Will your next car be leased? Or are you looking to buy a car? The question of whether to lease or buy when financing your next car is less about financial means, and more about driver preferences, priorities, and habits. We have plenty of good things to say about both options, so you can’t really go wrong!
Your choice might be different from one different stage of life to another– for example, a daily commuter would probably be better off buying, considering the typical 12,000 per year mileage limit on leased cars. What’s the basic difference between the two options? With a leased vehicle, you pay only for the depreciation of the car during the years leased, versus paying for the entire cost when buying.
- Business or personal? Leasing a car can be optimal for someone looking for a business car– when you lease, you can usually get a luxury vehicle you might not when buying. In addition, a portion of a leased vehicles depreciation and costs can be included as tax deductions up to a certain amount.
- More for your money (short-term). Itching to have the newest of the new in auto technology? Leasing allows you to pay less for more.
- Cash flow. Though over the long-term buying is more economic, leasing is less costly than the initial costly down payment and following monthly payments when buying. If you’re unable to save to own based on your current salary, leasing might be a good short term solution.
- Avoid upside-down loans. This is when you owe more than your car is actually worth.
- Drive wherever, however and how long you want. The car is 100% yours, so if you want to make 3 road trips across the country a year, you can. You can modify the car as you’d like, and don’t have to fear outrageously high costs at the end of a lease for any damages incurred.
- Overall, more economical. The longer you own it, the more you save.
- Stick with one. If you’re someone who is happy to have one car for years, and can handle any upkeep costs, your loyalty will pay off.
- Insurance and warranty. If you lease, expensive repairs should be covered by the factory warranty. But if you’ve bought, you’ll need to insure the vehicle. That’s where BMR Insurance comes in.
Have experience with leasing versus buying? Share your testimony with us in the comment section below. Questions about insuring your vehicle– whether bought or leased? Call BMR Insurance at 714-838-1911 for a free quote.