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Buy new, used, or lease? Five questions to decide

Answer five quick questions about how you drive and what you can spend. Each answer tells you what it means for buying or leasing. Then check the real numbers before you sign.

Last reviewed: October 1, 2026. How we review this guidance. Rules and fees can vary by state, lender, dealer, and vehicle.

  1. 1. How many miles do you drive in a year?

    Not sure? Compare the mileage on two service receipts from a year apart.

  2. 2. How long will you keep the car?

    Think about a move, a growing family, or a longer commute coming up.

  3. 3. How much cash can you put in up front?

    Count only money you won't need for emergencies.

  4. 4. If the car needed a big repair next month, could you pay for it?

    Think of a repair bill on top of your car payment.

  5. 5. Do you want to own the car outright someday?

    Owning means no car payment once the loan is paid off.

What your answers point to

Answer all 5 questions to see what they point to. You've answered 0.

These are rules of thumb, not a verdict on a deal. Written quotes for the exact car decide which costs less.

Comparing two specific cars? (optional)

Keep notes on two cars, loans, or leases side by side. Your notes save in this browser only.

Open the side-⁠by-⁠side worksheet

Notes stay in this browser profile, where other people using it may see them. No account or upload. Keep identity and bank details out of this worksheet. Storage details

Opening local worksheet…

Vehicle decision worksheet

1. Set your constraints

Start with your life and your budget. You can come back to these notes as written offers arrive.

How much can you pay up front and each month while keeping money for other bills and surprises?

Passengers, cargo, accessibility, commute, parking, climate, or towing.

Use recent driving plus expected changes. Check a lease's allowance.

For example, the next 36 months. Use the same length of time for both choices.

How much unexpected repair cost or time without the car could you handle?

2. Put two options beside each other

Name each option in the first row⁠—for example, “Blue used sedan” and “New hatchback lease.” For every later row, keep written figures, estimates, and unanswered questions distinct. Use the same length of time for both; this worksheet does not add unlike costs together.

Vehicle / option

Use an exact vehicle or a clearly described option.

Fit for your must-⁠haves

What works? What is missing? Include a test drive or accessibility check.

Price and money due up front

Copy the written out-the-door purchase price or lease amount due at signing. List your cash down and trade/payoff separately.

Loan or lease payment terms

For a loan: annual percentage rate (APR), amount financed, length, and payments. For a lease: disclosed payments, mileage allowance, and return terms. Note conditions on any credits.

Costs while you use it

Insurance quote for this exact car, fuel or charging, maintenance, repairs, registration, and parking over the same time period.

What happens at the end

For a purchase: estimated vehicle value and remaining loan balance. For a lease: return costs, possible mileage/wear charges, and your next transportation.

What is still an estimate or unknown

Mark the source and date of each estimate. List costs or conditions that need a written answer.

Next fact to get

Name one question, inspection, written quote, or cost estimate to get before deciding.

3. Test your choice

If mileage, repairs, insurance, or end value changes, does your choice change too? Resolve the uncertain facts that matter most before committing.

This is your private comparison, not a message to a seller. Copy, print, or download it for your own records; nothing is sent from this page.

Check and keep written purchase quotesCompare lease and purchase cost estimatesChoose your buying plan
How to compare costs fairly

1. Write down what you need

Budget

Cash you can put in, the most you'll pay in total, your emergency fund, and any loan left on your trade-in.

Daily use

Commute, passengers, cargo, weather, parking, accessibility, towing, and anything else the car must do.

Mileage

How many miles you drive a year now, plus any changes you expect.

How long you'll keep it

The number of months or years you plan to keep or use the car.

Repair risk

How well you can handle surprise repair bills, time without a car, and upkeep.

Insurance

A quote for each exact car, including any coverage the lender or leasing company requires.

2. Compare costs over the same time period

Pick one time period and use it for both options. The simplest choice is the lease term: use the lease's total of payments, then add up what buying would cost over those same months. If you pick a different period, count the lease's early-termination cost if you would end it early, or the cost of your next car if the lease ends first. Write down every assumption.

  • The deal: itemized out-the-door price, cash you pay, trade-in credit, and any add-ons.
  • Loan: APR, amount financed, loan length, finance charge, payments you make in that period, and what you would still owe at the end.
  • Lease: for a full-term comparison, start with the total of payments and payment schedule on the federal lease disclosure (Regulation M). Read the federal disclosure rule. Don't add fees already in that total, such as a listed disposition fee (the fee to turn the car in). Add separately only costs left out of the total or that depend on what happens later: extra miles, extra wear, ending early, or buying the car at the end. Use the same assumptions for both options. A refundable security deposit isn't a cost, but note when you pay it and get it back.
  • Running costs: insurance, registration, taxes, fuel or charging, parking, maintenance, and wear items like tires and brakes.
  • At the end: what the car will likely be worth and what you would still owe, or your lease turn-in and buyout assumptions.

3. Test your choice

Change one guess at a time: miles per year, how long you keep it, repair costs, insurance, or end value. If a small change flips the winner, get better numbers before you commit. And if the cheaper option misses a must-have need, it isn't the better deal.

Sources

These sources explain general rules. Check current requirements in your state and the terms in your own paperwork.

Buying new

Buying used

Leasing

Bad credit or negative equity

Private seller

Calculators and tools

Dealer tactics

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Car-deal rules and fees depend on your state. Check your state motor-vehicle or consumer-protection agency and your written agreement.