The old adage “it’s better to buy than to rent” sticks in our minds as an unbreakable truth. For generations, the ownership of a car and a home has been definitive of success and making sound financial decisions. While there are certainly positive things to be said about ownership, there are many compelling reasons to lease a vehicle over buying one. Here, we look at the top eight ways in which leasing your next car may be the best decision for your lifestyle and your budget.
- You can get a better car for your monthly payment with a lease than you can with a purchase option. There are many factors for this fact. For one, manufacturers see lease partnerships as an ongoing way to keep you as a customer. (A buyer finishes out their payments and then the partnership is over, whereas a lessee will continue to lease.)
- You can trade in a for a newer model at the end of your lease, which means that you will have a new model car constantly. Buyers are stuck with whatever they chose when they opted to purchase, and often may find themselves with a vehicle that no longer suits their desires. For car fans, leases are a great way to stay on top of trends and in style.
- You protect your own assets with a lease. You don’t have to worry about selling a car or trading a car that you no longer want, you simply return it to the dealership at the end of the lease term. You can choose to renew, begin a new lease, or simply walk away. Be smart and cover your leased car with gap insurance, however. Even if you total a lease, you’ll still be responsible to pay off the entire agreement.
- There are huge tax write-offs for businesses with leased vehicles! This little-known fact can amount to thousands of dollars of savings on your business’ taxes, which might be as much as you are paying for the leased vehicle itself. This means that businesses can often lease a vehicle for essentially free after all of the associated deductions!
- Lease agreements can be more flexible with your credit situation than a traditional loan in many circumstances, and can mean far lower payments than a subprime car loan. Particularly if you have little money to put down, lease payments will generally be much lower per month over the terms of your lease than a monthly purchase payment would be.
- Maintenance and repairs aren’t your responsibility. Under most lease terms, the vehicle will remain under the factory warranty for the entire term of the lease, meaning that those little, or big, maintenance and repair costs will not have to come out of your budget. Some manufacturers even cover the cost of oil changes during the lease term.
- Leases offer flexibility for your lifestyle. While it is true that you are locked into a lease once you have signed, leases will usually last fewer than six years. This lets you upgrade to a bigger vehicle if you have children in that time, or simply put yourself into a more luxurious car after the lease is over if your circumstances have changed. Unlike a purchase, you aren’t saddled with a vehicle “forever.”
- With a lease, you will need to watch your mileage. But if you stay under the mileage your lease terms indicate, you’ll earn lease equity!