The pros and cons of leasing a vehicle.

[Capricious]

Here's what I am seeing. Next year I intend to replace a 2002 truck that I bought new. I am considering a Nissan Frontier, along with others.

Here is a used 2013, 13,600 miles, $18,321.00 Not too far from here.
2013 Nissan Frontier S King Cab 4 Cyl Automatic 4x2 13,XXX Miles Sil


Here is a new similarly-equipped 2015, essentially zero miles, $19,046.00 Not too far from here:
New 2015 Nissan Frontier S (White Truck) N10821 | Serving St. Louis, Florissant & Hazelwood Missouri | Bommarito Nissan

Both dealers will probably try to add extra fees to both prices.

What ever happened to a vehicle depreciating 25% the minute you drive it off the lot? The used 2013 is priced pretty darn close to it's sale price when new.

If one is "into" extended warranties, the cost of a warranty on the used one will probably be higher than on the new one, making the difference in price even less.

If one is getting a loan to buy, the interest rate on the used one will be more.

Yes, this is just one example today, but I am seeing this a lot.

 

[GPintheMitten]

Here's what I am seeing. Next year I intend to replace a 2002 truck that I bought new. I am considering a Nissan Frontier, along with others.

Here is a used 2013, 13,600 miles, $18,321.00 Not too far from here.
2013 Nissan Frontier S King Cab 4 Cyl Automatic 4x2 13,XXX Miles Sil


Here is a new similarly-equipped 2015, essentially zero miles, $19,046.00 Not too far from here:
New 2015 Nissan Frontier S (White Truck) N10821 | Serving St. Louis, Florissant & Hazelwood Missouri | Bommarito Nissan

Both dealers will probably try to add extra fees to both prices.

What ever happened to a vehicle depreciating 25% the minute you drive it off the lot? The used 2013 is priced pretty darn close to it's sale price when new.

If one is "into" extended warranties, the cost of a warranty on the used one will probably be higher than on the new one, making the difference in price even less.

If one is getting a loan to buy, the interest rate on the used one will be more.

Yes, this is just one example today, but I am seeing this a lot.

Good example. Quite a small difference, indeed.

 

[GolfAddict]

No doubt!

I think I see what is up. Since I don't owe on my car, I have a decent trade in number that I got from KBB. Then I estimated about the same depreciation for the new one, and used that for the residual value of the new car after the lease. I took a pure guess that "title, registration, and other fees" would be $4500.

I think what it's showing is that my trade in money is making the lease payments...

So I ran the lease calculator again, this time just leasing the new car for 24 months with no trade in. I used my $4500 number again because I think that may be close. I estimated the residual value based on what I see as depreciation rate of my same model car. My lease payments look like they would be $1011 per month.

If I take the depreciation on my car and divide by the same 2 years, I "spend" about $850 a month. I can't see how it's cheaper to lease, even if you trade up often, which answers my original question.

But how is it that one of the "advantages" to leasing is a lower payment?? I think you need to be an economist to make sense of all this

 

[Dr_Zinj]

Here's a good paper if you want to figure it out for your own personal situation.

Economics Behind Buying versus Leasing a Car

 

[Poopdeck Pappy]

In my humble opinion, some of you guys worry about saving money too much. If you're on a limited fixed income, I certainly understand. Or if you're young and budgeting for your kids' college educations, etc., I understand (and have been there).

But if you're in your golden years and are just being cheap for the sake of pinching pennies, I don't understand. What am I supposed to do, live in a dump and drive a 17 year old car and hoard my money so my kids can p!ss it all away when I'm dead?

I've worked hard and lived fairly frugally my entire life. Now that I'm 62 years old, it's time to enjoy it . . . or at least put it to good use through helping others.

T. Boone Pickens said "At my age a penny saved is a penny wasted!" I won't go that far, but I do sense that some people take pride in squeezing that buffalo nickel just to try to make the buffalo fart.

 

[JJZ 109]

In my humble opinion, some of you guys worry about saving money too much. If you're on a limited fixed income, I certainly understand. Or if you're young and budgeting for your kids' college educations, etc., I understand (and have been there).

But if you're in your golden years and are just being cheap for the sake of pinching pennies, I don't understand. What am I supposed to do, live in a dump and drive a 17 year old car and hoard my money so my kids can p!ss it all away when I'm dead?

I've worked hard and lived fairly frugally my entire life. Now that I'm 62 years old, it's time to enjoy it . . . or at least put it to good use through helping others.

T. Boone Pickens said "At my age a penny saved is a penny wasted!" I won't go that far, but I do sense that some people take pride in squeezing that buffalo nickel just to try to make the buffalo fart.

I'm no Howard Hughes, but I've done alright in life. Life is short, I'm **** well going to have what I enjoy and what I can afford in the time that I have.
To sum up what you said above, I'm not going to be the richest guy in the cemetery.

 

[Dr_Zinj]

If you buy a car every couple of years, then you probably should consider leasing.
If you get it and drive it into the ground over a decade later, you should definitely buy.

 

[Hinomotoman]

Well said.

Eugene

In my humble opinion, some of you guys worry about saving money too much. If you're on a limited fixed income, I certainly understand. Or if you're young and budgeting for your kids' college educations, etc., I understand (and have been there).

But if you're in your golden years and are just being cheap for the sake of pinching pennies, I don't understand. What am I supposed to do, live in a dump and drive a 17 year old car and hoard my money so my kids can p!ss it all away when I'm dead?

I've worked hard and lived fairly frugally my entire life. Now that I'm 62 years old, it's time to enjoy it . . . or at least put it to good use through helping others.

T. Boone Pickens said "At my age a penny saved is a penny wasted!" I won't go that far, but I do sense that some people take pride in squeezing that buffalo nickel just to try to make the buffalo fart.

 

[paulfun9]

So what if I save money by having a plain jane car or truck or driving that truck into the ground before even thinking about replacing it? That just leaves more money for the toys like motorcycles and boats four wheelers and guns. Yep My truck is old and beat but the boat I pull with it is the envy of many folks as its loaded with everything I wanted and keeps that smile on my face all the way home while driving that old worn truck. But the cash saved by being a tightwad about my purchase of the boat also saved me enough cash to justify yet an other motorcycle to play with when I feel like riding something different and by saving lots of cash on the tractor purchase I was able to buy extra attachments that will speed up the work that needs done allowing me more time to play with the boat or the bike

Its not just about spending some money its sometimes more about what do you want for your money? Or put an other way, One Toy or Twenty toys which would you rather have?

 

[Will_C]

I like your thinking Paul. I paid my off my 2004 truck in 2008, then traded my Kubota BX for a B (2009)bought a commercial grade ZTR (2009)and bought my RTV ( 2013). The truck still runs fine- it towed all of the toys home from the dealer. I have also managed to save a considerable amount for construction of a new home.

Will