To Lease Or Not To Lease

Leasing computer equipment may be an option if you need to purchase a significant amount of computer equipment but don’t want to invest the funds and incur the costs upfront.

Leasing allows you to spread out the payments over the lease term (typically 24-36 months) and make smaller, monthly payments rather than one large lump sum payment. However, leasing also means you don’t own the equipment (but still need to properly maintain it) and you’ll be making interest payments on top of the principal. You will end up paying out more over the lease term than if you were to buy the equipment outright. This is something you should take into consideration before jumping into leasing equipment.

At the end of the lease term, some leases allow a buyout while others will continue month-to-month or renew for another term until canceled or a new lease is signed. You’ll want to carefully evaluate your business needs and the condition of the computer equipment prior to the end of the lease term so you can make an intelligent, informed decision.

Computer equipment is typically outdated after three years so you’ll want to upgrade/replace the leased equipment with new equipment; however, you’ll want to decide whether it still makes sense to lease equipment or to outright purchase new equipment which will cut the interest payments and save your business money.

Owning the equipment may also give you greater flexibility when it comes to upgrading internal components and staggering your computer equipment upgrade schedule.