Should you buy or lease a vehicle?

When it comes to buying or leasing a vehicle, the answer isn’t clear-cut. Much depends on your lifestyle.

“How will you use it? Who is going to ride in it? How much do you drive? How long did you own your previous car to really get a sense of what you need,” Blair Qualey, President and CEO New Car Dealers Association, said.

Once you’ve selected your dream vehicle, now comes the question many consumers struggle with – how do you pay for it?  Do you buy  or lease? When you decide to lease, you are often driving a new vehicle under warranty.

“I call it the longest test drive,” Zack Spencer of motormouth.ca said. “You can lease it for three or four years. If you really love the car, just pay the remaining amount and keep the car. It’s just another way of buying a car.

“It really comes down to what you do. Often if you work in sales, for example, you can run the expenses of a lease through your business.”

While leasing is generally lower than financing, it’s not always the case.

“On a purchase some people forget the fact that there’s a bunch of maintenance that’s going to come after a few years that you won’t have to do likely in a lease, but the lease is an opportunity to keep your monthly payments low,” Qualey said. “In the long run, however, you probably might have paid more for that period of time than if you had purchased.”

Also keep in mind, leasing comes with mileage restrictions, which could potentially hit you in the pocket book down the road. “You are still required to maintain the vehicle as you would if you bought the car. You are required to bring it back in reasonable shape considering the mileage that is on it. If you don’t, you could be dinged for repairs,” Spencer said.

If regularly upgrading your vehicle to the latest model  isn’t a priority and you like to own a vehicle for years, then buying may be a  good option. “If you’ve owned your previous vehicle for 10 years, you are probably someone that likes to buy and own a vehicle,” Qualey said.

Once you’ve paid off that vehicle, you’ll be free of monthly car payments, providing your vehicle serves you well and stays out of the shop.