Should You Lease or Buy Your Next Car?
Compare the total cost of leasing vs buying a vehicle over 3-6 years. See which option costs less for your situation.
Lease vs Buy: The Real Math
Leasing is essentially renting a car — you pay for the depreciation during your lease term plus interest (money factor) and fees. Buying means you pay the full price but build equity and can sell the car later. Over 3 years, leasing is often cheaper because you avoid the steepest depreciation. Over 5+ years, buying is almost always cheaper because you own an asset worth $10,000-20,000 after your loan is paid off.
When Leasing Makes Sense
Leasing makes financial sense if you: always want a new car every 2-3 years (serial new-car buyer), drive under 12,000 miles/year, want lower monthly payments, or need a vehicle for business (lease payments are fully deductible for business use). Leasing does NOT make sense if you: keep cars 5+ years, drive over 15,000 miles/year, or want to build equity.
The cheapest way to own a car: buy a 3-year-old certified pre-owned vehicle, finance for 48 months or less, and keep it for 7-10 years. Total cost of ownership is roughly 40-50% less than leasing a new car every 3 years and 30% less than buying new every 5 years.
