Am I a sucker for leasing all of our family cars?

[Anonymous]

Anonymous wrote:

Anonymous wrote:I get a new lease every 3 years. A 43000 dollar car costs me 600 a month for 20 k miles a year. I usually turn it in with 10k over the limit (70k miles total) . All I do is change the oil and I turn it in with balding tires plus I drive the car hard.

So I spend 22 k to suck the life out of a 43 K car and never have a repair. I also get to write off the portion I use for business .

I love when I turn in the worn car for a new one.

Sucker. Car can't be all that great if it needs to be dumped after 3 years...

I drive over speed bumps at 50 mph. Sometimes don't change oil for 15 k miles. Acura .. It starts making weird noises by the time I turn it in and get a new one. I haven't bought new tires in 15 years and have never even talked to a mechanic .

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I get a new lease every 3 years. A 43000 dollar car costs me 600 a month for 20 k miles a year. I usually turn it in with 10k over the limit (70k miles total) . All I do is change the oil and I turn it in with balding tires plus I drive the car hard.

So I spend 22 k to suck the life out of a 43 K car and never have a repair. I also get to write off the portion I use for business .

I love when I turn in the worn car for a new one.

Sucker. Car can't be all that great if it needs to be dumped after 3 years...

I drive over speed bumps at 50 mph. Sometimes don't change oil for 15 k miles. Acura .. It starts making weird noises by the time I turn it in and get a new one. I haven't bought new tires in 15 years and have never even talked to a mechanic .

PP here who drove only used cars for twenty years ...

When I finally got into a new vehicle, it was the absolute best kind of comfort and reliability and I don't think I can ever go back to driving cars until the wheels fall off. I spend too much time driving and I surprisingly really love being in newer vehicles even though cars really weren't my thing.
Husband still drives a really old car, but even he appreciates having a swanky vehicle in the household.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We do the same thing. It works for us. I'm always the one giving rides to people who have their cars stuck in the shop for one issue or another. They can sink their money into a depreciating asset if they want. Car payments are a line item in our budget, and we'd rather pay a fixed amount each month than end up with high car repair bills unexpectedly. It may not make sense to others but it makes sense to us.

The implication of this statement is that you will end up better off, financially, with a lease than by purchasing a new car. That is just not true. There are valid reasons to lease a car - you want a new car every year, you can write off the lease and its easier, you temporarily need low payments, etc. - but deluding yourself that it's a savvy financial move is not one of them. It is unequivocally more economical to keep a car for 8-10 years than it is to lease it.

+1. If leasing was such a great deal, why do all the lease people have to constantly insist what a great deal it is? I view leasing as a tool for people who are only capable of managing their money on a month-to-month basis. This describes every single person I know who leases. They can afford X per month and want the nicest, newest possible car for that X per month. That is literally their entire thought process about leasing.

Not necessarily. We are relatively high earners and right now our only fixed expense is our mortgage and basic living expenses like utilities. Obviously we own our car outright but will need a new car soon. We are trying to invest as much as possible. We bring home around 15k a month and are trying to invest a good 5-7k on top of maxing out retirement. It's appealing to me that a low monthly lease is only $300-400. More money I can save or invest. I'm tempted to lease instead of buy because buying is $700-1000 a month for the same car. We are conservative and not sure how long this gravy train is going to run and simply want to invest as much as possible. I'd rather put an extra $300-400 in the market than invest it in a car.

I understand we'd be better off buying and driving the car for 8-10 years. But it's still tempting to have that low monthly payment and not have a lot of expenditure on a car.

If you are rolling in the dough as much as you said, you shouldn't need to finance the cars at all. Cars are not a "monthly" amount for me. Its paid and its done.

I have no interest in selling stock to buy a car. If anything we'd have to pay tax on the stock sale. I'm trying to keep and add as much to my brokerage account as possible the next five years.

If saving money is a priority for you, then pay cash for a newer inexpensive used car.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I get a new lease every 3 years. A 43000 dollar car costs me 600 a month for 20 k miles a year. I usually turn it in with 10k over the limit (70k miles total) . All I do is change the oil and I turn it in with balding tires plus I drive the car hard.

So I spend 22 k to suck the life out of a 43 K car and never have a repair. I also get to write off the portion I use for business .

I love when I turn in the worn car for a new one.

Sucker. Car can't be all that great if it needs to be dumped after 3 years...

I drive over speed bumps at 50 mph. Sometimes don't change oil for 15 k miles. Acura .. It starts making weird noises by the time I turn it in and get a new one. I haven't bought new tires in 15 years and have never even talked to a mechanic .

This is why you should never buy a used former rental or leased car.

[Anonymous]

Anonymous wrote:Leasing is a horrible deal for the consumer and a great deal for the dealership. Just looked up the Tahoe and even if you pay sticker price, that's 950/month if you qualify for 0% interest.

SO lets do some simple math, 600*120=$72,000 for a decade of leasing Tahoe's. Meanwhile the cost of buying (at sticker) is only $57,000.

Not ro mention trade in value.

I just resold my 2007 Honda for 7k that I bought in 2009 in cash for 21k. That van cost me $145/mo over the course of 8 years. Maintenance was all preventative, so tires, breaks, and the timing belt. And i went well over the miles a lease would have ever provided for.

