To lease or to buy, that is the big question. The answer is in the benefits of buying versus the benefits of leasing. There are many benefits to both forms of agreement, but the general rule is that if you fall short on your monthly budget often but still want to drive a nice car, leasing is the better option. There are many reasons for that.
The Benefits of Leasing
It’s amazing how many people aren’t familiar with the way a lease works. People know about buying and they know the steep costs of renting, but they aren’t familiar with that happy medium called leasing. It’s beneficial for a few reasons.
- Lower monthly payments: If you’re on a budget, leasing is a big relief away from buying. Your lower monthly lease payments will free up more money for other things. That’s not the only way leasing saves you money.
- Lower repair fees: Almost any car you lease will still be under manufacturer’s warranty. What this means for you is that if your car breaks down, the dealership or leasing agency will take care of the repairs for you at no or much lower cost. That saves you big money in the long run.
- Flexibility with your cars: When you buy a car, it’s usually yours for a very long time. Few people can afford to buy a brand new car every couple of years. With leasing, you have the chance to experiment and get a new car every few years with no strings attached after the lease. This is a big perk for those who appreciate many different kinds of cars.
Buying can be great too
While big proponents of the leasing model, there are some advantages to buying a car, too. Among these are:
- Ownership: If you only pay for things you’ll own one day, buying is your best bet. While some lease agreements will end with a purchase arrangement, it’s usually not the case. Leasers love to get something newer at the end of a lease.
- No set miles: Leased cars have a restricted number of miles they can be driven annually. If you want to drive without counting miles, buying a car is the best option.
- Gain equity in car: After you buy a car, it will gain equity over the years as long as your payments outrace depreciation. This is advantageous but not something that most leasers would give up leasing for.
Answering the big question
Leasing versus buying encompasses much more than these few things, but it all comes down to the almighty dollar. If you want a very nice car but just don’t have the budget to buy it, you can still very easily drive that car for a few years and still keep money in the piggy bank. You’ll get an extremely nice car for significantly lower monthly payments, a very small or non-existent down payment, and the knowledge that at the end of the lease, you’re free to shop for a newer, better car.
Leasing is an extremely smart option for those who aren’t looking for a long-term commitment. You won’t be leasing a car for a decade or two, just a year a few years, depending on your preference. Once you’ve paid that glorious end payment, it’s onto shopping for another car you want to lease. Many people prefer to lease a car and never purchase one.