How You Pay for Your Family Vehicle Matters
Did you know that how you buy your new car could affect your family’s flexibility later? Let’s say you’re just starting out and your budget is tight. You may want to consider leasing instead of buying. With a lease, you can put less money down to reach a monthly payment that’s more comfortable for your family. Plus, if your family expands, you’re in a shorter trade-in cycle. That means instead of a five or six-year deal, you’re planning for your next vehicle in two or three years. Keep in mind it’s not always about having another baby, but could be caring for an aging parent.
Besides… nothing says “awkward” more than seeing your mother in the rear view mirror sitting between two screaming kids. And she has got that ”look” on her face, you know “The Look” we're talking about. Mom needs her own row! Time to get a bigger vehicle. Leasing gives you the flexibility to do just that, and you’re not taking a financial hit because you’re not upside down on your trade (owing more than it’s worth.)
But let’s say that everything is good, your family unit is set, and there are no big plans in the future. Then buying is the smart way to go.
As you make your decision, the pros and cons of leasing and buying will give you some good pointers to consider. But, you owe it to yourself and family to do some more homework. After all, purchasing a vehicle is a big financial investment.
Pros: Takes less money to get to low payments, no depreciation value, and short trade-in cycle, get more car for less money out of pocket
Cons: Always a car payment (until you buy), mileage limits, and mileage & condition penalties
Pros: A set number of payments (a payoff), no mileage limits, no condition requirements or penalties
Cons: Long term contract if you don’t put much cash down, 5 or 6 years until payoff, negative equity (trade depreciation)
Many thanks to Bryan Steward, Automotive Solutions Specialist of BrocSport Engineering, for sharing the expert advice above. Contact Bryan at BryanS@brocsport.com.