Calculator
EV Lease vs Buy Calculator
Compare leasing vs buying any EV — monthly payments, total cost over your planned ownership period, and the break-even crossover point where buying starts to save money.
Vehicle
Lease
Buy / Finance
LEASE — monthly payment
$0
Total lease cost: $0
BUY — monthly payment
$0
Cost over 60 months: $0
How lease vs buy is calculated
Lease monthly payment has two parts: depreciation (price minus residual, spread across the lease term) plus a finance charge based on the money factor (APR / 2400) applied to the average of the cap cost and residual:
monthly depreciation = (price − down − residual) / lease months
monthly finance = (price + residual − down) × (APR / 2400)
lease payment = depreciation + finance
Buy monthly payment uses the standard amortization formula. The "cost over ownership period" subtracts your estimated resale value at the end:
buy payment = P × r × (1 + r)^n / ((1 + r)^n − 1)
where P is principal (price − down), r is monthly rate (APR/12/100), and n is loan months. The total cost over your ownership period accounts for additional months after the loan is paid off (where you own the car free and clear).
Frequently asked questions
Is it better to lease or buy an EV?
For most buyers, leasing an EV is more cost-effective in the short term (under 4 years) because the federal $7,500 tax credit is applied through the lease and EVs depreciate faster than ICE vehicles. Buying wins long-term (5+ years of ownership) because lease payments continue indefinitely while loan payments end. The calculator below shows the break-even point for your specific scenario.
Why is EV depreciation so high?
EVs depreciate 30–50% in the first 3 years versus 20–30% for comparable ICE vehicles. Reasons: rapidly improving battery technology making older EVs less competitive, manufacturer price cuts (Tesla cut prices 20% in 2023–2024), and uncertainty about battery longevity. Tesla Model 3 and Model Y hold value best; Hyundai/Kia EVs and Chevy Bolt depreciate fastest.
How does the $7,500 tax credit work in a lease?
In a lease, the leasing bank (not you) gets the $7,500 commercial clean vehicle credit. Most manufacturers pass this through as a "lease cash" incentive that reduces the capitalized cost — effectively giving you the credit upfront without needing to qualify under personal income limits or vehicle MSRP/assembly requirements. This is why leasing makes EVs that don't qualify for the personal tax credit (income too high, or model not on the approved list) much more attractive.
What residual value should I use?
Manufacturer-set lease residuals run 50–62% for 36-month EV leases. Real-world resale after 36 months is often lower (35–50%) because of depreciation pressure. For lease math, use the contract residual. For buy math (your expected resale), use a real-world estimate — check Kelley Blue Book or CarGurus for comparable model + year + miles.