IMO, if the choices are buy new or lease new then lease new is a better decision assuming you can consistently negotiate good lease deals.
The cheaper option though is to buy a reliable car that’s 2-3 year used and keep for 10 years.
Now you’re getting outside of the question. Even though it isn’t the point of the thread, I’ll respond to your points:
Pay off credit card bills, debt, rainy day blah blah blah.
I agree 1000%. But, people looking to buy vs lease aren’t wanting option C. A vast majority of people buying new or leasing new probably shouldn’t be. They should be finding a way to make their current vehicle last until the inputs for repairs exceed the output in usability they are getting.
The second point, which I believe is regarding what a financial planner would think (as i said I spoke to MANY) about keeping a car for 10 years vs leasing one every three - they wanted a third option.
That gets back to my… agreeing with your information but not agreeing as it being the only option. Rather, it wasn’t requested at all. The thread OP asked about leasing vs buying and holding for 10 years. NOT lease, buy and hold for 10 years or keep my current car.
That’s a big assumption. Sometime the leasing incentives are much better than purchasing.
Aside from Toyota and Lexus, not many cars are made to do that anymore. I crap on Hondas a lot, and there’s a reason; Hondas, for the most part, aren’t that reliable anymore… https://www.consumerreports.org/car-reliability-owner-satisfaction/who-makes-the-most-reliable-cars/
IMHO, this is the really the only “consistent” case in which buying makes sense over leasing.
I would say that leasing is superior if you can get consistently good deals, and that’s a matter of timing, luck, macro-economic factors and… not being super choosy about what you drive (for me, it’s this last part that would be a sticking point… I’m pretty pick about what I drive).
For the average buyer, I think the biggest hurdle is getting consistently good deals. Most people presumably aren’t getting good lease deals; the posters here are the exception.
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I’m starting to get skeptical of this one for some cars (especially on the 2 year side). Always check for incentives and interest rates for the new version compared to the used one. Interest rates on new cars are often hard to beat (have you ever seen 0% interest on a used car?). I had a buddy buy a 2 year old CPO Jeep Cherokee, where it would’ve been cheaper for him to buy a new one (they had $4000 purchase cash and 0.9% interest at the time)
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Good post — totally agree — especially if you negotiate a decent dealer discount before purchase incentives — Also many new cars come with 0% financing which is an anomaly on used cars
~70% of new cars are purchased, which means that most people asking the buy vs. lease question already own a vehicle that they could hold for the remainder of the 10-year evaluation term.
Regardless, if you go walk into an emergency room seeking help for an ingrown toenail but you have blood shooting out of your eyeballs, they’re going to treat your eyes first no matter what you say.
But, also consider this - a lot of people are getting great deals from edmunds or sites like them on purchasing. I bet the vast majority are paying through the nose on a 4 or 5 year note let alone those stretching it to 6 years. By that I mean even though the payment is higher vs a lease for them purchasing, they are probably getting terrible deals on top of that to make the payment even higher.
True and love it.
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I’ve never crapped on kia including the honest advice I just gave about sound financial auto planning. The not very fun refers to driving any car for 10 years, but I’ve done that and it saved me thousands which allows me to drive nicer cars now. And yes, I currently drive a Hyundai (Genesis) because I love it
Why would I pay off my mortgage and student loans at 3% interest before leasing?
I agree with the credit card part, but buying used carries a lot of maintenance risk. One bad repair and you’ve basically paid a year of your lease. And for 95% of the population maxing out 401k isn’t possible before paying for transportation costs.
A $300/mo car lease for a $50k earner makes more sense then buying used in most scenarios. Especially if you want a fixed cost budget
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This is simply not true. Spending 4k/yr on 50k pretax might be some of the worst advice. Some of you guys think cars are regularly eating up engines and transmissions at 38k miles just out of warranty. Buy a used optima with a 100k warranty for 10k and drive it for 5 years. Trying to justify a 300/mo lease is pure fantasy if you’re thinking just economics
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There’s actually numbers you can look up and compare. I think these numbers are extremely conservative but even if you subtract fuel and insurance for ease of comparison you’re looking at only $358/mo including all maintenance, taxes, and fees on a very nice newer model Honda and extremely conservative numbers. Tough to find any lease to beat these numbers. Of course you’ll save on insurance too
Again, not a numbers guy, but, in your example, doesn’t the cost per month equal $629? So, in that case, wouldn’t it actually make more sense to lease for $300/mo?
I edited to make the numbers clearer. If you remove fuel and insurance it’s 358/mo all taxes, fees, maintenance, depreciation, etc included. Pretty tough to find any lease that can match that when you include everything and my experience is these numbers are very conservative (high estimates for maintenance repairs).
Also this is for a very nice Honda accord only 3 years old. Buy one 6 years old (still a nice car) and the cost drops to $279 all included except fuel and insurance but now you’d really be saving on insurance
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But people are getting Accord LXs (not sure how that compares to the Sport since I’m too lazy to look it up) for $100 less per month…
Assuming the 4-cyl Sport is close to a base model, I don’t think $360/mo is difficult to beat at all for a mainstream mid-size sedan. I was getting quotes for a 2019 Camry LE (4-cyl) for ~$320/mo (incl tax) last year without trying too hard, and Camrys don’t have a rep of leasing very well. We’ve seen in the $200s/mo for Optimas and Sonatas fairly recently here, I think. And aren’t several posters writing about just under $400/mo for a base BMW 330i?
I think you’re right that when you get an amazing deal you can get close. These numbers I posted include all taxes, fees, maintenance, tires, brakes, etc. Leases quoted here usually don’t include that and they have origination and disposal fees as well. Plus higher insurance.
If you can find a good deal on a lease you can probably score a great deal on a used car (saving a couple grand). The numbers I posted are simply averages. I know people that drive accords for 7 years with nothing more than oil changes and maybe a timing belt
I drove a used car for over 275k miles and had very low maintenance costs over that period. My Mercedes lease required 2 services, tires, and brakes in 3 years and none of that was included in the lease
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right, you just crapped at me for driving a Kia.
I said I don’t think Chevrolet is marketing the corvette to Kia drivers. That’s a fact
IMO purchasing only makes better financial sense if you intend to keep the car 8-10+ years. I personally have never had a car longer than 4 years and have made the mistake of buying new and financing only to get bored and trade the car in after a year. It’s a horrible financial mistake that most people do without thinking over and over again. For most of us, leasing is a much better financial decision.
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I guess you’re right, I never received anything from Chevy advertising the Vette 
The point I’m trying to make is that $350/mo for a base Camcord is not an amazing deal. $350/mo is amazing for a BMW. It seems pretty standard for a base Camcord.
IMHO, you were lucky with your used car and unlucky w/ your MB. The point that other posters are trying to make is that, w/ a leased car, you have defined and fairly predictable expenses. With a used car, it’s a total crap shoot (although you obviously can move things more in your favor w/ a used car from a reliable brand and if you can do basic maintenance yourself).
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