Buy versus lease

Ravi Nishant produces some of the best summaries for topics that are complex yet he makes it look easy.

What I know about the topic is that there could be a lot of math involved. Any time I need to decide if I was going to buy versus lease I would do the calculations. Here are a few of the questions I would resolve that you will also find in this handout.

What is the original price including all taxes. On a lease payment what would be the cost of interest. Could I get a better rate? What is the opportunity cost of the money? If the payments are low then how much would I have to pay at the end of the lease so I could own the item. How long do I plan on keeping the item? Do I have room in my capital budget? And so many more!

What I have seen are individuals that make the math complex when you buy or lease so that you make a decision in their favor. Using this guide you will never be caught off guard.