There’s no definitive guide that states that buying a used car will be better than leasing or buying a new car. There are a lot of variables. But buying a used car is definitely a better financial decision. Let’s consider a few other details.
Of course, if you want the latest tech, or want a new car every three years, buying or leasing a new car is likely the right route for you. Leasing may work better than buying if you want to keep your monthly payments low as well.
You also need to consider your lifestyle. Buying a used car is less expensive than buying or leasing a new car, but there are several things to consider. You may have to repair the used car more often and be comfortable handling repairs on an old car. If you’re likely to get bored of your vehicle in a couple of years, then financing a car and keeping it for a long time isn’t for you. Work out all costs, factor in the intangible stuff, and make a decision accordingly.
Advantages of Buying
Once you pay off your auto loan, you can use that monthly payment amount to invest, for household expenses, or keep it in a car repair fund. You can also sell the can whenever you want. Since there’s no lease contract, you can also modify the car in any way that you like. Another advantage of not having a lease contract is no excess wear and tear worry and no excess mileage penalties. You can also choose how much insurance cover you need depending on the depreciated value of the car.
Advantages of Leasing
A lease is usually for three years, and during this time, the vehicle is always under warranty. This means there are no out-of-warranty repairs or high maintenance costs. The routine maintenance you need to pay for doesn’t cost much. If you like the car, you can also buy it after three years at the car’s market value at the end of the lease. This means you could buy it for a bargain if it’s a car that holds its value well. You’re also protected against unexpected depreciation caused by market shifts.