Should I buy or lease a car? The real cost comparison
TL;DR: Leasing usually has a lower monthly payment but you own nothing at the end and restart the cycle; buying costs more upfront but builds toward outright ownership and a resale value you keep. Buying is usually cheaper over a long holding period; leasing can make sense if you value driving a newer car every few years and drive within typical mileage limits.
What leasing actually is
A lease is essentially renting the car's depreciation over the lease term — you pay for the value it loses while you have it, plus interest, then hand it back (or buy it out at a pre-set price).
What buying actually is
Buying means you eventually own an asset with real resale value, but you also bear 100% of the depreciation risk, maintenance costs beyond any warranty, and the full purchase price (via loan or cash).
The number that actually decides it
Compare total cost over your realistic ownership horizon — not just the monthly payment. Our True Cost of Ownership calculator totals the full picture (financing, insurance, maintenance, fuel, and resale value) so you can see what buying actually costs over time, and weigh it against a lease quote on the same basis.
Frequently asked questions
Does leasing ever make financial sense?
It can, if you strongly value driving a new car every 2-3 years, stay within the mileage limits, and don't want to deal with resale — you're paying for that convenience, which is a legitimate trade-off, not a mistake.
What's the biggest hidden cost of leasing?
Mileage overage and wear-and-tear charges at lease-end — these can add up significantly if your actual driving or car care doesn't match the lease's assumptions.