain than an opaque codebase where every change is nerve-racking.

Third, the age and choice of the stack. Software running on modern, widely supported technology is cheap to maintain for years. Software on outdated or niche technology gets steadily more expensive, because there are fewer developers and updates become harder. If your system is running into this, our page on modernising legacy software is relevant.

Maintenance versus further development

It pays to distinguish maintenance from further development. Maintenance keeps the system healthy and secure. Further development adds new functionality because your business grows or changes. Both are valuable, but if you lump them together, something unfortunate happens: the moment there are no new features on the roadmap, maintenance stalls too.

That is why we often work with a maintenance plan that has a fixed number of hours per month for upkeep, and a separate budget for new functionality. That keeps the foundation healthy regardless of whether there are new requests that month. If you are building a product that keeps growing, also read how we support SaaS platforms and custom software over the long term.

What happens if you do not maintain

Not maintaining feels like saving in the short term. In the medium term it is the opposite. Technical debt piles up, dependencies fall out of date, and at some point nobody dares make a change because the consequences are unpredictable. At the same time security risks grow, because known vulnerabilities in old libraries are no longer patched.

The endpoint of neglected maintenance is almost always the same: a rebuild that costs many times more than structural maintenance would have. Skipping a few thousand euros per year sounds attractive, until three years later you face the choice of building everything again. Maintenance is therefore not a cost item, but insurance against a much larger expense.

Conclusion

Budget for maintenance from the start of every software project. A good rule of thumb is 15 to 20 percent of the build cost per year, with hosting and external services budgeted separately. Do not see it as an unpleasant surprise, but as the price of software that keeps running reliably and securely for years.

Want to know what maintaining your system realistically costs, or are you currently running software that could use some attention? Get in touch with MG Software. We look honestly at the state of your codebase and propose a maintenance plan that fits your budget.