Lease vs Buy Calculator

Use our free lease vs buy calculator to compare the total cost of leasing versus buying an asset such as a car or equipment. Includes loan financing, lease payments, residual value, and investment return analysis.

Financial

Currency

Purchase Price

Down Payment (for buying)

Loan Interest Rate (%)

Loan Term (years)

years

Monthly Lease Payment

Lease Term (years)

years

Residual / Asset Value After Lease

Investment Return Rate (%)

Formula

Deciding whether to lease or buy depends on the total cost of each option. This calculator compares the total cost of buying with a loan versus leasing, including the residual asset value and potential investment returns from the savings difference.

Buy Total = P[r(1+r)^n] / [(1+r)^n - 1] x n + D, Lease Total = L x term x 12

Percentage: The percentage value you want to apply

Number: The original number or value

Result: The calculated result

How It Works

1Enter the purchase price, down payment, loan rate, and loan term for buying.
2Enter the monthly lease payment and lease term.
3Enter the residual value of the asset after the lease period.
4Optionally enter an investment return rate on any monthly savings.

Examples

$40k car: Buy at 6% for 5yr vs Lease at $450/mo for 3yr

1.Buy: finance $35k at 6% for 5yr = $676.65/mo, total = $40,599 + $5k = $45,599
2.Lease: $450 x 36 = $16,200, asset worth $20k after
3.Lease total cost = $16,200 (lease payments)

Result: $29,399

Frequently Asked Questions

Leasing is better if you want lower monthly payments, drive new cars every few years, and don't exceed mileage limits.

Buying is better if you keep vehicles long-term, drive many miles, or want to build equity in the asset.

The estimated value of the asset at the end of the lease term. A higher residual value means lower lease payments.

Related Calculators

Car Lease Calculator Equipment Loan Calculator Auto Loan Calculator Tip Calculator Discount Calculator Loan Calculator

Lease vs Buy Guide

CalculateMe Team

Last updated: 2026-07-15

Frequently Asked Questions

Leasing is better if you want lower monthly payments, drive new cars every few years, and don't exceed mileage limits.

Buying is better if you keep vehicles long-term, drive many miles, or want to build equity in the asset.

The estimated value of the asset at the end of the lease term. A higher residual value means lower lease payments.

Lease vs Buy Calculator

Formula

How It Works

Examples

$40k car: Buy at 6% for 5yr vs Lease at $450/mo for 3yr

Frequently Asked Questions

When is leasing better than buying?

When is buying better than leasing?

What is residual value?

Related Calculators

Related Articles

Lease vs Buy Calculator

Formula

How It Works

Examples

$40k car: Buy at 6% for 5yr vs Lease at $450/mo for 3yr

Frequently Asked Questions

When is leasing better than buying?

When is buying better than leasing?

What is residual value?

Related Calculators

Related Articles