VisualCalc’s Auto Lease vs Buy Calculator helps consumers decide whether to lease or buy their automobile.
When a consumer sets out to acquire an automobile, they are faced with the “lease vs. buy” decision. This is one of those classic decisions for which there is no absolute “right” answer. The best decision really depends on the specific needs and desires of the acquirer. How much mileage do they typically put on your car over a year? How long do they normally keep cars that they purchase? The answers to questions like these will greatly influence which decision is the right one for that specific consumer.
To make the decision even more complex, there are both financial and qualitative factors that come into play. For example, how important is it to be driving a (relatively) new automobile, with the latest features and styling?
In general, leasing may a good option for people that don’t put a lot of mileage on their cars. When someone leases, they have a mileage limit, and, if they go beyond this, they pay an additional cost for each mile that exceeds this. Leasing may also be a good option for those that prefer to be driving the “latest and greatest” automobile models. At the end of the lease term, they can return your car and lease (or purchase) another new model. This not only enables them to drive a new car with updated features and styling, it also limits many of the maintenance costs they would be subjected to by driving and maintaining an older vehicle.
Purchasing, on the other hand, may be better for those folks that do put a lot of miles on their car (via a long commute, for example), since there are no mileage limits and penalties like those associated with a leased automobile. The insurance rates on purchased cars are also lower than those on leased vehicles. In addition, if someone purchases a car, they still have some residual value in that car once they go to sell it, and this may be a financially positive transaction for them (but this is dependent on many factors). Finally, some people like the sense of ownership that comes along with purchase an automobile.
VisualCalc’s Auto Lease vs. Buy Calculator below can help provide some valuable guidance in this common decision.