How to Decide Whether to Lease or Buy Your Next Car
When you’re in the market for a new car, you’re faced with dozens of choices, big and small. Perhaps the biggest one is whether you choose to lease or buy your car. Both are solid options that depend on what your goals are in getting a car, which makes the decision difficult for many people. If you’re on the fence–or you have no idea which is best for you–here are some things you should do to help you decide.
Check Your Finances
There’s no doubt that you have a good idea of your finances if you’re in the market for a new car. That’s good, because your financial state is going to be one of the biggest factors in deciding whether you lease or buy your car. If you’re not buying your car outright, you’ll be taking out a loan to finance the purchase, which may include a hefty down payment. Lease payments tend to be less expensive, with little to no down payment required. Plus, while your month-to-month checkbook balance is important, you should also think about long-term plans. In the short term, low lease payments might be more reasonable, but you don’t have the benefit of having your car as an asset as you would if you paid off a loan.
Consider Your Driving Habits
Your driving habits can also be a deciding factor when deciding between leasing and buying a car. Obviously, when you own your car, you’re free to drive it as much or as little as you like. But if you drive frequently, leasing might not be an option for you. Many lease agreements limit the amount you drive per year to somewhere in the range of 10 to 15 thousand miles. While high-mileage leases do exist, you have to pay accordingly, and you might find that the monthly payments just aren’t worth it.
Weigh Your Responsibilities
As far as vehicle upkeep goes, keeping your car in good working condition is important for both sides. As a car owner, it’s in your best interest (though not required) to take care of your vehicle so that it lives a longer life and is worth more if you want to sell it. On the other hand, as a lessee, you’re responsible for keeping the car in sellable condition at the risk of paying a fine. Either way, if you don’t take care of your car, you’ll be hurting your wallet, though as an owner, you have much more leeway.
Think About Your Car Preferences
Choosing whether you lease or buy a car may dictate the kind of car you get. In general, a lease on a brand-new car is going to be less expensive than a loan payment on the same model. So, if you fancy yourself driving the latest model, you’ll probably find that leasing is the favorable option. Alternatively, your customization options are much more limited when leasing – if you absolutely must have heated seats, a sunroof, and cruise control, the car you have in mind might not be available for lease. Also, with an owned car, you’re free to make any modifications that you wish. Not necessarily so with a leased car.
As you can see, there are a lot of factors to weigh when deciding between leasing and buying a car. There’s no “better” option, so to speak, as people with different necessities choose either option. If you’re still having trouble in your decision, reach out to your local dealers. Not only will they have more information for you, they might also have a deal that makes one of the options more valuable to you.