Car Buy vs. Lease / Cab Calculator
Compare the total 5-7 year cost of purchasing a car (loan EMIs, insurance, fuel, and depreciation) against leasing a vehicle or using daily cabs.
Cab / Leasing is cheaper!
Saves you approximately ₹90,558 over 5 years.
Cumulative Outflow Over Time
Frequently Asked Questions
Should I buy a car or lease/cab if I drive less than 10,000 km per year?
If your yearly driving is under 10,000 km, using ride-hailing services or renting is typically much cheaper than car ownership. A new car loses 10-15% of its value the moment it leaves the showroom and around 50% in 5 years. Add fixed costs like yearly comprehensive insurance, servicing, parking, and cleaning, and the cost per kilometer for low-mileage owners becomes extremely high.
How does opportunity cost affect the car buy vs cab comparison?
The biggest hidden expense of buying a car is opportunity cost. If you pay a down payment of ₹3 Lakhs and buy a car, that money is locked in a depreciating asset. If you use cabs and invest that ₹3 Lakhs in equity mutual funds at a 12% annual return, it grows to approximately ₹5.28 Lakhs in 5 years. This capital growth offsets the cost of taxi services, making leasing or renting a compelling financial alternative.
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The Car Trap: Why Your Vehicle Is Destroying More Wealth Than You Realize
Cars are the largest financial mistake most middle-class Indian families make — not because cars are bad, but because the purchase decision is made on emotion, social pressure, and monthly EMI affordability instead of total cost of ownership.
A ₹15 lakh car purchased with a 7-year auto loan at 9% costs ₹23.7 lakh in total (principal + interest). Add insurance (₹60,000–80,000/year), maintenance (₹40,000–60,000/year), fuel, and parking. Over 7 years: ₹35–40 lakh all-in for a vehicle that's worth ₹4–5 lakhs at resale.
Now consider the alternative: spending ₹5 lakh/year on cab rides (Uber, Ola, rental cars for outstation) and investing the down payment + EMI difference in equity SIPs. Over 7 years, the investment corpus could reach ₹18–22 lakhs — money that continues compounding, not depreciating.
This doesn't mean you shouldn't own a car. It means you should make the decision with full financial awareness. Cars are a lifestyle choice with a financial cost — not an investment. If you must buy, buy reliable, used (not brand-new depreciating from Day 1), and with the smallest loan possible. If city cabs plus occasional rental covers your needs, the numbers strongly favour not owning.
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