Leasing spreads the cost; buying builds equity. Compare the total for each.
This calculator compares the cost of leasing business equipment against buying it, accounting for financing and resale value.
Leasing spreads cost into monthly payments with nothing owned at the end, while buying involves a purchase price you may finance and an asset you can resell later. The tool tallies total lease payments over the term and compares them with the net cost of buying, which is the purchase price adjusted for financing or opportunity cost minus the resale value you expect to recover. Bringing both onto the same time frame makes the comparison fair.
The financing or opportunity rate accounts for the cost of tying up or borrowing money to buy, which is why a lower rate tends to favor buying. The model does not capture tax treatment such as depreciation or Section 179, maintenance responsibilities, or the flexibility to upgrade that leasing can provide. Resale value is an estimate that can miss, especially for equipment that ages quickly. Use this as a cost comparison, not tax or financial advice.
Buying leaves you with an asset you can sell later, so subtracting its expected resale value reflects the true net cost of ownership.
It is the cost of the money used to buy, whether interest on a loan or the return you give up by spending cash, and it makes the comparison fair.
No, depreciation, Section 179, and lease deductions can change the outcome and are not modeled here, so consult a tax professional.
See the exact formula and a worked example on our methodology page.