Lease vs Buy Calculator
Compare what a car really costs to lease versus buy over the same period. Buying costs more upfront but leaves you an asset to resell; leasing is lower monthly but you own nothing at the end. This weighs both fairly.
How to use this calculator
- Enter the car price and the comparison period in years.
- Fill the lease terms (monthly + upfront) and the buy terms (deposit, loan APR).
- Set a realistic resale value % — this is the value you keep by buying.
Formula used
The fair comparison subtracts the resale value from buying's total, since that's an asset you keep. Loan repayments are amortised at the given APR. Leasing's total is simply all payments, because you return the car and keep nothing.
Example calculation
30,000 car over 3 years. Lease: 2,100 + 350×36 = 14,700 (own nothing). Buy: 6,000 deposit + 741/mo on the 24,000 loan at 7% = 32,678 paid, minus 15,000 resale = ~17,678 net.
Here leasing edges it by ~3,000 — but nudge the resale up (cars often hold more than 50% after 3 years), drop the APR, or keep the car past the loan and buying pulls ahead.
The real lease-versus-buy trade-off
The headline monthly figures mislead because they compare different things: a lease payment buys temporary use, while a loan payment builds toward ownership. The only fair comparison nets out the resale value — the chunk of the car's worth you still hold when you buy — against buying's higher total outlay. Do that, and buying usually costs less over the full period, because you're not paying someone else's profit margin on the depreciation.
But cost isn't the whole decision. Leasing buys predictability and convenience: fixed payments, warranty cover, no resale hassle, and easy upgrades to a new car every few years — at the price of mileage limits, condition charges, and owning nothing. Buying rewards those who keep cars long past the loan, drive high mileage, or want an asset, but ties up cash and carries the resale risk. This calculator settles the money question; the lifestyle factors are yours to weigh on top.
Why use this calculator?
- Compare leasing and buying on true total cost, not just monthly.
- Credits buying with the resale value you keep.
- Includes loan interest so the buy side is realistic.
Frequently asked questions
Is it cheaper to lease or buy a car?
Over the full period, buying is usually cheaper because you keep the car's resale value, while leasing pays only for use. But leasing has lower upfront cost and predictable payments. This calculator compares the true net cost of each.
Why include resale value when buying?
Because it's real money you get back. Buying's total payments look higher than leasing, but selling the car afterward returns a large share of the value — often making the net cost lower than leasing, where you keep nothing.
When does leasing make more sense?
If you want a new car every few years, value predictable costs and warranty cover, drive within the mileage limits, and prefer not to tie up cash or deal with resale. Leasing trades higher long-term cost for convenience and flexibility.