Should I buy or lease my last car?


#61

Tires? I bought 17" Goodyear tires for my RDX recently and it was less than $1100 out the door, minus an $80 rebate from Goodyear. With AWD, MPG is maybe 1 or 2 less than our previous TL with just FWD. No big deal. I think the cost of an SUV or compact SUV is being way over estimated. After all there is nothing special about them. Just a different sheet metal box on the same platform.


#62

So we all agree cost of ownership of an SUV is more than a car? Cool, since that was all I really said, aside from overestimating the cost of SUV tires, it seems we’ve run out of things to argue about.

Even at 15%, we’d be talking about more than $10,000 over the life of the car. Call me old fashioned, but I consider $10,000 significant.

I haven’t made a car payment since 2004, redirecting those payments into a retirement account. That has allowed me to invest roughly $44,000 in my retirement in that time. When you add compound interest to the equation, and that $10,000 becomes even more significant.


#63

well, I will not disagree that SUV expense it more than a car

now, getting on original post question: so, Marylin has 19-years old car with 180,000 miles on it

option #1: keep it as it is, pay for repairs as they pop up

option #2: replace with lease

option #3: replace with a purchase

option #1 carries risks Marylin might not want to deal with at her age, this is where thread started

option #2 is the most expensive in longer run

option #3 is lesser expense, but now we have sub-option #A and #B attached: car or SUV

I would say that any option but #1 has immediate expense attached, more or less

I’m not sure I followed where $10,000 came into the picture?


#64

sorry, missed that part

to me these numbers are totally over-inflated

I’ve recently tried to make estimates how much I spent per year owning $27K car over 8 years I had it, I came to the number around $4.5K per year, with some space for error, driving around 14K miles a year

yes, getting 20% over will result in the ballpark number @Whitey provides, even if I’m not agreeing on spending that much per year


#65

UPDATE: then I thought “ok, but is every one expense will be multiplied by a factor of 1.2 ?” and the answer is NO

let’s imagine both cars were the same purchase price, $27K and both final value was $9K (my recent numbers), then depreciation was uniformly eating out $2,250 a year

same applies to bank interests: apples to apples

gas prices were definitely getting a 20% increas, this part is clear

was the maintenance inflated? I doubt it for OP case: same engine, same drive-train, same platform, likely same cost to maintain

so, where I’m leading: applying the factor of 1.2 to the gross expense number is not correct, based on my numbers, it would apply to probably 35-40% of the total annual expense, getting to $3000-4000 difference over lifetime - still noticeable, but not $10K


#66

Yeah, whether you multiply by 1.2 or 1.15 doesn’t really matter for the sake of this discussion. Both are ballpark estimates.

Maybe you should read Tom and Ray’s book to see how they came up with their cost estimates.


#67

ok, some people buy econoboxes, some buy luxury, so average may be $7,483/year, fine

I’ve provided some argument that simply multiplying it by the factor of 1.2 or 1.15 is not correct


#68

I would but I have trouble understanding their accent. Buy a car with a four year warranty and trade it in four years for another. There will be no repair costs and maintenance costs will be minimal. Plus you likely will always be driving a trouble free car. There will be no surprises. Some folks of advanced age are more concerned with utility than squeezing a dime.


#69

Advanced age? Who you calling advanced age? 70?
Them is fight’n words!
:fist_right::woozy_face::fist_left:

You do know I’m just joking about our extra years of experience and wisdom, right Bing?
CSA
:palm_tree::sunglasses::palm_tree:


#70

Yes, inflated they are. Just added up all costs of owning my 2007 Corolla to Dec 31, 2018, including 100% depreciation and the total for 12 years came to $43,238 or $3603 per year.

Tom and Ray may have added Boston area parking in the total and Boston area insurance rates which are very high.


#71

I guess they also added people driving Suburbans exclusively to the nearest convenience store and somebody like a friend of one my friend, who trades Lexus GS every other year and drives under 5,000 miles to his next one :slight_smile:


#72

I believe lease is much preferable now. I use this option as well. Its boring for me to drive one car for a long time. Just my own experience.


#73

let me share one secret: owning your car does not require keeping it over long time

it’s more of “lazy way” vs. “logical analysis way”

it is nothing about “belief” here if you approach it from a logical standpoint, you will find 100s of articles on the topic if you google it


#74

You don’t have to lease to trade in your car every few years. In fact, you can save thousands of dollars by buying three-year-old cars, keeping them for three years, and then selling them. At least that way, you’re getting something for your cars when you sell them. If you lease your vehicles, you’re left with nothing at the end of the lease period, not even residual value.

In both scenarios, you make a down payment, and you make monthly payments, but with owning, you get something for the car at the end. With ownership, you lose value on depreciation. With a lease, you lose that and the trade-in value on top of the depreciation.

The only way I’d ever lease a car is if I was trying to shelter my assets from a lawsuit or a divorce.


#75

I take it you don’t have kids! My wife and I are both college educated with technical degrees making very good money. Raising 3 kids it was impossible to lease. We always had many other things to spend our money on (or saving our money) then wasting it on a lease.


#76

If you do lease and find out in a year you don’t like the car or it is unreliable, it can be hard to get out of the lease without a penalty. If you bought the car, you can simply trade. Ya sure you still might take a haircut but it’s up to you to exercise that option.

I still feel burned from years ago by being dinged substantially for things like an unusual tire wear, cut in trim, windshield divot, etc. I went to court and lost.