Why I'm Leasing a Car, Even Though I Can Afford to Buy One – The Motley Fool

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by Cole Tretheway | Published on Oct. 6, 2022
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Ownership of a vehicle is an expensive burden to bear.
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My brother and I used to own an old Ford F-150. It was cheap, and if we crashed it into a thick concrete pole (it only happened once), we didn’t have to worry about giant repair bills — we just kept driving the old clunker until one scary day, the engine gave out in the middle of traffic. It was a dignified end to a vehicle that managed to putter on for nearly twenty years past its prime. It also taught me some crucial lessons about car ownership.
Four years and a job later, I can afford to buy a better car. Despite that, I’m leasing. Here’s why.
I’m leasing a car because I remember how much owning an old car sucked. Despite saving us wads of upfront cash, there are costs to owning vehicles for longer than the traditional three-year lease. Leasing is more affordable right now. And as long as I stick to my long-term financial plan, it will continue to be cheaper in the future.

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You only pay off the vehicle’s depreciation, not the full-sticker price (plus interest and fees). As someone who came straight out of college with limited funds, I appreciated this option because it gives me extra cash for rent.
Many things can change in the three-plus years after beginning a three-year lease. Gas prices have skyrocketed, and the cost of used and new cars is wobblier than a bowl of poked Jell-O. Because leasing gives me the freedom to return or buy my car when the contract expires, I’m not worried about going through the hassle of selling my car in a bad market.
This is rather important because I have a strong feeling I’ll want to swap to an electric car as soon as possible to save on gas fees, clean up the environment, and participate in the coolness of owning a vehicle quieter than the sneaky Batmobile.
Leasing my Toyota 2022 Corolla Hybrid began with a fun customization option online and ended with speedy delivery to my shared house. No haggling, no up-selling, and no traveling to and from the dealership. Maintenance fees are covered by warranty and simple to schedule — and knowing that Toyota ultimately owns the vehicle gives me confidence that the company will do its best to keep it in top condition.
Many leases have warranties covering the majority of the lease period. Mine covers two-thirds of my lease and comes with quarterly oil changes and tire rotations. I’m responsible for repairing any damage. Maintaining a brand new car is far cheaper than patching up our old Ford F-150, which averaged over $100 per month in repair fees.
There’s an argument to be made that every generation of vehicles is generally more energy efficient than the last. The recent explosion of hybrid and electric vehicles is violent proof of that. My current ride gives me about 600 miles for $50 at the gas station, and my old Ford gave me less than a quarter for the same price. That said, I do have to be careful that I don’t drive more than my maximum annual mileage, which would force me to pay more per mile.
It depends on your situation. If you can afford the down payment and anticipate being able to meet monthly expenses, then go for it. But blowing the budget is never ideal, so consider a few things before making a decision:
Compare your needs to what’s on the table. If you decide to lease a car, shop around for low rates and strong discounts, like discounts for high-achieving students. And don’t forget to check out similar discounts on car insurance when mapping out costs.
I’m leasing because car ownership doesn’t offer me anything special. I don’t want the hassle of maintaining an aging car, and I’m not interested in repainting my vehicle hot pink or jacking up the tires like a ‘roided Rolls-Royce. Leasing a car fits neatly into my long-term financial goals, and combined with the best auto insurance companies passing out sweet discounts, I stand to save a lot of time and money than I would if I owned instead.

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Cole Tretheway is a personal finance writer for The Ascent. He has a BA in English from California Polytechnic University SLO and is a certified expert in technical and professional communication.
We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.
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