Lease vs. Buy Calculator
Leasing and buying are two ways to pay for the same thing: the value a car loses while you drive it. This calculator compares them over the same number of years — the total you pay to lease, against the total you pay to buy minus what the car is worth when you sell it.
The honest framing is that you pay for depreciation either way. Leasing fixes your cost and hands the car back; buying leaves you with an asset but exposes you to its resale value. The calculator shows the dollar difference so the trade-off is concrete.
Calculator
Over 3 years, buying costs less
$1,503
Buying saves this much vs. the other
Total to lease
$22,623
Net cost to buy
$21,120
Lease payment
$558.99
Loan payment
$726.98
Buying counts the car’s resale value at the end (about $25,206), which is why it usually wins over the long run. You pay for depreciation either way.
Calculation Formulas
Depreciation = (adjusted cap cost − residual) ÷ term; finance charge = (cap cost + residual) × money factor.
Key Figures
| Figure | Value | Description |
|---|---|---|
| Residual value | Set by the lessor | The car’s projected value at lease end; a higher residual lowers the lease payment. |
| Money factor | × 2,400 ≈ APR | The lease equivalent of an interest rate. |
Note: Results are estimates for planning purposes. Rates, fees, taxes, and insurance vary by lender and location — confirm exact figures with a licensed professional before making financial decisions.
Standards & Sources
Last verified: November 2026
- Consumer Leasing Act (Reg M)
Governs the disclosures in a consumer lease, including the amount due at signing and the basis for charges.
How to use this calculator
- Enter the car’s price and, for the lease, its money factor, residual value and term.
- For buying, enter your down payment, APR and loan term.
- Set how many years you plan to keep the car if you buy it.
- Read the total cost of leasing versus buying and the difference between them.
Frequently Asked Questions
Is it cheaper to lease or buy a car?
Over the same years, buying and selling is usually cheaper in total, because you keep the resale value. Leasing costs more but fixes your cost and hands the car back. The calculator shows the dollar difference.
Why do people say you pay for depreciation either way?
A lease charges you for the value the car loses while you drive it, plus a finance charge. When you buy, you pay the full price but recover the resale value — so both ways, depreciation is the real cost.
When does leasing make sense?
If you want a newer car every few years, a predictable cost, and you drive within the mileage limit, leasing can suit you — just know it usually costs more over the long run than buying and keeping.
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