Automotive
Find out the estimated total cost differences between buying a car outright and leasing it for a term.
Weigh monthly payments, final costs, and potential resale values.
A purchase vs. lease calculator compares the total financial cost of buying a car outright versus leasing one. This is one of the most important automotive financial decisions because it affects monthly budgets, long-term wealth, and vehicle flexibility.
The calculator computes total costs for both paths: for purchase, it adds monthly payments plus down payment, then subtracts estimated resale value. For lease, it sums monthly payments plus end-of-lease fees and mileage overages. It compares net costs and calculates break-even points.
Purchase Total Cost = (Monthly Payment × Term) + Down Payment − Resale Value. Lease Total Cost = (Monthly Payment × Term) + End-of-Lease Fee + Mileage Overages. Break-Even Point = Total Cost Difference ÷ Monthly Payment Difference.
Lease payments are deceptively low because you're paying for depreciation plus fees. When you add mileage overages, end-of-lease fees, and wear charges, total costs can exceed purchasing.
A larger down payment reduces the financed amount, lowering monthly payments and total interest paid. For leasing, it reduces monthly amounts but doesn't significantly impact total lease expense.
The break-even shows how many months of higher payments you need before purchasing becomes cheaper. If you plan to keep the car longer, purchasing wins.
