7 Signs Leasing Your Next Car Is the Right Move

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Navigating car ownership can be a complicated and overwhelming process, but determining whether you should lease or buy is easier than it may seem. Leasing has become increasingly popular due to its financial benefits, such as lower monthly payments and fewer repair costs. 

While buying a car has some advantages, understanding the signs that leasing your next vehicle is the right move for you can help make this significant decision easier. 

In this article, we’ll discuss seven key indicators that leasing might be best for your situation.

1. You Want to Reduce Your Monthly Payments

When getting ready to buy or lease a new car, one of the first things you’ll probably do is figure out how much you can afford. The amount of money spent on your new car needs to fit within your budget. If you’re hoping to reduce the monthly payment as much as possible, then leasing might be the best option.

Lease prices are typically based on the car’s depreciation during the time frame that you’ll be driving the car. However, when you purchase a car, your monthly payment depends on the purchase price of the car, the loan APR, and the loan length. Often, leasing a car will end up having a lower monthly payment.

2. You Want a Shorter Commitment

For some people, getting a new car is about as uncomfortable as a trip to the dentist. This person tends to keep the car longer and put on more miles. This is when it might make sense to purchase your car.

However, others prefer upgrading to a newer car every few years. They either get tired of driving the same car, don’t want to own a car not covered under a manufacturer’s warranty, or want the new bells and whistles. If that sounds a little like you, leasing a car might be the way to go.

3. You Don’t Want to Deal With Major Maintenance Costs

One of the significant benefits of leasing a car is that the lease period is typically between two and four years. And during that time, most cars will still be covered under the manufacturer’s warranty when the lease ends. That means you’ll likely never be financially responsible for any significant maintenance work the car requires. You’ll still need to take care of things like oil changes, new tires, and essential maintenance, but that’s minimal stress compared to a significant car repair bill.

4. You Want a Certain Car But Can’t Afford to Buy It

Has there ever been a specific car you’d love to own, but it doesn’t fit into your budget? Because lease payments are often less expensive than auto loan payments, that dream care may be more affordable than you think. This can be especially relevant to someone younger who may be new to the workforce with little money. You need a reliable car but don’t have a huge budget.

5. There Are Lease Incentives Available

When auto sales are slow, many manufacturers will be generous with the incentives they offer on leases. This could be flexible lease periods, lower down payment requirements, or even reduced monthly payments. When these incentives are offered, leasing a car can be more attractive than buying one.

6. You Don’t Drive a lot of Miles

Over the past few years, more and more people have started working from home permanently. Without the commute to the office any longer, the miles being put on the car are much less. If you only drive 10,000 or fewer miles annually, leasing a car might make more sense. 

Just be aware that if your driving increases, you may get charged a significant fine at the end of your lease. If you think you may end up with more miles, you can always pre-purchase additional miles as part of your lease contract.

7. You Take Good Care of Your Cars

When you lease a new car, you must pay a security deposit. This is very similar to renting an apartment. The car manufacturer wants to protect their investment in case the car is damaged while being leased. If you live where cars are frequently scratched or have kids spilling inside the car, then leasing might not be for you. But if you generally take good care of your cars and keep them clean, it makes sense to lease.

The Bottom Line

If you’re getting ready to shop for a new car, you may be trying to decide if it makes more sense to buy or lease. While there are plenty of advantages to each, these are a few signs that it might be a good time to lease your next car.

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