The decision is about days, not about price
A $3,200 laptop looks expensive compared with $89 a day, and it is, until you notice that a rented day is not a day you use. The comparison only works once both sides are converted to the same unit: your actual days of use per year. Rent costs scale with usage; ownership is mostly fixed. That asymmetry produces a break-even number of days, and it is the only number you really need. Above it, owning wins. Below it, renting wins, and the gap grows every year you keep renting.
The second thing most comparisons get wrong is the cost of owning. The purchase price is only one term. Over the years you keep the item you also pay for accessories, maintenance and repairs, insurance, and the interest if you finance it. Against that, you recover resale value. Netting those gives the true cost of owning, and it is usually far lower than the sticker price for a well-used asset and far higher for something that depreciates to nothing.
Financing deserves a separate word. A financed purchase spreads cash out but adds interest, and interest is a real cost of the asset even though it is separate from the asset's value. Comparing a dealer "cash price" to a monthly payment without APR and term is the most common mistake in this decision. The rate and the term are what determine the total, so they belong in the model. This calculator shows the total interest and the monthly payment side by side so the cash-flow argument is visible separately from the cost argument.
How to use it, step by step
- Use the real cash price, not the financing price. Many shops advertise a low monthly payment and a higher cash price. If you are paying cash, the cash price is what the item costs you; if you are financing, keep the APR and term as they are and let the model add the interest.
- Estimate resale value honestly, and update it yearly. Look at what the same model sells for used right now, not what you paid. A model that is refreshed every two years loses far more value than one that is not, and the resale figure is often the difference between owning and renting.
- Count days of use, not days you could use it. If you are a photographer, a camera you shoot on four paid jobs a month is used about 48 days a year. A laptop you open every working day is used about 220. The second number changes the answer completely.
- Add the accessories and the insurance to the owning side. Batteries, memory cards, a camera body that needs a second body for weddings, the rider on your policy that covers the gear: all of them belong in the comparison, and they are often the reason a "cheap" rental turns out to be the complete answer.
- Include the rental extras before comparing. The daily rate is rarely the whole price. Damage waivers, deposits, delivery and collection, insurance and fuel or transport add up, and the waiver line is frequently larger than the difference between the two options.
Where people get the comparison wrong
- Ignoring resale value. A car you will keep for five years and sell for half is much cheaper than the sticker price suggests. The same is true for cameras, lenses and laptops.
- Paying annual subscriptions for a tool used two months a year. A design or editing suite at $600 a year that you open for one project is a worse deal than a one-off licence or a rental, and the comparison is only fair if the usage matches.
- Renting for one shoot and then buying the same item anyway. If you end up owning it, the rental was an expensive trial. Sometimes paying a rental fee to avoid a bad purchase is worth it, but do it consciously.
- Comparing an APR monthly payment to a cash price. A $60 monthly payment is not a $60 item. Look at the total you will pay over the term.
- Treating depreciation as cash cost. Depreciation and Section 179 reduce your taxable profit; they do not put cash back in your account. Never let a tax deduction decide a purchase you cannot afford.
What this tool does not do
The numbers here are illustrative arithmetic, not tax advice, not an appraisal and not a recommendation from any lender, manufacturer or rental house. It does not price lease contracts: a real lease has a residual or buyout option, an acquisition fee, a security deposit, insurance requirements, maintenance obligations and its own tax treatment, and the lease line in this tool is a simplified monthly payment rather than a quote. It does not value used equipment, and your resale estimate is only as good as the market data behind it. It does not model rental damage claims, late return fees, shipping or travel, or the cost of your own time to pick up and return equipment. Tax treatment depends on how the item is used, whether it is used more than 50% for business, your state, and your overall income; the rules change, so confirm the current figures before you act on them.
Related tools for independent work
Gear is usually a line in a project budget, and the client project costing tool is where you decide how much of that cost to pass on to a client rather than absorb. The quarterly tax estimator shows the tax reserve that a new equipment purchase will eat into, which matters when the purchase is financed rather than paid outright.
FAQ
How many days of use do I need to justify buying?
The tool calculates it for your numbers: it is your annualized cost of owning divided by your effective daily rental cost. A typical professional kit breaks even somewhere between 8 and 20 days a year. If you use the item less often than that, renting is cheaper. If you use it weekly or more, buying almost always wins, because rental companies price for idle fleet time and you do not.
Does the tax depreciation change the answer?
It can change the ranking, and it should not change the cash question. Section 179 or bonus depreciation may let you expense a large part of the purchase in year one, which is worth real money at your marginal rate: expensing $3,200 at a 25% marginal rate is roughly $800 of tax saved. But the money left the account when you paid. If the purchase would strain your cash flow, the deduction does not fix that, and financing at a high APR to capture a deduction is a poor trade.
Is leasing ever better than either?
Sometimes, for two reasons. First, cash flow: if a large down payment would hurt, a lease with a lower monthly outlay keeps more of your working capital liquid. Second, risk: if you need the newest hardware every two years and cannot predict the resale market, a lease with a fixed buyout removes the residual-value risk. The cost of that protection is the total outlay over the term, which is usually higher than buying and keeping the item longer. This tool does not model real lease contracts.
Should software be compared the same way?
Yes in structure, with one difference: a perpetual licence is a one-off purchase with no resale value and no maintenance, so the owning side of the comparison is simply the licence price divided by the years you expect to use it. A subscription is a rental that renews forever. The decision then comes down to whether you will use the tool enough each year to justify the subscription, and whether the tool you are paying for every month is the one you actually open.
How do I handle a piece of gear I use for both work and personal life?
Split it. Use the rental comparison for the business share of the days and the depreciation or expense claim for the business share of the cost. For depreciation, the business-use test is generally that the equipment is used more than 50% of the time for business, and there are recordkeeping and listed-property rules for vehicles that do not apply to cameras and laptops. If the split is hard to track, keep a simple log of which days the item was used for which purpose; that is usually enough to defend the allocation.
Should I buy the item outright or finance it?
Financing only makes sense when the cash is needed elsewhere or when the item produces revenue immediately. The model above shows the total interest, which is the cost of buying earlier than you otherwise would. For most freelancers buying equipment, the pattern that works is: pay cash for the things that are essential to deliver work, and reserve a small monthly amount in a separate account so future purchases are funded without a loan.
Methodology and data sources
Monthly payment = P × r ÷ (1 − (1+r)^−n) where P is the financed amount, r is APR ÷ 12 and n is the term in months; total interest = payment × n − P. Total cost of owning over the holding period = purchase price + accessories + (maintenance + insurance) × years + total interest − resale value; annualized cost divides that by the years. Total rental cost = the cheaper of (daily rate × days) and (weekly rate × weeks rounded up), plus the damage waiver per day, with the deposit treated as a refundable cash requirement rather than a cost. Break-even days = annualized cost of owning ÷ (daily rate + waiver per day). Tax reference: Section 179 expensing limit $2,560,000 for 2025 with phase-out beginning above $3,130,000 of total 2025 investment; bonus depreciation at 100% for qualifying property acquired after January 19, 2025, then 80% in 2026, 60% in 2027, 40% in 2028, 20% in 2029 and 0% for property acquired after December 31, 2029 (One Big Beautiful Bill Act); MACRS class life of 5 years under the 200% declining balance method for computers, cameras and most audio and video production equipment, and 7 years for many other items. These figures are published for the 2025 tax year and change annually.