[Anonymous]

Anonymous wrote:

Anonymous wrote:We also lease. It works for us. We like having the newest technology and safety features. I've bought brand new in the past with the intention of keeping it long term and circumstances changed and I only wound up keeping it 4 years anyway so no more outright buying brand new for us. I've had my fair share of old cars that break down often that I'm pretty weary of buying used. We'll keep on leasing!

And there is absolutely nothing wrong with this. Just please don't join the chorus of people trying to explain that it's better financially - it's a lifestyle choice and preference.

+1

[Anonymous]

Anonymous wrote:I drove a 15 year old Honda to work this am. I got it while in college (thanks Dad!). I have never been stranded in that car. I do put some money into maintenance every few years to keep it running. But. It's hardly this over bearing ridiculous experience to get it serviced. It's been paid off for 10 years, so we have NO car payment. Just insurance/gas and some check ups. No property tax either because it's so old.

So no, I don't think leasing makes sense. Buy a well rated car, drive it until it can not be driven anymore. This is way better use of your money.

+1 owner of 2009 Pilot here

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I get a new lease every 3 years. A 43000 dollar car costs me 600 a month for 20 k miles a year. I usually turn it in with 10k over the limit (70k miles total) . All I do is change the oil and I turn it in with balding tires plus I drive the car hard.

So I spend 22 k to suck the life out of a 43 K car and never have a repair. I also get to write off the portion I use for business .

I love when I turn in the worn car for a new one.

Sucker. Car can't be all that great if it needs to be dumped after 3 years...

I drive over speed bumps at 50 mph. Sometimes don't change oil for 15 k miles. Acura .. It starts making weird noises by the time I turn it in and get a new one. I haven't bought new tires in 15 years and have never even talked to a mechanic .

You are a terrible driver and bad with money. There is an inverse relationship between between credit scores and the cost of driver's insurance. You make the point.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I get a new lease every 3 years. A 43000 dollar car costs me 600 a month for 20 k miles a year. I usually turn it in with 10k over the limit (70k miles total) . All I do is change the oil and I turn it in with balding tires plus I drive the car hard.

So I spend 22 k to suck the life out of a 43 K car and never have a repair. I also get to write off the portion I use for business .

I love when I turn in the worn car for a new one.

Sucker. Car can't be all that great if it needs to be dumped after 3 years...

I drive over speed bumps at 50 mph. Sometimes don't change oil for 15 k miles. Acura .. It starts making weird noises by the time I turn it in and get a new one. I haven't bought new tires in 15 years and have never even talked to a mechanic .

This is why you should never buy a used former rental or leased car.

I laughed when I read that and though the same thing -- as the owner of a former leased vehicle. Fortunately, we bought the dreaded mini-van, which I don't think was quite as ripe for abuse. It was a great deal -- 2 years old, very low mileage, in very good condition, priced to sell in a low-buying season -- and fortunately everything ended up being fine. I knew that people in rentals drove like assholes, I didn't think to extend that to leasing. Lesson learned!

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:How much did you put down to get the lower payments? The payments can be manipulated to anything. Do you know what interest rate is implied in the lease? I would assume a loaded Tahoe is probably about $55k, so if you put nothing down, $600 a month is good and you can get rid of that pos after three years.

$0. Only an idiot puts money down on a lease.

You do realize it's financed in

I put money down on a lease once and all it did was lower the payment that amount give or take a couple bucks. ex. $1000 / 24 months = -$41/month from payment. Also, if you total the car in an accident, you don't get a pro rated downpayment back. It's gone.

[Anonymous]

Bump

[Anonymous]

Anonymous wrote:Bump

Why? The answers haven’t changed.

[Anonymous]

If you don’t keep cars for more than five years, leasing and buying are pretty much the same. Question of preference.

I used to buy. Now, I like tech to be current so I lease- not expensive cars- but I lease.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I drove a 15 year old Honda to work this am. I got it while in college (thanks Dad!). I have never been stranded in that car. I do put some money into maintenance every few years to keep it running. But. It's hardly this over bearing ridiculous experience to get it serviced. It's been paid off for 10 years, so we have NO car payment. Just insurance/gas and some check ups. No property tax either because it's so old.

So no, I don't think leasing makes sense. Buy a well rated car, drive it until it can not be driven anymore. This is way better use of your money.

+1 owner of 2009 Pilot here

I have a 2008 minivan. How old does the car have to be before you don't get assessed property tax?! I just paid.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Leasing is a horrible deal for the consumer and a great deal for the dealership. Just looked up the Tahoe and even if you pay sticker price, that's 950/month if you qualify for 0% interest.

SO lets do some simple math, 600*120=$72,000 for a decade of leasing Tahoe's. Meanwhile the cost of buying (at sticker) is only $57,000.

Did you calculate the time value of money for the $57,000 up front? (I don't lease, always pay cash, but I just wondered if this was truly apples to apples).

It isn't. I ran the numbers.

OP could invest $72k at the start of the decade at 7% and end up with $141,635 at the end. Interest of $69,635 lets him be only $2,500 out of pocket. While the PP paid $57,000 at the start of the decade and by the end of is out $57,000 and is stuck with a 10 year old Tahoe.

I realize that most families don't have tens of thousands of dollar lying around, but if they do, leasing makes more sense.