Leasing Versus Buying A Car

When you’re planning to get a car there are two options that you can choose. One is to opt for leasing the car or the other is to buy it. If you’re rich then there’s nothing more to consider since you can very well afford to pay for any model you like with cash. But not everyone is rich and with the way the economy is behaving today everyone is on a tight budget.

Let’s first differentiate leasing from buying. When you buy a car you pay cash for it and you get to keep ownership of it. Leasing a car means that you pay a fixed amount for using it for a specified amount of time. Once the time is over, usually 2-3 years, the contract expires and the car goes back to the leasing company.

Leasing A Car

• Low Down Payment
• Low Monthly Payment
• Quick Turnover

One of the biggest factors that people choose the lease option is the low cash involved in getting a car. If you are the type of person who loves getting a new car every couple of years then this is a great option for you. Small businesses that plan to get a fleet of vehicles will also benefit from the lease option since they won’t spend as much as when getting their vehicles brand new.

Buying A Car

One of the biggest benefits of buying a car is that you get to own it. Whether you pay or pay it in monthly installments it will be yours to keep. You can do whatever you want to do with it such as sell it. The insurance limits you pay are also lower. The only drawback to buying a car is the higher initial payment you have to make as well as the higher monthly payments compared to leasing.

If you are still undecided as to which option to choose try to get as much information as possible on the two choices. Let’s say that you have found a great model that you would like to drive. Get the details involved if you buy that particular model and if you just lease that particular model. Things to consider are the cost involved, maintenance, depreciation, etc. See which one is more attractive for you.

In the end it really is up to the person on what option they choose. Different people have different priorities. A lease option may look attractive to one person but not to another.

Third and a Unique Option is Novated Lease. In Simple words it is a financially binding agreement that is made between a full-time employee, their employer and a car lease financier. This arrangement allows for a car or vehicle to be acquired on a lease basis for a clients unrestricted use, with payments made through an employee’s salary. You can find out more about Novated Lease at www.1alp.com.au