Personal car leasing is a so-so idea

Remember that TV shows ‘Pimp my ride’? It featured singing sensation ‘Xzibit’ (ok, maybe not singing sensation, but still) taking run-down cars and then doing it up so that they were all ‘bling bling’. Or something like that, my rap-speak lexicon is a bit thin. Anyhow, he recently filed for bankruptcy saying that his being kicked off the show cost him big money. A quick look at his finances reveals otherwise; on a salary of $67,000 a year after being kicked off the show, the guy using personal car leasing services to pay $2,200 a month for a Range Rover. What? The guy is out of his mind…he wants to act like he’s “balling” on that salary.

But it did set me wondering; is personal car leasing a good idea? Yes, it is cheaper than a bank loan or a contract that you draw up, and you give the car back and take a new one when you’re done with it. There are options available where it does make sense to take a leased vehicle, but not everyone will find that it is their cup of tea. Most of the offers available on the television or in the papers sound good. Too good to be true in fact, so make sure you read the fine print before you sign on the bottom line. Primarily, the type of car leased decides the amount you will be paying out towards that lease per month. The bigger and more expensive a car is, the more the payments; that much should be plain and obvious for anyone to see.

If you’re picking between two cars, check out the depreciation value on both cars. That’s because the car that depreciates at a lesser rate will have more value at the end of the lease period and thus cost you less by way of monthly payments. Supply and demand come into it as well, because if more people want the same car it will obviously cost more irrespective of all other factors. As well, it will be easier for the leasing company to sell the car on after the contract has ended if it is a popular choice. Finalizing a car is only part of it all; check everything you can to ensure you get the best deal possible, including little extras like breakdown car and maintenance packages. Every little thing makes a difference.

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