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Timing of reproduction in a seasonal cycle is a life history trait with important fitness consequences. Capital breeders produce offspring from stored resources and, by decoupling feeding and reproduction, may bend the constraints caused by seasonality in food or predation. Income breeders, on the other hand, produce offspring from concurrent food intake, with the disadvantage of less flexibility, but with high efficiency and no inventory costs of carrying stores. Here, we assess relative profitability of capital and income breeding in herbivorous zooplankton inhabiting seasonal, high‐latitude environments. We apply a state‐dependent life history model where reproductive values are used to optimise energy allocation and diapause strategies over the year. Three environmental scenarios were modelled: an early, an intermediate, and a late feeding season. We found that capital breeding was most important in the early season. Capital breeding ranged from 7–9% of the eggs produced but, because of the high reproductive value of early eggs, capital breeding ranged from 9–30% when measured in terms of reproductive value. The main benefit of capital breeding was reproduction prior to the feeding season – when the reproductive value of an egg peaked. In addition, capital breeding was also used to increase egg production rates at times of income breeding. For individuals born late in the season the model predicted a two‐year cycle instead of the typical annual life cycle. These individuals could then reap the benefits of early reproduction and capital breeding in their second year instead of income breeding late in the first year. We emphasize the importance of evaluating reproductive strategies such as capital and income breeding from a complete life cycle perspective. In particular, knowing the seasonality in offspring fitness is essential to appreciate evolutionary and population‐level consequences of capital breeding.