📖 Overview
Decide whether it is mathematically better to lease or buy your next car by comparing lifetime costs.
🧪 Example Scenarios
Use these default and higher-pressure example inputs to explore how sensitive this calculator is before using your real numbers.
| Input | Base Case | Higher Pressure Case |
|---|---|---|
| Car Price ($) | 30,000 | 36,000 |
| Lease Monthly ($) | 400 | 460 |
| Lease Terms (months) | 36 | 41.4 |
| Buy Loan Term (months) | 60 | 69 |
| Buy Interest (%) | 5 | 6 |
⚙️ How It Works
Compares the total cash outlay of leasing a vehicle over a specific term versus purchasing with an auto loan, helping you understand the total cost commitment of each option.
The Formula
Lease Cost = Monthly Payment × Term | Buy Cost = Loan Payment × Loan Term
💡This calculator is scenario-based. Better input quality leads to better decision quality.
Quick Reference
| Input | Example Value |
|---|---|
| Car Price ($) | 30000 |
| Lease Monthly ($) | 400 |
| Lease Terms (months) | 36 |
| Buy Loan Term (months) | 60 |
| Buy Interest (%) | 5 |
When To Use This
- Use this tool when you need a fast decision during active planning or execution.
- Use this before committing money, time, or tradeoffs that are hard to reverse.
- Use this to compare options using the same assumptions across scenarios.
Edge Cases To Watch
- Results can be misleading if key inputs are missing, stale, or unrealistic.
- Very small or very large values may amplify rounding effects and interpretation risk.
- If assumptions change mid-decision, recalculate before acting.
Practical Tips
💡 Buying builds equity while leasing does not — factor in the car's resale value when comparing total cost.
💡 Leasing is generally preferable if you value lower monthly payments and always driving a new car.
💡 Buying is often better long-term if you plan to keep the car for 5+ years after paying it off.
Frequently Asked Questions
❓ Does leasing ever make financial sense?
Yes, especially for business owners who can deduct lease payments, or those who prioritize flexibility and predictable costs.
❓ What happens at the end of a lease?
You can return the car, purchase it at the agreed residual value, or lease a new vehicle.