Lease, finance or pay cash?
The same car, the same months, the same money each month: see which way of paying leaves you with the most at the end.
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Paying cash leaves you €779 more than financing after 48 months.
Every path spends the same each month; whatever one path doesn't spend is invested at 5%. Net position = investments + car value − remaining loan. Lease comes last, €849 behind.
- Cash: net position
- €63,185
- Finance: net position
- €62,406
- Lease: net position
- €62,336
- Loan instalment
- €750
Paid €40,000
Paid €44,003
Paid €23,780
Interest €4,003
- Cash
- Finance
- Lease
What if… who comes out ahead
See the figures
| Cash | Finance | Lease | |
|---|---|---|---|
| Paid at the start | €40,000 | €8,000 | €1,100 |
| Total paid | €40,000 | €44,003 | €23,780 |
| Investments | €39,985 | €39,206 | €62,336 |
| Car value | €23,200 | €23,200 | €0 |
| Loan still owed | €0 | €0 | €0 |
| Net position | €63,185 | €62,406 | €62,336 |
Next step
How the calculator works
It follows one car through the same period three ways:
- Cash. The whole price leaves your account at the start.
- Finance. A down payment at the start, then a fixed instalment each month. Interest is charged monthly at the nominal rate ÷ 12, as German loan contracts quote it. An optional balloon is paid with the last instalment.
- Lease. A down payment (Sonderzahlung) and delivery fees at the start, the monthly rate, and at the end a charge for extra kilometres and the costs at return.
To compare fairly, every path spends the same money each month: as much as the dearest path pays that month. Whatever a path does not spend goes into an investment earning your return. That is how the cash buyer, who has nothing to pay after day one, invests the loan instalment every month, and the leaser invests most of the price from the start.
At the end:
Net position = investments + car value − loan still owed
Buyers own the car, worth the residual percentage of its price. Leasers give it back and own nothing. The path with the highest net position is the cheapest.
Example: a €40,000 car over four years
| Cash | Finance | Lease | |
|---|---|---|---|
| Paid at the start | €40,000 | €8,000 | €1,100 |
| Total paid | €40,000 | €44,003 | €23,780 |
| Investments after 48 months | €39,985 | €39,206 | €62,336 |
| Car value | €23,200 | €23,200 | €0 |
| Net position | €63,185 | €62,406 | €62,336 |
The loan of €32,000 at 5.9% costs €750 a month and €4,003 in interest. The lease costs €460 a month plus €1,100 in fees and €600 at return. The car is assumed to keep 58 % of its value after four years at 15,000 km a year; that is what our depreciation curve, calibrated to DAT’s three-year values, gives for a petrol car sold privately.
The three paths end within €849 of each other. Total paid is misleading on its own: the lease payments add up to 41% less than the cash price, but at the end the buyer still has a car worth €23,200.
What decides it
The return on your money. At 5% the cash you don’t tie up in the car earns something. At a 0 % return the order is clearer: cash €59,513, finance €55,510, lease €52,533. Then the loan’s interest and the lease’s margin are pure cost.
The car’s value at the end. Every point of residual value is €400 for a buyer and nothing for a leaser. If the car loses more value than expected, leasing looks better, because the leasing company carries that risk.
The lease offer. Manufacturers subsidise some leases, especially for electric cars. A €45,000 EV leased at €340 a month with €2,000 down, against a residual of 47 %, leaves the leaser €11,195 ahead of the next path.
Kilometres. Extra kilometres beyond the lease allowance are charged at the end, and high mileage lowers a buyer’s resale value as well.
What it can’t see
It does not tax investment gains, and it cannot know whether a dealer gives a better discount for cash or bundles one into a lease. It ignores running costs, which are the same in all three paths; the car cost comparison adds fuel, insurance, tax and servicing. And it stops when the lease ends: buyers keep driving a car they own, leasers start a new contract. How that fits with the rest of your money – a home, children, retiring – is what Zenarios plans.
Common questions
Is leasing or buying a car cheaper?
It depends on the lease rate, the car's value at the end and what your money earns. In the example a €40,000 car over 48 months leaves €63,185 with cash, €62,406 with a 5.9 % loan and €62,336 with a €460 lease: close together. Cheap lease offers, especially for electric cars, can tip it clearly towards leasing.
How does the calculator compare paths with different payments?
Every path spends the same each month: whatever the dearest path pays that month. The others invest the rest at your return. At the end it compares investments plus the car's value minus any loan still owed. Leasers own no car at the end.
Is paying cash the same as a 0 % loan?
Only if your money earns nothing. At 0 % loan interest and 0 % return, cash and finance end exactly equal; the tests check this. With a positive return a 0 % loan wins, because the cash you keep is invested while you pay off the car.
What does a balloon payment change?
A balloon (Schlussrate) lowers the monthly instalment because part of the loan is paid in one sum at the end. You pay more interest overall, since more of the loan stays outstanding for longer. Here the balloon is paid with the last instalment, from the money each path set aside.