Lease vs Buy Comparison

Leasing vs Buying a Vehicle

When getting a new vehicle, families often struggle between leasing and buying. Each option has its own set of benefits and drawbacks. Let's break it down!

Key Factors to Compare

• Upfront Costs
• Monthly Payments
• Ownership vs Usage
• Depreciation

Upfront Costs

Leasing

• Typically, lower down payment.
• Only pay for the vehicle's depreciation during the lease term, not the total cost.

Buying

• Higher down payment or larger amount financed.
• The full cost of the vehicle is factored in.

Monthly Payments

Leasing

• Lower monthly payments compared to buying.
• Payments are based on depreciation, not the total cost.

Buying

• Higher monthly payments.
• Payments go toward owning the car outright.

Ownership vs Usage

Leasing

• You don't own the car.
• You must return the car at the end of the lease term unless you decide to buy it.

Buying

• You own the car outright once the loan is paid off.
• There are no restrictions on mileage or modifications.

Depreciation

Leasing

• Depreciation is a concern for the leasing company, not you.
• Return the car and lease a new one at the end of the term.

Buying

• Depreciation affects your car's resale value.
• You bear the risk of the car losing value over time.

Benefits and Drawbacks

Payments and Total of Payments

Leasing

• Benefit: Lower monthly payments and less money upfront.
• Drawback: Never fully own the car; always make payments if you continue to lease.

Buying

• Benefit: Vehicle ownership with no more monthly payments.
• Drawback: Higher monthly payments and initial costs.

Risk of Random Repairs with Ownership

Leasing

• Benefit: Newer cars are often under warranty, reducing out-of-pocket repair costs.
• Drawback: Responsible for wear and tear beyond normal use.

Buying

• Benefit: Long-term ownership means you control maintenance and repairs.
• Drawback: Risk of expensive random repairs after the warranty expires.

Which Is Right for You?

Leasing might be right if:

• You prefer lower monthly payments.
• You enjoy driving a new car every few years.
• You don't want to worry about depreciation.

Buying might be right if:

• You plan to keep the car for longer than eight years.
• You want ownership and freedom with your vehicle.
• You don’t mind higher upfront costs and monthly payments.

Conclusion

Both leasing and buying have pros and cons. Your choice depends on your family's financial situation, driving habits, and long-term plans.

Feel free to drop any questions in the comments below! We're here to help you make the best choice for your family's transportation needs. No matter which option you choose, enjoy the ride! Remember that it's important to consider your budget, driving preferences, and long-term plans when making this decision.

Ultimately, the right choice for you may not be the same as someone else's, so don't feel pressured to decide based on what others are doing. Take your time and carefully weigh the benefits and drawbacks of both options before making a final decision. Happy driving!

Resources

• Edmunds: Buying or Leasing a Car?Consumer Reports: When to Lease vs. Buy Your Next Car - U.S. News & World Report: Should You Buy or Lease a Car?