Phase 10 · Auto & Mobility
Lease vs Buy a Car Calculator
The lease payment is lower — but you own nothing at the end. Compare both over the same period, counting the resale value buying leaves in your driveway, to find the real cheaper option.
Under the hood
The math, fully exposed
We total each path over the same period, then subtract the equity buying leaves you:
Buy payments = monthly loan payment × months (60-month loan)
Equity = price × resale % − remaining loan balance at period end
True cost to buy = down + buy payments − equity
True cost to lease = lease payment × months
- Equity is the buyer's reward: subtracting the car's resale value (minus any loan left) is what makes the comparison honest, not just "which payment is lower."
- Resale drives the verdict: a car that holds its value tilts hard toward buying; one that depreciates fast narrows the gap.
- Keep it longer and buying wins more: past the loan, the buyer pays nothing but upkeep while the leaser keeps paying forever.
Your directives
What to do next, based on your numbers
Adjust the sliders to generate tailored recommendations.
Answers
Frequently asked questions
Is leasing or buying a car cheaper?
Over a single lease term, leasing often has the lower monthly payment — but you end with nothing, while a buyer ends owning a car with resale value. The honest comparison nets that equity against the buyer's costs. Buying almost always wins if you keep the car well beyond the loan; leasing can win if you always want a new car every few years and value the lower payment over ownership.
How does this calculator make it a fair comparison?
It measures both options over the same period and counts what you have at the end. The lease cost is simply the payments made. The buy cost is your down payment plus loan payments, minus the equity you hold — the car's resale value at that point less any loan balance still owed. Subtracting that equity is what turns "the payment is higher" into the real, all-in cost of each path.
Why does resale value matter so much?
Because it is the entire financial case for buying. A car that holds 60% of its value after three years hands the buyer a large asset the leaser never gets; a car that craters to 40% narrows or erases the gap. Resale value is the single biggest swing factor here, which is why it is an input you control — brands and models vary enormously in how they depreciate.
When does leasing actually make sense?
When you genuinely want a new car every two to three years, want predictable costs under warranty with no resale hassle, can use it as a business deduction, or the specific lease deal is unusually good. For most people who keep cars a long time, buying and driving it well past the loan is cheaper per year. Mileage limits and wear charges can also add lease costs this model does not include. Educational only — not financial advice.