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Lease vs Buy Car Calculator

Find out whether leasing or buying a car saves more money over time.

Updated July 2026 · Editorial standards

Buying is cheaper over 5 years — you save
$4,770
Buy net cost (5 yr)
$27,325
Lease total cost (5 yr)
$32,095
Buy monthly payment$587Car value at end$14,907Buy down-payment opportunity cost$2,013

Based on your assumptions above — residual value, investment return, and the years you analyze swing this verdict more than any other inputs. The horizon ends mid-lease: the model charges the full drive-off amount for the final lease but assumes you exit at the horizon with no early-termination fee.

Vehicle & Loan

$
$
%
$
yrs

Key figures

Buying saves
$4,770
Buy net cost
$27,325
Lease total cost
$32,095
Buy monthly payment
$587
Car value at end
$14,907

Over 5 years: buying's all-in cost is $27,325 (after $14,907 resale value, including the invested-down-payment opportunity cost); leasing totals $32,095 with a new down payment each lease term. Buying saves $4,770.Buying builds equity and is usually cheaper long-term. Leasing offers lower monthly payments and the latest model every few years. Both sides count the opportunity cost of money paid up front. Factor in mileage limits and wear-and-tear fees when leasing.

Buying saves
$4,770
By KalkWiseVerified against official sources Updated July 2026

What is the lease vs buy car calculator — which is cheaper??

In short

Buying a car is usually cheaper long-term: over 5 years on a $35,000 vehicle ($5,000 down, 6.5% loan) buying's all-in cost is about $27,300 after resale value, versus roughly $32,100 for back-to-back $450/month leases — buying saves about $4,800. Leasing narrows the gap only with high lease-end residuals or unusually strong investment returns on the cash you keep.

Compares the true 5–10 year net cost of buying a car (loan payments plus the opportunity cost of your down payment, minus resale value) vs. leasing (all lease payments, a new down payment each lease term, and the opportunity cost of those down payments).

How to use this calculator

  1. 1Enter vehicle price, down payment, loan rate, and loan term.
  2. 2Enter monthly lease payment, lease term, and lease down payment.
  3. 3Enter residual value % (shown on your lease quote).
  4. 4Set years to analyze and expected investment return on saved cash.

The formula

buyNet=totalPaid−residualValue
leaseNet=totalLeased+opportunityCost
Buy Net = TotalPaid + oppCost(down) − ResaleValue; Lease Net = LeasePayments + Downs×cycles + oppCost(downs); Compare Buy Net vs Lease Net
buyNet
— Total paid buying + down-payment opportunity cost − resale value
leaseNet
— All lease payments + a down payment per lease term + their opportunity cost
oppCost
— What money paid up front would have earned if invested

Worked example

The scenario

$35,000 car, $5,000 down, 6.5% loan / 60 months, vs $450/mo lease / 36 months, 55% residual, 7% investment return, 5-year horizon.

gives

The result

Buy net cost ≈ $23,400 (after $12,500 resale). Lease total ≈ $29,000. Buying saves ~$5,600 over 5 years.

Common use cases

  • Decide between leasing your next car vs. financing it.
  • Compare the true cost of a lease deal vs. a purchase offer.
  • Factor in opportunity cost of the down payment.
  • Model how long you need to keep a car for buying to beat leasing.

Limitations & assumptions

  • Does not include insurance, maintenance, registration, or mileage overage fees.
  • Residual value and depreciation assumptions are estimates — actual resale varies by make/model.
  • Lease terms vary; some include free maintenance (raises lease value).
  • Tax treatment of lease vs. buy differs for self-employed and business use.

Frequently asked questions

Usually yes over 5+ years, because you build equity and pay off the loan. Leasing can win if you value always driving a new car, keep mileage low, or if the down payment would earn more invested than the equity you'd build in the car.

Disclaimer: KalkWise calculators are provided for general informational and educational purposes only and do not constitute financial, investment, tax, or legal advice. Results are estimates based on the figures you enter and the assumptions described above. Actual outcomes will vary. Consult a qualified professional before making financial decisions.