Adam is right...do not "buy" cars

[Bob]

I buy very expensive cars like Audi A6 types when they come back on the market after a 3 year lease. I have been very happy doing that, I pay less than half price and they usually still have some factory warranty left. Oh, and did I say I pretend I'm that guy from Transporter!

[gman51]

One of the drawbacks of leasing for me is the set amount of mileage each year and paying for each mile over that amount (usually 12,000 miles). It can get very expensive on mileage alone. Unless that has changed since I last looked into leasing. Other than that, leasing looks great. Any info about the mileage that might cheer me up?

[Newday2009]

I drive a 29 year old Mercedes 300SD with 291K+ miles on it. It has been long paid for, and I will continue to drive it until my son-in-law inherits it many years from now.... I will NOT be buying a new car!

[Spec Investor]

With the amount of miles I drive a day leasing is not an option, the amount of miles they set as a limit is crazy. If you want more people to lease raise the mileage levels.

Exactly planters! Why would anyone pay thousands of dollars and be restricted on how many miles they can drive a year? If you go over that amount they charge you an exorbitant rate

PER MILE. To me that's just foolish. The dealers and salesmen actually make more money leasing a car than selling it. When you turn the leased car in with the low miles they restricted you to they can resell it for a lot more due the the low mileage. If you are over on mileage they'll charge you for it. In other words the dealer is going to make his money either way.

Negotiate the best deal and buy.

[Adam Montana]

I would agree with OP IF you simply plan on always having a car payment.

Otherwise, his logic is flawed. I don't plan on returning my Toyota for the money I'll get back... I plan on driving it into the ground.

If my truck makes it 400k, which it will, at 12,000 miles per year which is what most leases limit you to... here's the breakdown.

400,000 miles / 12,000 per year = 33 years of 'leasing'. 33 years x 12 months per year = 396x$350/mo lease = $138,600.

I'm sorry, but I don't think paying $138,600 for a vehicle I don't even own is very smart.

Someone help me out here

I'll pay for my truck, drive it as many miles as I want per year, and save about 100k.

Edited March 12, 2010 by Adam Montana

[Adam Montana]

by the way, next to buying a car - buying a NEW car is the second dumbest thing you can do.

As soon as you drive it off the lot, you lose money.

Smart idea: Let someone ELSE drive it off the lot, decide they want something else, trade it in... and then get the same vehicle for 40% less with only a couple thousand miles on it.

[lsvet]

You are right.. I buy those that need a littel work, fix them up a little and sell them. $$$$

[Zeemann77]

Why is it smarter to lease a new car every couple years than to just buy a car outright and keep it?

It all depends on a persons needs and wants. I to am in the auto industry. I am a Finance Manager for a very respected "Family" dealer in our Bremerton, WA. There are a few reasons that a person may want to "Lease" a vehicle.

1. More options (i.e leather, navigation, dvd) for the same monthly payment: When leasing a vehicle, you have a residual amount (future value of the vehicle), that the lender will determine. Let's say the residual is 50% for easy math. The vehicle you are looking at cost $60,000.00 w/ a residual of 50%, you will only make payments based of $30,000.00 (this also give you a tax benefit of $30k, since you are only paying for 50% of the vehicle). Usually, a lease term (and is THE ONLY WAY TO LEASE A VEHICLE) is for a shorter term, i.e 24 to 36 months (This is why your payment doesn't tend to lower, and stays close to the same as a purchase. the typical loan length that we deal with is 72 - 84 months. Back to the residual. The only time you are responsible for the residual, is at the lease term (end of loan/lease), and that is only if you decide to purchase the vehicle for the residual amount. If you do not choose to purchase the lease out at the end, then return the vehicle to the dealer and start over fresh with a new vehicle. This brings us to number 2.

2. Warranty coverage, and "The New Car Smell". When leasing a vehicle for short term (24 -36 months), you will Always be under the Manufacturer Warranty, and have no reason to purchase an extended warranty (This is where I make my living, by selling after sale item's). As for the "New Car Smell". Most people just gotta have it, and the longer you have a vehicle, that smell goes away.

Those are the 2 main reasons that a person should lease (If it is right for you). Depending on what state you live in, there could be "Tax" benefits available to right off.

So, unless you drive fewer miles per year, love the New Car Smell, and plan on financing a vehicle for short term w/ more options available, then leasing may be for you. Leasing IS NOT for everyone though. If you have to have a "NEW CAR", your best bet is to buy a late model used car, that has already taken it's first years depreciation (this will save you MUCHO DENERO. Make sure the car was not a "Rental" and has a clean "Carfax". There really are car's available that "The little old lady from Pasadena" owned and traded in.

[JMac]

by the way, next to buying a car - buying a NEW car is the second dumbest thing you can do.

As soon as you drive it off the lot, you lose money.

Smart idea: Let someone ELSE drive it off the lot, decide they want something else, trade it in... and then get the same vehicle for 40% less with only a couple thousand miles on it.

Add: letting the poor depreciation-eater also waste a gazillion hours taking it back to the dealer to get the kinks worked out. I choose to let somebody ELSE cool their jets in the waiting room or lug a laptop around to try to get some work done while waiting for that spiffy, newly-depreciated new vehicle to be worked on.

