If we take in consideration just numbers, we may have an easy solution to leasing vs buying a car question. Going for leasing means having less monthly payments and less maintenance and repair costs. However these costs remain more or less constant over the entire time of ownership of different cars (if these cars have the same prices). Going for taking a loan to buy a car means having to pay higher monthly payments. But after you have paid all the payments the car is yours and you do not have to pay anything but maintenance and repair costs. This means that in the long term period your costs reduce if you choose buying a car, whereas when you lease monthly payments are constant despite the length of time period. So sooner or later, if you continue to use once bought car, buying a car will turn into cheaper option. But the case is when will this “sooner or later” come exactly.
Beside pragmatic factors the answer to leasing vs buying a car is determined by emotional factors as well. As I discussed in the previous paragraph, buying a car can become cheaper option only if you continue to use your once bought car for a determined period of time. Here the major question you have to answer is whether you prefer to have a new car every 3-4 years or drive the same car for 6-7 years. The answer to this question is not simple. It depends on your lifestyle and your personality.
Another problem is that, although you can measure pragmatic costs, measuring emotional costs is impossible. For example, can you answer the question: how much does it cost for you to drive the same car for 6-7 years? It is really impossible to determine exact number to make further comparisons of the leasing vs buying a car options. However it is clear that when making decision both pragmatic and emotional factor play significant role. The purpose of this article was to show what are the major factors of making a leasing vs buying a car option selection. The comparison and the determination which option is better can be done only by you and by nobody else, because only you know what are your “emotional costs” when choosing one of the options.
I am Giorgi Bisieshvili from Tbilisi Georgia. I have recently finished my studies to get Master Degree in Accounting. I think here I can provide useful articles in my sphere. I will pay special attention to articles about mortgage, credit card.. comparisons like leasing vs buying a car and so on. I think these topics are the most confusing and most needed ones for many people and as I get pleasure from helping them I will post my articles here.