2018 Range Rover
- Thread starter lovingit
- Start date
NEW -> Contingent Buyer Assistance Program
So for those who don’t drive a lot of miles, leasing makes sense.
So not a toilet for everyone.
Again, that's relative and based on only your perspective.
You asked me to "believe you" in that leasing is "throwing money in the toilet" but based on the situation, it's not.
Even leasing computers makes sense for many companies because like cars, they become outdated quickly.
Depending on the car (and computer) and your own situation, leasing new is better than buying new... even buying used is usually better than buying new.
Just like cars, you get more bang out of your buck buying a refurbished computer than brand new.
I think it was said earlier but a good general rule is to buy what appreciates and lease/rent what depreciates... but you have to do the math to make sure it works.
A few pros about leasing you may not know about (and may have already been mentioned):
1. You negotiate the buy price just like in a purchase, the smaller difference between the buy and the residual, the smaller your payments.
2. You negotiate the money factor just like the interest rate
3. You only pay taxes on the lease payment, so not all up front like a buy
4. The residual buy price at the end of the lease is negotiable as it's usually not indicative of actual value at the end of lease. In the last 3 leases I had, the residual at the end of the lease was actually lower than the KBB or CarMax price and so I would make a few hundred to a thousand trading it in or I could sell it for more. If you really like the car, you can just finance the residual and probably be same out of pocket if you financed the buy from the beginning. So you aren't actually left with "nothing" at the end of the lease... buy YMMV.
Just something else to think about. Unless you are rolling in it like USC, where you can buy a car every few months, I like leasing because it keeps me in the newest technology for about the same monthly price. Sure, I'll never "pay it off" but I don't think I'll enjoy driving a 5-year old (much less a 10-year old) car every day. This will change as my kids get older as I will probably buy them their cars but that just depends on what kind of technology and lease plans are out there.
Also think about “opportunity cost “ of tying up your money
For better or worse , our system is designed to reward debtors and punish savers
If you can manage your finances well , i am all for using cheap financing to optimize your lifestyle. Doesn’ t mean you have to lease everything , but it helps to separate out what you really need to own (and are willing to put up significant equity for ) versus what is “pay for use “ .
This is not very different in concept from how businesses are run these days — subscription versus licensing software , cloud computing , how most hotel and commercial properties are run ,etc
irvinehomeowner
Well-known member
eyephone said:
So for those who don’t drive a lot of miles, leasing makes sense.
So not a toilet for everyone.
irvinehomeowner
Well-known member
eyephone said:
Again, that's relative and based on only your perspective.
You asked me to "believe you" in that leasing is "throwing money in the toilet" but based on the situation, it's not.
Even leasing computers makes sense for many companies because like cars, they become outdated quickly.
Depending on the car (and computer) and your own situation, leasing new is better than buying new... even buying used is usually better than buying new.
Just like cars, you get more bang out of your buck buying a refurbished computer than brand new.
I think it was said earlier but a good general rule is to buy what appreciates and lease/rent what depreciates... but you have to do the math to make sure it works.
A few pros about leasing you may not know about (and may have already been mentioned):
1. You negotiate the buy price just like in a purchase, the smaller difference between the buy and the residual, the smaller your payments.
2. You negotiate the money factor just like the interest rate
3. You only pay taxes on the lease payment, so not all up front like a buy
4. The residual buy price at the end of the lease is negotiable as it's usually not indicative of actual value at the end of lease. In the last 3 leases I had, the residual at the end of the lease was actually lower than the KBB or CarMax price and so I would make a few hundred to a thousand trading it in or I could sell it for more. If you really like the car, you can just finance the residual and probably be same out of pocket if you financed the buy from the beginning. So you aren't actually left with "nothing" at the end of the lease... buy YMMV.
Just something else to think about. Unless you are rolling in it like USC, where you can buy a car every few months, I like leasing because it keeps me in the newest technology for about the same monthly price. Sure, I'll never "pay it off" but I don't think I'll enjoy driving a 5-year old (much less a 10-year old) car every day. This will change as my kids get older as I will probably buy them their cars but that just depends on what kind of technology and lease plans are out there.
eyephone said:
Also think about “opportunity cost “ of tying up your money
For better or worse , our system is designed to reward debtors and punish savers
If you can manage your finances well , i am all for using cheap financing to optimize your lifestyle. Doesn’ t mean you have to lease everything , but it helps to separate out what you really need to own (and are willing to put up significant equity for ) versus what is “pay for use “ .
This is not very different in concept from how businesses are run these days — subscription versus licensing software , cloud computing , how most hotel and commercial properties are run ,etc