To buy or to lease?

To buy or to lease?

 Most experts would advise that in the long run buying is more economical than leasing. When you lease a car you are essentially paying for depreciation and financing the difference between what the car cost now, and what it is expected to be worth at the end of the lease—you won’t build equity.

 And, when you turn the car in at the end of the lease you may be responsible for wear and tear or excessive mileage charges. You might want to take this in to consideration if you are chauffeuring kids to and from muddy soccer practices. 

 
Weigh the Difference
 
Leasing Advantages
No or low down payment
Lower monthly payments
Manufacturer's warranty usually covers lease term
Buying Advantages
Pride of ownership
No mileage limitations
Monthly payments have an end
Flexibility to change cars when you want
You build equity over time
 
Leasing Disadvantages
No end to monthly payments
Wear-and-tear charges
Mileage limitations
You do not build equity Buying Disadvantages
Higher down payment and monthly payment
Repair costs once warranty expires
 
If getting a new car every few years is important to you, leasing may be something to consider, however, be careful and pay attention to the realities of leasing. You don’t want to be surprised when your lease expires.