Lease vs Buy Calculator – Asset Comparison Tool
Compare total costs of leasing versus buying to find the best financial option.
Results are estimates for comparison purposes only. Consult a financial advisor for personalized advice.
Table of Contents
How to Use
- Enter the asset purchase price and how long you plan to use it.
- Input the buy scenario: down payment, loan interest rate, and term.
- Enter the lease scenario: monthly payment, term, and any down payment.
- Add optional costs like maintenance and insurance for accurate comparison.
- Click Calculate to see which option costs less over your usage period.
When buying makes sense
Buying is often better when you plan to keep the asset long-term, want to build equity, or need flexibility in how you use it. Ownership eliminates mileage restrictions and allows modifications.
- Long-term ownership: Lower cost per year over extended use.
- Equity building: Asset has value you can sell or trade.
- No restrictions: Use as much as you want without penalties.
- Customization: Modify the asset to suit your needs.
- Tax benefits: Depreciation deductions for business use.
When leasing makes sense
Leasing works well when you prefer lower monthly payments, want the latest models, or need flexibility to change assets frequently. It's also beneficial when you don't want maintenance responsibilities.
- Lower payments: Typically lower monthly costs than buying.
- Latest technology: Upgrade to new models regularly.
- Warranty coverage: Often covered for the entire lease term.
- Business flexibility: Easier to scale equipment up or down.
- No resale hassle: Return the asset at lease end.
Frequently Asked Questions
- Is it better to lease or buy a car?
- It depends on your situation. Leasing offers lower monthly payments and new cars every few years, but you never own the vehicle. Buying costs more monthly but builds equity and has no mileage limits. Use this calculator to compare your specific scenario.
- What is residual value and why does it matter?
- Residual value is what the asset is worth at the end of the loan or lease term. For buying, higher residual value means more equity. For leasing, it affects your monthly payment—higher residual value means lower payments.
- Should I include maintenance costs in the comparison?
- Yes, especially for longer ownership periods. When you buy, you're responsible for all maintenance after the warranty expires. Leases often include maintenance or keep you under warranty for the entire term.