Should You Lease or Buy a Car?
Buying or leasing a vehicle, each have their pros and cons..
When it comes time to purchase a new vehicle, there are two primary paths to take: purchase or lease. Many individuals believe that leasing a car is a more practical decision, while others prefer to own that which they use. Let’s take a look at a few of the differences between these two options. Oh, and don't forget to track you gas mileage along the way!
If you’re a car enthusiast, this is a no-brainer. Owning a car means you can modify the car, do all your own repairs and heck, you can paint the whole thing bright pink and add a massive air scoop if you want. Owning a car could also mean eventually owning a classic, or at the very least having a car to hand down to your kids. But let’s get down to the nitty gritty:
- You can to do all your own maintenance and customization.
- You have no contractual penalties for wrecking, aside from not having a car.
- You get to keep the car forever.
Buying a car is a decision of long-term ownership, very similar to buying a home. When you buy a car, you get all creative rights to that vehicle (just be sure not to void your warranty). If you buy used on the other hand, you can absolutely make whatever modifications you want.
- Your car immediately and continually depreciates in value.
- If you buy used, the vehicle often comes with no warranty.
- Your repairs could eventually cost more than the vehicle was originally purchased for.
The moment you drive a car off the lot, it depreciates in value. Moreso if you buy a used car, you’ll typically have no warranty and will have to rely on the previous owner to have good service records. In some situations, the amount of money you put into repairing the vehicle could be more than the amount you bought the vehicle for in the first place.
If you’re not a car enthusiast and just need something to get you to/from work, leasing could be the right solution. When you lease, you pay a monthly rate to use the car (plus insurance) and all the maintenance comes included by the dealership. You don’t have to worry about depreciation, but there might be some penalties if you get in a wreck.
- You can trade your car in and get another one (check out Fair.com).
- Your maintenance check ups are provided by the dealership.
- You can always drive the newest, greatest car.
If you want a reliable, fresh mode of transportation, leasing is the way to go. You can pick the car of your dreams and, at the end of your lease, pick the next one. Most leasing contracts include maintenance check ups every few thousand miles as well. Great to let someone else do all the work!
- You typically will have a mileage cap per month.
- You have little to no options for customization.
- You are bound to contractual agreements, which include monthly payments.
Leasing a car has restrictions. In most cases, this involves a mileage cap- where you are unable to drive the car for more than X miles per month. Doing so could result in fees. Also since the car is never yours, you have no option to customize or self-maintenance the vehicle. The monthly payments are going towards something you will never actually own yourself, which is the opposite when purchasing a car.
Buying or leasing a car depends greatly on how much long term ownership you wish to have over the vehicle. If you want a car that you will drive for the rest of your life, that you can customize and modify at your own discretion, then buying a car is the right option for you. If you prefer to drive the latest car and have no inclination to modify your car, then leasing may be the way to go.
Before making a decision, be sure to do your due diligence and read the fine print!
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