Lease vs Buy a Car (Why I Lease with $0 Down)

[@pedrofernandez8729]

Bought a 2010 Toyota in 2016 for $4k I got offered $3k now, used it for 4 yrs and I'm down only 1 grand. I think I did well.

[@joshgoldstein1568]

Always remember to do the following when returning a leased vehicle: 1) Return with the fuel tank as close to E as possible. This reduces the likelihood of your car being used by dealer personnel for lunch runs, joyrides, etc while waiting for the finance company to pick-up 2) Capture photos AND video of your interior, exterior, and odometer. You can then use this evidence to dispute any surprise lease end charges. Good idea to include something with the date and location like the return confirmation receipt 3) Make sure you obtain a receipt confirming acceptance of the vehicle in writing from the grounding dealer

[@jimandmandy]

4) Don't let them sell you a set of new tires that you are just gifting to them. Get the inspection early and find used tires if any of them are rejected. Mini, for example, has expensive runflats.

[@brianrichards7006]

Thank you. Wise advice.

[@borisgetman9222]

Renting vs buying, leasing vs financing, marrying vs dating, working for someone vs starting your own business, but nothing is more valuable and depreciates quicker than one’s life.

[@scotttabak6755]

42k for a freakin mini is insane

[@TacticalStrudel]

“Lease things that depreciate”. The leasing company isn’t a charity and isn’t eating that depreciation out of the goodness of their heart. If you’re getting a new car every 3 years you are absolutely paying every penny of that depreciation.

[@jd8184]

AKA paying for the experience of driving a new car

[@royalway12]

Don't lease, or buy new. Pay CASH for used. The average finance cost for leased cars in America is 14%. Your point on depreciation is a good one.

[@bluemagic5829]

You're absolutely right. Buy a used car and pocket the extra cash. Invest your money in assets that appreciate. Stop trying to impress people you don't know.

[@kevinamundsen6983]

@@bluemagic5829 It's not necessarily impressing people you don't know. I'm on the verge of buying a brand new car simply because I've been driving used cars my entire life. I'm 40 years old. I finally have the financial stability to buy a brand new car, and I'm looking forward to that experience. I'm tired of driving cars that come with scratches, dings, and the prior owner's mistakes. I want a brand new car so I can treat it the way I prefer.

[@trogman43988]

@@kevinamundsen6983 this is a good point

[@Rzagski]

I own a Lexus suv. I have no payments only maintenance. As reliable as many new vehicles, depreciating or not. I’ve also been stuck. If you have no job and no money coming in at least you own a car and no payment.

[@LAFooFrmLA]

That part. He does a great job of describing the pros of leasing but should of been a little more subjective. It's definitely a luxury to lease and with the money spent over the term of three leases you could of owned a car and had plenty of money left over for maintenance and possible repairs.

[@UltimateTexasHoldemGuru]

@@LAFooFrmLA Exactly. This guy is definitely NOT a FINANCIAL ADVISOR

[@deanrobbins8102]

@@UltimateTexasHoldemGuru He's a salesman ... what did you expect?

[@gandres_07]

@@LAFooFrmLA nothing wrong with leasing. It’s not a luxury to lease. Is renting an apartment considered a luxury? Do what is best for you.

[@LAFooFrmLA]

@@gandres_07 Apples to oranges and a really bad comparison.. For example.. A brand new Toyota corola is about $25k and in my are I've see used ones go for $5k. Even though they are older models I can pick one up for 20% of the cost of buying new and it will still be reliable. You can't find a used home for 20% of the cost of a new home.

[@chrislj2890]

Smart move, as that Mini probably won't last much more than three years anyway.

[@TrinityWilderness1]

Funny because it’s true.

[@johnwren3976]

Quality has steadily declined since introduction. Pre 2005 were the best of the lot.

[@PLT123]

😂

[@Lasertrac]

Zach, cherish and foster the relationship with you father. The love you both have towards each other is very apparent and admirable. Many of your viewers more than likely don't have similar relationships and they are envious. Great job explaining leases.