We all may make a boatload of $ when the dinar finally RVs, but in the final analysis money can't even be measured on the same scale as time.

BTW -- I've found that "new car smell" can be purchased in a bottle at most drive-through car wash businesses. Sorry, car sellers and car leasers. Can't think of even one good reason to come see you when $ isn't an issue.

[flippinfool4rv]

Sorry but first I am going to purchase 2 houses one for my son and one for us and. I have worked for dealerships all my life and they are not evil folks they have a right to get profit like any other business so Im going to the nearest Mercedes Dealer and buy the car I want. And enjoy life, I have enough to do anything I want after RV enjoy & enjoy life is short so lets Rock & Roll. Wait, no Im not sorry.

[owensal]

I understand completely. I have a ford and it is going strong

[JMac]

There really are car's available that "The little old lady from Pasadena" owned and traded in.

LOL, that would be me! A single mom in TN, in 1999 I bought a lease return 1996 Nissan Pathfinder with 71k miles on it -- clearly not all that many city miles! -- then proceeded to chauffeur my youngest extreme-cheerleading daughter to competitions all over the Southeast and into Ohio to put another 40k miles on it in <2 years. I work at home, and there are weeks in my two busy seasons in a year that literally the only times I've driven it is to church on Sunday. My old trusty Pathfinder had >100k miles on it by 2001; it's taken me another 10 years to approach clicking off the 2nd 100k and I still have another 6k to go. That's about 8k mi/yr over the past decade, but only b/c I work at home and live in the middle of nowhere, where a "simple" trip to a grocery store is a 50 mile round trip.

Yes, the "little old lady" cars do exist. I wouldn't think they're common, however, b/c us little old ladies like holding onto whatever great vehicles we're able to find! God help anybody who tries to separate me from that old Pathfinder that likes to imitate the Energizer bunny. It just runs... and runs... and runs...

[Mongo]

Do you want to buy this, used ...only to find..................

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[Mongo]

..........out that it used to look like this........................not me

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[gr8cooker142]

Why is it smarter to lease a new car every couple years than to just buy a car outright and keep it?

People usually don't keep it they always trade it in after they pay for it. Leasing is good if you do not drive more then 12,000-15,000 miles a year. If you always will have a car payment and don't drive crazy miles you can find a good lease that will cost less down payment and monthly payment will be less then buying. Then after the lease is all done and said the money you save from leasing is more then what the car is worth when it is paid off.

[seattle]

Ok so I have a lot of cash now and I mean a lot. Do you think that im not going to take two I said 2 bills cash them in and buuuuy a car? Ok I really won't need all of one 1 bill. were talking 25,0000 dinar. Good advice is one thing, but lets be real. Most of us will not live on this planet

as long as we have already lived. buy a dang car! lol

[flippinfool4rv]

I agree I agree Lease it Pay Cash for it what ever but at least enjoy what you got..

[Wagenman]

That's right.............BUY TRUCKS!!!!!

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And make sure its a FORD!

[stunning1980]

I agree, now thats smart. Thats called appreciating what you have; gratitue will always bring you more.

[tiger7]

i don't have a car now, so i will be buying a car.

[Teresa82]

exactly Adam, you never want to take a loan, or lease a car, wait for it to have a year or two off the lot, and then buy it cash. If you can't pay cash for it YOU CAN"T AFFORD IT! Unless you are using it for a write off, but there are much better write offs out there. Dave Ramsey has great advice.

[Bigworm0924]

What a onesided post. You're posting from the standpoint of a person who may not be able to afford to purchase a vehicle outright. I have purchased 1 vehicle new, paid in full from a lot, and all of my other purchases have been gently used, paid in full, from lots or individuals, and each time I do buy a new car, its been 4 years now, but each time, I can lay out a long term cost of payments/leases vs. paying in full, and with the full payoff discounts you/I receive when buying outright and the interest you avoid by paying in full, it would be foolish to NOT pay in full when and if you can. I am not a fan of brand new anyways, but use this approach towards my gently used vehicles. Its a relative matter, if you can afford to pay off in full first time, then it probably isn't going to affect your bottom line. If and when the Dinar RV's, it sounds like most of us should be able to comfortable purchase anything, paid in full, and not feel a pinch in the pocket book. NNot good advice.., I like the post above about painting the used cars too...take care of the old ones! and they'll take care of you.

[kirk motorsports]

i own multible car dealerships and new cars are the worst thing too spend money on period....its nothing but a status statement and the only thing that looses more money is if you used the money too use drugs...a car is nothing but transportation and people have went crazy with the idea of look at me look at me ! sam walton [wal-mart founder] drove a old pickup everyday of his life....look at every thing you buy as an investment and make you desicion as an investment and you will be alot better off...

[mixingking]

Amen and bless the women!!!

[EmilyJJJ]

I agree with J Mac I will keep my old beater. I am on my HOA Board and I have peoples car's towed. The minute I get a nice Car I can bet on Vandalizm. So I will keep my POS and just own my house.