A Discussion of Differing Points of View: Is Jeep Leasing an Intelligent Choice or a Dumb One ??

[Bayou Boy]

This is America Baby.

What I want and what I can afford don't need to match.

That's when all this creative financing comes into play!

That's how I turn my vehicle "Want" into a "Need" that I can "Afford".

So what if it takes FOREVER to pay for it!!!

I can say this. Owning a business, I've been through times where I sweated making payroll for months at a time and I've been through times where cash flowed like water from the tap. Living WELL within your paycheck is an easy way to make a much happier life.

 

[DrivingTacoLoco]

In 1967 the average car cost $3,215, in 2016 Dollars that's $22,807. In 2016 the average cost was : $25,449. Now since 2016 the average price has gone up a bit to almost $30k. That is partially being driven by consumer preferences.

That and government regulations. Cars today have to include lots of things like back up cameras, antilock brakes and such. Not that that's a bad thing. It just adds to the cost.
Lease payments are mostly based on the residual cost at the end of a lease. Cars that start at the same price but depreciate more will have higher lease payments. If you buy something with low depreciation like a 4runner, Tacoma or many Jeeps the lease cost is lower. However the buyout is higher than the same price vehicle that depreciates more.
If you like the vehicle and want to keep it than keep that in mind. Especially of millage is high, you have modified it or repairs are needed. Pinstriping could be expensive. Buying it from the leasing company may make the most sense when the cost to turn it in is too high. .
If you are leasing because the payments get you into a car more expensive than you can afford, you are probably making a mistake. For legitimate business reasons a case can be made for leasing. Otherwise it's definitely more expensive.

 

[shade]

“That's how I turn my vehicle "Want" into a "Need" that I can "Afford".”

Kinda like the phrase, “eat, drink, and be merry for tomorrow we die,” which has been commonly used but still misunderstood for centuries...and yet many of us still choose to follow it.

That's why so many dealerships are located near military bases.

 

[AbleGuy]

That and government regulations. Cars today have to include lots of things like back up cameras, antilock brakes and such. Not that that's a bad thing. It just adds to the cost.
Lease payments are mostly based on the residual cost at the end of a lease. Cars that start at the same price but depreciate more will have higher lease payments. If you buy something with low depreciation like a 4runner, Tacoma or many Jeeps the lease cost is lower. However the buyout is higher than the same price vehicle that depreciates more.
If you like the vehicle and want to keep it than keep that in mind. Especially of millage is high, you have modified it or repairs are needed. Pinstriping could be expensive. Buying it from the leasing company may make the most sense when the cost to turn it in is too high. .
If you are leasing because the payments get you into a car more expensive than you can afford, you are probably making a mistake. For legitimate business reasons a case can be made for leasing. Otherwise it's definitely more expensive.

More on the rising costs of car ownership, FWIW!
New Study: Car ownership costs reach record high, thanks to high finance charges

Study: Car ownership costs reach record high, thanks to high finance charges

“AAA released its latest car ownership cost study two weeks ago and noted that costs have reached record highs. Why the spike? Finance costs. It's worth noting that costs increased in every single category AAA surveys in its study: fuel prices, maintenance/repair/tire costs, insurance rates, license/registration/taxes, depreciation and finance charges. The final category was responsible for most of the increases, however.”


Full story at link above

 

[MOguy]

In my eyes, if you have to do very much calculating and figuring at all when buying a car, you are overspending. Sure, make sure you are making a good deal on that particular car but other than that, just buy something you can afford.

This reminds me of the guys that religiously use Fuelly. Are you going to sell the truck if it doesn't return exactly the mileage you want? No? Then who cares what the mileage is. You will know if it burns too much fuel. But it'll be because its 40% too much, not 10%.

The Initial cost is often not the deciding factor when it comes to the cost of ownership.

 

[MOguy]

Thx for response.
I’m pretty sure I could buy a 2001 Jeep today cheaper than $40k though ?