[@bradj229]

Let’s first agree that owning a car is a liability, not an asset. Also, leasing is the most expensive way to drive a car. You’re basically paying the manufactures depreciation hit for 3yrs, which are the most expensive years. Buy a used car (at least 4yrs old) where someone already took that huge depreciation hit for you. Pay it off. Rub it into the ground. That’s how you “win” in the car game IMO.

[@kittymande]

We also need to really just compare leasing a new car ,and buying that same new car....I wish someone would do a video on that..Buying or lease same new car ,negotiating sales price/cap cost ,and guaranteed value in 36 months.. If it is worth less on a lease ,no worry ,you are guranteed X $$... on a purchase you are only guranteed the market value

[@kittymande]

Brad J . I get your point ,however lease new car or buy 4 year old car is truly apples to oranges... If you buy a new car ,you are paying the depreciation as well

[@fathead3381]

If you want to argue leasing because you don’t want to drive a POS, I can get behind that. But then you lease a Mini and I get all confused.

[@michaelb7718]

😂😂😂

[@katemitchell665]

I’ve been leasing since 2005. Because I take a road trip every couple of years, (40-50+ hours of driving) having a leased car that I can give back every few years gives me peace of mind for those road trips.

[@2011blueman]

Leasing only makes sense if you "like having a new car every 3 years or so", which is a completely illogical financial decision, or it's for a business and you can write off the the lease payments.

[@user-lc7zt8sk6i]

I havent had a new car in 17 years. This video makes me realize my thought process was wrong. I should have been leasing all along. 💯💩🤦‍♂️

[@CarEdge]

Leggo, leasing isn't for everyone and when you think about it, neither is car ownership. You could probably save a ton of money if you just took an Uber or Lyft every time you went somewhere rather than owning, maintaining and insuring your car. Stay safe my friend, Ray

[@reyanpulido]

Your Auto Advocate .... quick question for you. So when I did the math at $380 month for MSRP of $42K, I get a residual of 67% which seems really high for a MINI and a car in general... would you walk me through it please? And what’s your opinion on MSDs?

[@UltimateTexasHoldemGuru]

@@CarEdge Lol at Uber being cheaper than owning a vehicle. Not even close. Leasing without question costs you more than buying as well

[@phanttomracer]

for an individual, you have to be willing to have a car payment for life...and higher expenses like car insurance. I buy cars I like, and keep them til god takes them from me. repairs are always less than a car payment for life. I love my 2001 Audi TT and 2001 Honda accord...never selling either.. will have to be totaled or stolen to take them from me. Some people want a new car all the time, leasing is a good option if you play it right

[@ehsoule]

I find it hard to believe one could come out ahead leasing. The business model requires that the leasing company make a profit and that the remaining value of the vehicle plus total money paid by leaser is worth more than the original purchase price of vehicle plus interest.

[@2007Lynx2007]

If I leased a car I’d be constantly worried about excess wear and tear and excess miles. It would never feel like it was my car and it isn’t. I’ll stick to paying cash and owning my car.

[@robinl6659]

Agree

[@latu8923]

That's why you're doing well in life as far as your finances because you're a saver.

[@MrLanternland]

Same here.

[@CarysCorner]

Too many "what ifs" for me, and no way I could limit my drive to 10k miles per year. I hope that you do a follow-up in 26 months upon the lease return.

[@BirdDogey1]

You can factor a higher mileage into your lease. Very common. Video host just doesn't drive much.

[@BN99239]

It's for those who like a new car every 3-5 years. The mileage limit doesn't matter, sure you pay out of pocket for the extra miles you've driven when you turn in the lease, but what do you think happens if you buy a car, drive a lot of miles, and then in 3 years decide to sell it? Your car price is directly tied to how many miles you've driven when you sell it anyhow, so you would end up selling for a lower price. It's the same. However, at the end of the lease, you can always just buy out the lease and you won't incur the extra mileage fees. Then you can sell it privately after you buy out your lease anyhow.

[@enz6312]

Rev up your engines!!!!

[@anonymous6594]

I hate car payments. I buy a new car every 15 years.

