Everyone has a different financial and personal situation, so not everyone should make the same decisions when looking for a new vehicle. Leasing a vehicle can be a great way to get the right vehicle at the right price, but there are situations where it makes more sense to buy instead. Before you lease or buy any vehicle, take the time to analyze your situation thoroughly to decide what’s best for you.
When and Why Leasing is a Good Idea
When it comes to personal use, there are many times when leasing a car is the right option. If you want to drive a nicer newer car at a lower monthly payment, leasing may be a good option. When leasing, it’s important to realize that there are often mileage restrictions, and that you don’t own the car during the lease period. Of course, you can almost always purchase the vehicle at the end of the lease term. The best part is, leases are completely customizable to meet your needs and keep your monthly payment down. If you aren’t planning on putting more than 12,000 miles per year on the car, or even up to 15,000, you can often get a lower monthly payment because you’re only paying for the time and usage you agree to put on the vehicle, not paying the whole price of the vehicle you choose.
While leasing a car can be beneficial for personal use, it is especially beneficial to people who can claim their car as a business expense. When a vehicle is claimed as a business expense almost all of the expenses connected with the vehicle can be deducted. Before you go out and lease a car with the intention of using it as a business expense, talk with your financial or tax advisor to make sure it’s the right option for you.
Leasing is coming back in a big way, thanks to huge incentives from manufacturers, low interest rates, and a social media-driven culture that encourages people to enjoy new things more often. If you want a newer car more often, a lower monthly payment and can keep from exceeding your allotted miles, you might find yourself among the 25% of new car buyers who choose to lease a vehicle instead of purchase.
When and Why Leasing isn’t the Best Option
The number one reason not to lease a car is if you are rough on the vehicles you drive. When you return the vehicle at the end of your lease, it needs to be in very good condition. If there are any dents, scratches, window cracks, or any other damages, you’ll be paying for them at the end of your lease. To avoid any surprises at the end of your lease, you can bring it to the dealership for a lease inspection. Your dealer can advise you on your best options from there.
If you can afford to purchase a car outright, do it. It’s not the best option to finance leasing when you can buy the car immediately at an overall lower price and have complete authority over it.
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