Car leasing vs car buying is a huge financial decision. The method that makes the most financial sense will depend on where you live, such as NYC and Los Angeles, or will depend on your financial situation. As an example, if you lease a car – it can be cheaper than if you buy the car. Leasing is a lot more cheaper, than buying a car. The main reason is, because when you are car leasing – you are only buying usage of the car for a set period of year. The manufacturer understands how much the value of the car will drop during those years, and you are paying for those years. In contrast, when you are buying a car – you are buying the entire value of the vehicle.
Your cash flow – is another factor that will decide whether buying or leasing is a good idea. Leasing has a lower monthly payment compared to financing the same loan if you bought the car. If you are having financial difficulties, then car leasing is a much better decision. For example, recently I bought a car, and the car loan payment was $608 per month. The lease is $350 if I do it for 3 years. It’s definitely cheaper!
Another reason why car leasing is a great idea is that car leasing means you can get a new car every 2-3 years. Car leases are short term, which means you can get rid of them soon.