An Objective View Of Leasing A Car
Leasing a car is generally more expensive over the long run than buying and keeping a car for several years. I’ll explain why in a moment. Despite the increased costs, millions of people willingly lease cars every year. The decision is usually a matter of your outlook on your personal finances and your lifestyle. Those who enjoy the feeling of driving a new vehicle every couple of years will find leasing to be an attractive option.
On the other hand, people who cringe at the thought of spending money unnecessarily will likely prefer to keep their vehicles for several years. Below, I’ll provide an objective view of leasing a car. We’ll explore both the advantages and potential drawbacks of doing so.
Advantages To Leasing
One of the main reasons why people enjoy leasing a car is because it allows them the privilege of driving a new vehicle every couple of years. If you typically grow tired of your car after a few years, leasing a new one might be an ideal alternative.
Another advantage is that monthly lease payments are usually lower than the payments for financing an identical car. For example, you’ll pay less each month for leasing a Toyota Corolla than you’ll pay to service the loan for buying that same Corolla.
Of course, leasing isn’t without its limitations. The first disadvantage is that you’ll never truly own a car that you lease (unless you buy it at the end of your contract). This is mostly a financial factor. If you buy a car and make the monthly payments for 5 years, you’ll own the vehicle after the last payment. You’ll still derive value (via driving) from the car even though you won’t by making payments. If you lease a car, you’ll be making payments into the foreseeable future. After 5 years, you won’t enjoy the benefits of owning the vehicle.
Second, most lease agreements limit the number of miles you can drive each year. If you drive more miles than you’re allotted, you’ll end up paying significant fees. That may seem like a reasonable limitation, but millions of people exceed their mileage limits each year.
What Is Important To You?
Ultimately, your decision regarding whether to lease or buy a car (or simply keep your old vehicle) will depend upon what factors are important to you. The manner in which you view your personal finances and the amount of money you’re willing to spend to enjoy driving new cars every couple of years will dictate your decision. The key is to approach car leases with an understanding of the pros and cons, and how they affect you.