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Glossary

Fixed-term contract

A fixed-term contract runs for a set period, such as one or three years, and ends or renews when that period is over.

Why it matters to a budget owner

Fixed terms are common for subscriptions and multi-year deals. Leaving before the end usually costs the remaining fees or an early termination charge.

A fixed term may still auto-renew. Check what happens at the end: does it stop, renew for the same term, or roll month to month?

What to record

  • Start and end dates
  • What happens at the end
  • Any early termination right or charge

Frequently asked questions

Can I leave a fixed-term contract early?

Only if the contract gives you a right to, often with a charge. Without one, you normally owe the fees for the rest of the term.

General working knowledge about commercial contracts, not legal advice. Your own agreement governs.

Glossary

Look up related terms

  • Evergreen contractAn evergreen contract has no end date. It runs until one side ends it, usually by giving notice.
  • Early termination feeAn early termination fee is what you pay to end a contract before its term is over, often a share of the remaining fees.