Lease vs. buy a car.
In plain English
When you lease a car, you pay for the depreciation and financing over the lease term, usually two or three years, then return it and have nothing to show for the payments. When you buy, whether cash or with a loan, you pay for the entire vehicle and own it at the end, including whatever resale value it still has. Lease payments are usually lower than loan payments on the same car because you are only paying for part of it, but they never stop if you keep leasing new cars. Buying costs more per month but ends, and the years after the loan is paid off are the cheapest miles you will drive.
01Why it matters
Over a decade the two paths can differ by thousands of dollars, and people typically weigh a lower monthly payment and a new car every few years against owning a paid-off car outright, so laying out both totals is what the comparison is for.
02The math, step by step
Lease a 30,000 dollar car and you might pay a few hundred dollars a month, then return it after three years and start again. Buy the same car with a five-year loan and the payment is higher, but in years six through ten you pay nothing but upkeep. A driver who leases continuously always has a payment; a buyer who keeps the car has stretches with none.
Illustrative example. The amounts here are hypothetical, chosen to show how the math works, not real quoted rates or figures.
03What this is NOT
This is not a recommendation for your situation. Leasing is not throwing money away and buying is not always cheaper. The math turns on how long you keep a car, how many miles you drive, and whether a lower payment or eventual ownership matters more to you.
04Receipts
Every figure on this page is sourced to a primary document. Tap to open the original.