Pickups the new Luxury Car?

[Tomtint]

Do you think you are out smarting the dealer?

Well Zerk, I was a dealer a number of years ago so maybe I know just a little bit more than the average Joe. Like I said, leases can be extremely attractive for some, if they know how to do them and how they work. If you plan to buy 1 vehicle and keep it for 20 years so you have no car payment. Than a lease is not for you. We rotate out of cars about every 24-36 months. For us they are tools and they are 100% tax deductions as a lease as they are all business vehicles and used for just that. Please do some real research before giving your opinion and posting articles you found online about leasing. And yes,our accountant strongly advises us every December if we should get out of one lease and into another before the 31st.

 

[Zerk]

We rotate out of cars about every 24-36 months.st.

Unlesss you put lots of miles on, you are one of the last people I will take financial advice from.

You don't need to keep a vehicle for 20 years. I budget 150-200k when I run the numbers for my work vehicle. Though I got one at 195k, and I hope to keep driving it. Two guys I work with, with similar jobs both have 300k.

But I don't think you need to do 300k to make money.

 

[Tomtint]

Unlesss you put lots of miles on, you are one of the last people I will take financial advice from.

You don't need to keep a vehicle for 20 years. I budget 150-200k when I run the numbers for my work vehicle. Though I got one at 195k, and I hope to keep driving it. Two guys I work with, with similar jobs both have 300k.

But I don't think you need to do 300k to make money.

If that works for you that's great. We don't keep anything that is out of warranty, and I prefer to take the deduction instead of taking it as taxable income.

 

[Zerk]

We are polarized on car ownership. I don't care about warranty. I have saved up enough money, and have an emergency fund.

I don't think you need to keep a car until it runs into the ground, but I don't want to always be upside down a car and never have any equity.

Unless you are literally a milionaire I don't think you should turn cars over so quick. Interestingly according to Dave Ramsey millionaires don't buy new cars.

 

[esloser]

Thinking you are building equity in a depreciating asset is kind of counterproductive. At the point it flips, how much equity are you really going to have left in that vehicle? I'd argue not much - less than $10k on most vehicles. Meanwhile you've paid tax on the entire price of the vehicle and your warranty is up so you're now saddled with maintenance costs of an aging piece of machinery. I don't see maintenance costs going down, especially with how complex modern vehicles are and how expensive parts are.

I'm not saying buying and keeping for 10 years is a bad option. But, leasing is very attractive if you look at a vehicle as a necessary expense (instead of an asset) like electricity, high speed internet, or a mobile device plan. Leasing offers a new vehicle, lower monthly payments, complete warranty through the term of the lease, included maintenance, and after the term is up you can buy it out, turn it in for a new one, or get something completely different. One downfall is being restricted to mileage.

Just something to think about. And, that doesn't include any of the tax benefits of leading over buying.

I think the point is to pay it off. Like paying your house off. I don't want a payment every month of my life.

Even if you sell it before you pay it off, at some point it does flip and you have equity. You never have equity in a lease. Silly to say are never right side up.

 

[Zerk]

I don't believe in extended warranties, but financially you would probably be ahead, if all you want is peace of mind.

 

[Zerk]

Thinking you are building equity in a depreciating asset is kind of counterproductive. At the point it flips, how much equity are you really going to have left in that vehicle? I'd argue not much - less than $10k on most vehicles. Meanwhile you've paid tax on the entire price of the vehicle and your warranty is up so you're now saddled with maintenance costs of an aging piece of machinery. I don't see maintenance costs going down, especially with how complex modern vehicles are and how expensive parts are.

I'm not saying buying and keeping for 10 years is a bad option. But, leasing is very attractive if you look at a vehicle as a necessary expense (instead of an asset) like electricity, high speed internet, or a mobile device plan. Leasing offers a new vehicle, lower monthly payments, complete warranty through the term of the lease, included maintenance, and after the term is up you can buy it out, turn it in for a new one, or get something completely different. One downfall is being restricted to mileage.

Just something to think about. And, that doesn't include any of the tax benefits of leading over buying.

10k in value is more then you have, and nothing to sneeze at. But not only do I have 10k, I don't have monthly payment.

I drive for a living. If my maintenance costs were to exceed the cost buying another vehicle, trust me I would. With my mileage money, it is easy to justify buying a new vehicle, if I want one.

My yearly maintenance is usually equal to 1 or 2 months of payments. Last two years, has been 1/2 payments. Some years more though.



If you like new cars, just say it. Don't lie to yourself.

 

[Tomtint]

...I like new cars.. I'm going to say it .. But here is a couple scenarios for you. I bought a MB Sprinter for work, truck was roughly 50,000 new. I put something like 10,000 down on it and the payment I'd 560.00 ish per month for 72 mos. this truck gets 25,000 miles a year. I planned to get out of it at the 36 month 75,000 mark and get a new one. However, I could have leased one for 499.00 per month with 2500.00 down 36 months 20,000 a year. I would pay a penalty for excess mileage if I carried the lease to full term, but trade out 3 months early and that fee would disappear. And I don't have a 75k mile truck that's worth less than what a bank note is. This truck should have been leased.

 

[esloser]

Ok - I like new cars. And, I like knowing that if something happens it is somebody else's problem. For me, after looking at all the facts, leasing makes sense. I also don't drive for a living and don't put more than 12k miles on in a given year. I do get reimbursed for business miles, however.

10k in value is more then you have, and nothing to sneeze at. But not only do I have 10k, I don't have monthly payment.

I drive for a living. If my maintenance costs were to exceed the cost buying another vehicle, trust me I would. With my mileage money, it is easy to justify buying a new vehicle, if I want one.

My yearly maintenance is usually equal to 1 or 2 months of payments. Last two years, has been 1/2 payments. Some years more though.



If you like new cars, just say it. Don't lie to yourself.

 

[Zerk]

If you become financially secure, you won't care about warranties.

To me getting rid of a vehicle under a 100k is a financial waste.

You will never be debt free. Maybe leasing in some cases is digging a slower hole.