Excel lease calculator Mar28 '07

# (1 of 3): Jennifer Grucza » jennifergrucza.com

3 hours, 8 minutes after the fact. (Wed 28 Mar 2007, 5:35 PM CST)

Just wondered, given your previous post, where you seem to view cars with a very utilitarian eye, why you lease instead of buying a car and using it as long as possible? If all you care about is if it works and it's safe (and not getting a shiny new car every three years), why spend more money on a lease?

# (2 of 3): Matthom

3 hours, 44 minutes after the fact. (Wed 28 Mar 2007, 6:11 PM CST)

Well for one thing - leasing is cheaper on the monthly payments, since I'm not paying for the full price of the car, but rather just a portion of the sticker price. For example, if I want a $30,000 car - and if I wanted to buy it out, I'd be paying monthly increments into 30,000. A lease, however, drops the price to somewhere more comfortable - let's say around $21,000. Monthly payments into 21,000 is better than into 30,000.

The catch there, though, is that you don't own the car - you are technically just "driving it around" for three years (or however long your lease lasts).

At the end of the lease, you give the car back. And then you have to come up with another down payment on a new car.

There are pros and cons going both ways. I like leasing because it keeps me out of the maintenance shop (after three or four years, the car typically starts needing maintenance anyway).

Typically I lease though because it comes out cheaper per month, and that's where my budget usually gets tight: in the monthly payment aspect.

One thing I always say: "You don't need to necessarily afford the car - you just need to afford the monthly payments."

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# (3 of 3): Jennifer Grucza » jennifergrucza.com

21 hours, 11 minutes after the fact. (Thu 29 Mar 2007, 11:38 AM CST)

"You don't need to necessarily afford the car - you just need to afford the monthly payments."

This is exactly what car salesmen say when they're duping poor unsuspecting people with high interest loans that last a long time - the monthly payment is lower, but in the long run the buyer ends up paying tons more. I'd rather save up money before buying a car so that I can afford the higher monthly payment (or same monthly payment with a bigger down payment) without losing money in the long run.

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