Deciding to buy or lease your next car is a tough decision. Buying a car will leave you with higher monthly payments, but you’re investing in something you will own someday. Leasing gives you a flashy new car with lower payments, but might not be the right choice for you!
Leasing a new car means that even though you’re making payments, the car is still owned by the dealership. At the end of your lease, you will have the option to return the vehicle or buy it. When you choose to buy a car, the car will always be yours.
When you buy a car, the dealership usually requires a down payment and other fees. There are also upfront fees if you decide to lease such as a down payment (if you want your monthly payments to be cheaper), first month’s payment, acquisition fee, taxes, and other fees like a lease protection plan.
Buying a car means you don’t have to worry about how many miles you put on the car. Keep in mind that the higher the miles are, the less resale value the car will have. When you lease, you must choose a mileage limit at the beginning of your lease term.
Sometimes when you buy a car, you decide you don’t like it. In this case, buying is great because you can trade or sell at any time. If you decide you don’t want your lease or can’t afford the payments, you have to break your contract and will have to pay an early termination fee.
The Bottom Line
When deciding to buy or lease your next car consider the following which may help with your decision: Do you put a lot of wear and tear on your car? Do you drive over 24,000 miles per year? Can you afford to have full coverage insurance on your leased car? Weigh your options and make the best choice for you!