the penalty for going over the mileage seems to vary. In my contract I have to pay $0.20 per mile. BTW, just took in my G37 for it's 1st oil change...after 5 months. Hahaha. I'm averaging about 750 miles per month. Don't get me wrong, I love my car and I love driving it, but I only rack up about 12 miles a day on it on my daily commute. Looks like I'll have to sell this puppy before lease end and get some money back.

 

Graham, I honestly don't really care about your finances or what you or anyone else does with their money. But I'd really like to know how much you had to put down for the lease, because with your worst case scenario being that you could sell the car private party and walk away with 2-3K in your pocket...i'm not sure anyone could pass up a deal like that! Ever!

I think the simple point to be made about leasing vs. buying is...some people prefer to rent a different vehicle every few years and others prefer not to "waste" their money on something. While the person who rents can say they've had the opportunity to enjoy driving/"owning" several different cars, the guy who purchased his actually owns his/her car (with no payments) after 3-6 years.

I'd personally only lease a vehicle if I needed the money I would be putting down on the car to buy, for something else right now...but I really REALLY had to have the car now. I could lease the car for a few years, put little down on the car, then just purchase the car at the end of the lease. And I'd hope that I ended up not spending a whole lot more "purchasing" the car that way as opposed to if I just bought the car as opposed to leasing in the first place.

This is a similar argument as the one I used to get about why I chose to live in an apartment while I was single versus buying a home and having equity in my home. It's a lifestyle choice.

 

I believe he put down inception fees, so probably somewhere around 1400. I'm leasing my for $418 a month with around $900 at inception over 39 months. (Technically, I put 2k, but 1.1k of it went to payoff my trade-in since I had negative equity on it due to excessive damage) Since I'm averaging less than 1k miles per month, I will more than likely walk way with a thousand or two when I sell my car prior to lease end. I'm not so sure Graham can do it since he is over mileage. He would have to sell the car privately to get equity out of it.
I wouldn't refer to leasing as a "waste". Leasing a car vs buying a car doesn't have a that much in common with renting an apartment vs buying a home. Certainly buying a home vs renting is far more than just a "lifestyle" issue. People's home are sometimes their "nest egg"...I don't think anyone views cars like that. Depreciation will eat away at a cars value until it's practically worthless. That doesn't happen to a house, if anything, a home will appreciate over time. Here in So Cal, homes built in the 40s are worth at least 5 to 10 times what they used to, can't say the same for most cars on the road. There are other differences as well, but you'll have to look at leasing closely to see it. Lets face it, a car is a money pit, depreciation gets you regardless of whether you lease or buy. If you chose to fork out 15-20k upfront so you can "OWN" something, well, that can be consider a "waste" too depending on what kind of financial terms are available. Clearly buying has an advantage if you keep the car for more than 6 yrs, but there are disadvantages to that as well. In summary, nothing is clean cut, some lease deal are sometimes superior to financing. There's a time to buy and there's a time to lease. Right now, its a time to buy, but earlier in the year, leasing was a far better deal.

 

I agree with you on that arguement, when your single you don't know what you'll want from year to year. Career change or living change, obviously its good to build equity, but people flipping and trying to climb the prop latter too fast don't always come out ahead. My thinking is you buy a house to live in at least a decade. To be buying and selling houses every few years, unless you have the money is not that good of a choice IMO, the apartment will give you the flexablity to pursue your desires.
Then settle after you've had your fun and buy a house.

 

I agree on wasting money on the financial terms if you don't make sure to get the best interest rate you can get, or just pay cash for the vehicle.

But it's not a waste to put a large amount of money down on a vehicle when you are purchasing it and you have to finance, you'd have to pay that sometime. It's to the buyers benefit to put more down when you are purchasing.

If there is 0% interest rate for the vehicle, then I'd probably keep half of whatever down payment I was thinking of making and doing something else with that money, like investing it in a CD or something.

 

Wait, with 0% you'd only want to keep half of your down payment? That makes less than 0 sense. Keep the damn money and invest the entire thing in a high yield checking account or a CD. You can pay the extra amount on your loan with the interest from the high yield account and keep what's left for yourself. Seriously? Half? That's terrible advice.

 

i have 15k a year and its only been 9months OOPS lol

 

i too have 15k a year. im at month 3 today exactly and im well over 5k on the milage. 5,410 i think. Yikes!

 

From the dealer's POV and part time Financial Advisor's POV:

Leasing, done right, lowers the cost of ownership of a vehicle.

That does not mean leasing is always better or always worse. It always depends on the car involved and the terms of the lease.

That being said, every new car I've purchased has either been a lease, or cash purchase, never financed.

 

I don't know how you got such a bad deal? My new lease is $650/month for 48 months and I get 24,000kms/yr. there was a option to get 20,000 but I Knew that I would be driving it more.

I wonder if it matters where you leasing from? I'm in Toronto. I love leasing because it's bumper to bumper warranty for the full 4 yrs of the lease, plus a loaner car if any work needs to be done. You never get the money back you pay buying car and I get a new car every 4 yrs! Works for me

 

i didn't get a bad deal, i'm just using my miles pretty quickly. my lease is far less expensive than that.

 

yea, i just took in my G on Thursday for the first time too. odo was at 3500 and it's the 5th month today.

 

Sorry, I'd rather not have a $800 payment every month! 0% interest doesn't change the fact that you just purchased a $40K car.

 

that payment would mean nothng put the down payment in a high interest savings account pay the 400 or what ever you want out of your pay and the rest out of the high interest account. you make money this way.

 

mines leased to, because this car is not going to be worth its residual at the end of the term