According to the Canadian Car Dealers Association about 60% of buyers lease their vehicles leaving the other 40% of buyers either financing or paying cash.  This is a very large ticket item for Canadians to purchase so here we are providing a comparison of leasing vs financing – what is better?

In this scenario we are not putting any money down and although we could choose a longer financing term – we kept it the same as the lease so we could compare the numbers properly.  The finance payment is very high when compared to the lease payment, however at the end of the 4 years – you own the car!  If you plan to keep the vehicle for 10-12 years – the cost of ownership works out to less than $6,000 per year.  Check out how much you would pay to keep leasing (or should I say renting) a car for the next 12 years, (a whopping $143,679).

Of course, we would always suggest purchasing/financing over leasing to ensure that you reduce the fees and interest on this depreciating asset.  It may also be a good idea to get an extended warranty to help with future repairs and maintenance.   Coming Up:  Look for Part 2 – an analysis of a lower car purchase under $35,000 comparing a lease/finance for 4 years.

$55,000 Car Purchase/Lease

LEASING:  (like renting-you do not own the vehicle)
*   Mileage package effects your lease payment: 12 KM, 16 KM or 20 KM per year.  We chose 16 KM/year.

$65,400  Lease Amount, ($55,000 Vehicle + $2,095 Freight/PDI + Taxes and Licensing)

$997.79 per month, Four year lease at 4.98%

$47,893             TOTAL PAID OVER FOUR YRS, Options: Turn in Vehicle and pay closing fees, (approx.$1,500) or Buy-out Lease

*If you plan to do this again with another lease, the cost of leasing over 12 years = $143,679 or $11,974/year.

*If you wanted to purchase the vehicle at the end of the lease, you would pay more than the finance option.

$78,403             TOTAL COST WITH BUYOUT AT END OF LEASE, ($30,510)



$65,400 Finance Amount, ($55,000 + 2,095 Freight/PDI + Taxes and Licensing)

$1,478 per month, 4 year at 3.98%


*If you plan to keep this vehicle for 10-12 years, the cost per year drops to $5,912/year to own your car.