5 Questions You Need to Ask Yourself Before Leasing a Car
Leasing a car can be a highly beneficial move apart from being economical as well. With a lot of available options that can help or confuse a person, it is imperative that a person knows what they want.
With easy financing options, buying a car isn’t a difficult or costly affair in one go as well. Since there are a lot of questions that can confuse a person, let’s concentrate on the ones that can help decide if the car is to be leased or bought.
Making any decision for opting for a leased car can be beneficial, but only in the right circumstances. These questions down below will be a huge saviour. Let’s go check them out!
How often do you have to drive?
Quite a lot of leasing companies have a restriction on the number of kilometres a car will be able to cover every year, which might be in the range of 15-20k kilometres. For someone who regularly covers a lot of distance for leisure or who commutes over large distances, leasing may not be a beneficial option. This is unless their plan covers the option for those extra kilometres.
However, if the car is to be used only on certain parts of the years, let’s say for example two to three days a week or so on, then a person can definitely think about leasing a car instead of buying it.
How much money do you have to spare?
Buying a car and leasing a car both carry different sort of investment. In the case of buying a car, since the money is given up front, from dealer, to bank, to insurance and so on, it is direct investment, however, it is trickier than leasing a car and requires a lot of investment planning stemming from proper management of the funds. Also, first-time buyers may end up getting the short end of the stick.
On the other hand, leasing requires no or little down payment and frees more income monthly or overall. Also, since the person wouldn’t have bought the car, a person won’t be affected if they wish to change the car after three years. This will have a lower maintenance cost over the time and the need to repair will decrease as well.
What are your living arrangements?
If a person lives in a busy city that has a robust public transport system, which enables the person to commute faster using the public transport, then the car is needed mostly for meeting friends or family on weekends, and thus leasing a car is a better choice.
Since the person won’t be actively using the car, the car won’t just sit there and gather dust and just need maintenance and cleaning every once in a while. If these circumstances aren’t likely to change in the next few years, then it is better to lease the car.
When the car’s agreement gets completed, the car can be returned rather than thinking about how to dispose or sell it.
Do you own a business?
There are additional tax benefits that are associated with leasing a car and a person can avail them in the form of monthly instalments that’ll go as as a business expense. Some car leasing companies clearly mention this on their website and can help in lowering tax effectively.
Are you more accident prone and thus likely to cause any damage?
This question requires some amount of introspection from the person who has to make the decision to buy or lease. If a person hasn’t been driving for a long time and is likely to cause some amount of scratches, they might be liable to pay more based on the clauses mentioned in the lease agreement for repair work.
To get around it, a sensible thing to do would be to buy a pre-owned car and then choose for leasing any car. This is not only a smart move but also an economical one.
These questions will help you understand the criticalities of leasing and if it can be beneficial for you in the time to come.
Since the down payment or the fees for leasing is higher, one should make sure that leasing is only a small term decision; since otherwise, they may end up paying higher than it would have cost to buy a new vehicle.
Buying a car for the first time is a difficult decision but if there is a need to understand it instead of leasing, you can go through here.
In the end, buying or leasing a vehicle is a personal choice and both carry own merits or demerits, which need to be thoroughly checked before the choice is made.