It all boils down to this:

I’m moving this one to the “Best Advice/Quotes” thread, thx

Of course but buy the time you buy a new one and do a few changes you can't.

 

[MOguy]

That and government regulations. Cars today have to include lots of things like back up cameras, antilock brakes and such. Not that that's a bad thing. It just adds to the cost.
Lease payments are mostly based on the residual cost at the end of a lease. Cars that start at the same price but depreciate more will have higher lease payments. If you buy something with low depreciation like a 4runner, Tacoma or many Jeeps the lease cost is lower. However the buyout is higher than the same price vehicle that depreciates more.
If you like the vehicle and want to keep it than keep that in mind. Especially of millage is high, you have modified it or repairs are needed. Pinstriping could be expensive. Buying it from the leasing company may make the most sense when the cost to turn it in is too high. .
If you are leasing because the payments get you into a car more expensive than you can afford, you are probably making a mistake. For legitimate business reasons a case can be made for leasing. Otherwise it's definitely more expensive.

Read the entire article, it states cost of ownership is LESS now then in the past.

You make some good points. Leasing is a trap. If you want a new car every few years you are "trapped" weather you lease or buy. If you lease when it comes to taxes and finance charge you only pay that on the deprecate (your part of the lease). not the entire amount. Paying all that money to the bank and government is a waste.

For easy math lets say your new car is 100k. Let say the residual is 60%. You will pay tax and interest on 40k with a lease and 100k on a purchase. For easy math lets say your fiancé and tax come out to 10%. That is 10k on the purchase and 4k on the lease. IF you always want a new vehicle why pay all that tax and finance.

 

[Bayou Boy]

The Initial cost is often not the deciding factor when it comes to the cost of ownership.

It’s the largest variable in the cost however.


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[MOguy]

It’s the largest variable in the cost however.


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Nope,

Insurance varies between cars, gas mileage, and repairs.

One transfer case, some electric work, a car that gets worse gas mileage and more expensive to insure will eat up allot of intial saving costs.

If you are in a car for a short time, the initial cost saving will play a big role but for the long haul the few grand you can save buying one vehicle vs the other will be eaten up quick.

 

[AbleGuy]

MOguy said:
“I haven't bought a new car since my Jeep in 2001, it was just over 20k. Now they are 40k plus.”
My original reply:
“Thx for response. I’m pretty sure I could buy a 2001 Jeep today cheaper than $40k though ?”

Then....

Of course but buy the time you buy a new one and do a few changes you can't.

Ummmm, yeah, gotcha.....but that was just a (perhaps poor) attempt to make a lame joke!
You know, “buy a 2001 Jeep today for less than $40k! Not buy a new one today!

Oh, never mind...

Ships passing in the night and all...

(Fortunately comedy isn’t my day job)

 

[ram2500_24v]

Its too bad that jeeps and muscle cars aren't more affordable today. I think people will eventually reason that price and practicality are more important than looks and styling. At that point I think muscle cars and other "fun" vehicles will fade away.

 

[docwatson]

Its too bad that jeeps and muscle cars aren't more affordable today. I think people will eventually reason that price and practicality are more important than looks and styling. At that point I think muscle cars and other "fun" vehicles will fade away.

This makes me sad

 

[luthj]

Nah, luxury, fun, or special use vehicle will never go away. They may change with the preferences of the times, but they will always exist.

 

[shade]

People seem to be enjoying Teslas.

 

[Bayou Boy]

Nope,

Insurance varies between cars, gas mileage, and repairs.

One transfer case, some electric work, a car that gets worse gas mileage and more expensive to insure will eat up allot of intial saving costs.

If you are in a car for a short time, the initial cost saving will play a big role but for the long haul the few grand you can save buying one vehicle vs the other will be eaten up quick.

Insurance cost is very closely tied to replacement value. I thought we were talking new cars so fixing stuff is a non issue. Difference in fuel cost is significantly less than people think when you look at the actual money over time for cars that do the same job.


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