Equipment Buy vs Lease Calculator
Compare buying vs leasing your next truck, skid steer, lift, or excavator. Plug in real numbers to see total cost over time, monthly cash impact, and which option actually wins for your situation.
Truck, skid steer, lift, etc.
How long until you'd replace it
Same for buy or lease
Tires, oil, brakes, repairs
Buying Terms
60 = 5 years, 72 = 6 years
Equipment loans typically 7–12%
Trucks hold ~40–60% after 5 yrs. Skid steers/excavators hold 35–55%. Lifts/scissor lifts 30–50%.
Leasing Terms
Plus first payment, taxes, fees
36 or 48 is typical
Work Truck: 5-Year Comparison
Over 5 years, BUYING wins by:
$8,893
About $1,779/year — before tax effects
Buying
Leasing
Year 1 Cash Flow Impact
How much cash leaves your business in the first 12 months — the difference often matters more than total cost when you're growing.
Buy: Year 1 Cash
$23,471
Lease: Year 1 Cash
$15,400
Leasing ties up $8,071 less cash in year one.
Quick Decision Guide
- Lean toward buying if: you keep equipment 6+ years, you have cash for the down, and the equipment isn't critical-path (you can run it past warranty).
- Lean toward leasing if: cash flow is tight, you need newest equipment for image (sales trucks, lifts on commercial sites), or you want bundled maintenance.
- Tax wildcard: Section 179 lets you expense up to $1.16M of equipment in year one (2025). If you have a high-profit year, buying + 179 can beat leasing on after-tax basis. Run this past your CPA before signing.
How to Use This Calculator
Enter the equipment cost and your loan terms on the left, and the lease payment and term on the right. Set the years you plan to use the equipment — this is the most important input. Buying wins on long horizons (5–7+ years) when you'll own it past the loan; leasing wins on shorter horizons or when cash flow is tight. The result shows total net cost, effective monthly cost, and year-1 cash impact for both paths.
Formula Used
Buy Net Cost = Down + (Monthly Payment × Months Paid) + (Insurance + Maintenance × Years) − Resale. Lease Net Cost = (Down × Lease Cycles) + (Monthly × Months) + Insurance + Maintenance.
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Disclaimer
This calculator is for estimation purposes only. Results may vary based on local conditions, materials, and building codes. Always consult a licensed professional before making decisions based on these calculations. MyContractorTools is not responsible for any errors or omissions.