Leasing a car is one way of getting your hands on a new model and payments appear more attractive than when you set to buy a new car. Normally, when making a decision we just think of how much down payment we need to fork out, how many months do we have to pay and what’s the rebate. But there are other costs associated with either leasing or purchasing a vehicle.
In choosing between purchasing a vehicle versus leasing, calculate the initial and long term cost of each option -
Leasing Information:
Monthly payment amount $ ______
Security deposit/leasing fee $ ______
Purchase Information:
Purchase price $ ______
Sales tax $ ______
Other upfront costs $ ______
Annual percentage rate on loan $ ______
Market value of vehicle at end of loan $ ______
While in some cases, purchasing a vehicle may seem tempting, there are also circumstances where leasing a vehicle is the smarter choice. It all boils down to doing the math.