Self-editing is the practice of editing your own manuscript to the best of your ability, prior to submitting it to a freelance editor, agent, or publisher. Every author approaches self-editing differently depending on skill level, but any self-editing that can be done will help save time and money in the overall publishing process. Per author and freelance editor Jason Schmetzer, most authors are capable of doing basic copyediting and proofreading, which includes grammar, typos, and punctuation. Schmetzer recommends waiting until a first draft is complete before tackling any deeper edits like developmental and line editing, which look at story structure and styling. In his own writing, Schmetzer does tend to copyedit as he goes, but does not go beyond that until he has a finished draft. Saving major rewrites until the end will allow you to catch more errors and inconsistencies. While word processing software like Microsoft Word can identify common spelling errors, Schmetzer recommends upgrading to a software such as Grammarly for more accuracy.
I agree with Mr. Schmetzer's comments about the different editing software pitfalls. I work in the legal profession where word usage, punctuation and grammar are critical. As Mr. Schmetzer pointed out, spellchecking in Word cannot replace proofreading. For example, "...by this Agreement, Smith shall now pay..." is different than "...by this Agreement Smith shall not pay..." Word will accept either word without consideration of its meaning, simply because they are spelled correctly. The results could be disastrous. Grammerly, as Mr. Schmetzer pointed out, it does a better job of punctuation and meaning. As I recall it has a thesaurus component for words that it flags, e.g., did you intend to use "differ" or "defer." As Mr. Schmetzer also pointed out, one of Grammerly's flaws is that it does not take style into consideration (short paragraphs, truncated sentences). It considers the English style of the comma to be "apples, grapes, and bananas" (note the comma after grapes). I generally do not use the extra comma before the "and," but Grammerly catches it every time and marks it as a critical error, which can be annoying. Neither Word nor Grammerly can replace proofreading.
I agree with everything Peggy says above, however, Grammarly is very expensive. $59.95 4 x a year. Believe me, it adds up pretty quickly. I would suggest waiting until your final draft and then signing up for Grammarly. Word has gotten much better at 'proof-reading' than it was in the past.