Is a car lease a good idea?

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FIRE 2018
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Re: Is a car lease a good idea?

Post by FIRE 2018 »

It's a no brainer. You got a working truck, still paying off student loans then you want to lease a new or used vehicle? Keep driving the truck. Ford parts are easy to get. Get an indie mechanic you trust to keep it running. Pay off debt as soon as possible. USA economy is driven by most residents constantly in debt and living above their means. Don't be part of the crowd. Be better than that.

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Re: Is a car lease a good idea?

Post by Alphaville »

vexed87 wrote:
Mon Feb 18, 2019 5:25 am
I agree, it doesn't make sense to keep sinking $1k repair bills into a $2k car.
This matters only if you’re looking to resell. Cost per use however is a different story: it’s generally cheaper to repair than to buy. A $1,000 repair that lasts you a year comes to $83/mo, cheaper than any car payment. And you can insure liability only due to low market value which makes for big savings. Of course don’t repair at the dealer... a good indie mechanic and buying parts online for half the price is the way to go.

You only need a newer car when updated safety features make a difference.

E.g., older vs modern car crash test

Certain upgrades like rearview cameras or better headlights can be cheap and easy to install. Others, like ABS... not.

Also, it obviously depends on usage. Commuter vs. recreational, etc.

Getting rid of the commute might be the best move of all ;)

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Re: Is a car lease a good idea?

Post by Forskaren »

I like this explanation about "car fleases":

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Re: Is a car lease a good idea?

Post by ToFI »

Buying used car with cash is better than leasing. Car dealers make money from leasing out a car. It's rental.

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Re: Is a car lease a good idea?

Post by ThriftyRob »

Sorry to have exhumed an old thread but I've been looking at this recently and thought I'd throw in my 2c worth.

There are some videos on YouTube about financing cars. The presenters/influencers seem not to be aware of FIRE principles and admit they are buying high end supercars (Ferrari, Lamborghini, Porsche, etc.) that they couldn't buy for cash as they don't have the equity. I reckon leasing/contract hire is a poor strategy for anyone attempting to save/accumulate wealth. As others have mentioned, owning outright and paying for repairs as the need arises, using specialist mechanics and OEM parts is the way to go.

In the UK, the supermarket-owned banks (Tesco, Sainsbury's) offer loans at 2.9% which may be an option to consider because you can probably earn more than 2.9% investing your own funds with Vanguard, etc.

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