Knowledge Base

Lease vs Buy Calculator

Compare NPV of Lease Payments vs Net Cost of Ownership

Leasing has lower monthly payments but you don't own the asset at the end.

Buying is better for long-term use (5+ years) due to equity building/resale value.

For businesses, lease payments are 100% tax-deductible as expenses.

Depreciation benefits: Owners can claim depreciation to reduce taxable income.

Mileage limits and "wear and tear" fees are hidden costs in car leasing.

Pro Tip

If you change cars every 2-3 years, leasing might be cheaper. If you keep them for 7-10 years, buying is ALWAYS better.

Lease vs Buy Calculator - Complete Guide

Everything you need to know about Lease vs Buy Calculator and how to optimize your financial strategy.

Understanding the Formula

The core calculation is based on:

Compare NPV of Lease Payments vs Net Cost of Ownership

Key Concepts & Rules

Leasing has lower monthly payments but you don't own the asset at the end.

Buying is better for long-term use (5+ years) due to equity building/resale value.

For businesses, lease payments are 100% tax-deductible as expenses.

Depreciation benefits: Owners can claim depreciation to reduce taxable income.

Mileage limits and "wear and tear" fees are hidden costs in car leasing.

Expert Strategy

If you change cars every 2-3 years, leasing might be cheaper. If you keep them for 7-10 years, buying is ALWAYS better.

How to use this Calculator?

1. Enter your specific values in the input fields above.
2. The calculator will render instant results as you type.
3. Check the breakdown table for year-by-year projections.
4. Adjust the inputs to see how different scenarios impact the final result.