[@davevan6984]

Why so often?

[@bjkjoseph]

Mine is at 16 and I'm driving on baloney skins because I'm not sure if I should invest in new tires.

[@tmorris413]

Me too! I am shopping for a replacement of my 2006 Mazda3 5 speed sedan.

[@viptravels1542]

It's comfortable but never financially smart to lease. 380 x 36 = 13680. You could buy a nice used car, beat it up for 3 years without worrying about excess wear and tear or mileage and still be left with some value in the resale. When I was really dumb I used to lease. Once you add in all these fees you are so behind....

[@sqmus]

The "buy appreciating assets but lease depreciating assets" statement may sound good, but outside of a home, most everything we own depreciates. Were we to follow this guidance, we would lease our furniture, appliances, clothing, pets, etc. Who does that? If the choice is to either put a down payment on a house, or pay cash for a new car, then I agree, leasing the car to free up cash for the house down payment is the way to go, but outside of that scenario, I just don't see the financial advantage to leasing. I admit, I don't know much about leasing, but from what I can see it is a lifestyle, not a financial advantage.

[@brianrichards7006]

Leasing may be valuable in having peace of mind....new car, no or little maintenance, and someone else takes it on the chin if it depreciates hard.....but financially, leasing is probably not a great idea, unless one can use the leased car as a tax deduction.

[@ryanpatterson9526]

The major con is that you're locked in. If your needs or circumstances change, too bad. You're stuck with your car unless you pay off the balance of your payments. There's no easy way out of a car lease. Websites like Swap a Lease and Trade a Lease are expensive to use and generally a waste of time.

[@AK-rza]

Not true. I went from and f150 to tundra 5 months prior to my lease ending. Toyota bought the truck and it cost me nothing. Jumped into the tundra crewmax trd sport for $265/mo with zero down

[@AK-rza]

@Robert Anna my crew cab f150 was $3 a month more. So no I don't agree. Also his point was you're stuck and have to pay off the balance. Which is not true.

[@maxheadroom1207]

Uh oh. beware of the Dave Ramsey followers leaving comments on why you should drive a 94 corolla instead.

[@christopherhachet8204]

I had a 94 Corolla, I blew it up autocrossing it at an SCCA autocross. Fun car while it ws alive.

[@jenniferleigh3767]

Same thought. Dave is right about a lot of things but the guilt he puts in people over not driving a beater is so annoying.

[@markh.6687]

Because would you rather be 'car poor' or 'house rich'?? And you can fix a 94 Corolla without an engineering degree, and enough hardware to service the SpaceX Dragonfly.

[@christopherhachet8204]

@@markh.6687 But everything wears out eventually...which is why the world is no longer full of 94 Corollas.

[@jenniferleigh3767]

I’m all for being smart with your money but I feel there can also be a good balance in getting what you want here and there. And this comes from someone just shy of a six figure income yet happily driving the 2012 Sonata 2.0T they bought brand spanking new about 8 years ago.

[@ZXC_ZXC1]

Leasing is essentially renting a car for life with monthly payments. Thanks for giving us you reasons for leasing.

[@garysimms1347]

Exactly! I never understood leasing so this gives me insight into the thought process of leasing. I have seen instances where leasing equipment for a business endeavor was required by the financial institution to secure the loan so the costs were nailed down.

[@lovelyeyessee]

thanks for the info, trying to figure out whether to buy or lease. Excellent info, thanks.

[@doriss6791]

Don't want a forever car payment. I keep my cars for 10 years or more if there is not any major issues. In that time I save money for my next car so I can do minimal to no financing. I hate owing money.

[@TheGamingAudiophile]

And I hate driving old cars. That’s why I lease. 😎

[@zach7165]

I can appreciate the Scotty reference in the intro

[@consumerdebtchitchat]

Now in my fifties I'm getting ready to turn in my first leased Toyota in October and I am never going back to buying another used vehicle again. I have the ability to pay for a modest used vehicle outright. I still don't want to buy one. I don't care if it saves me a couple of pennies it taxes me more in headaches! I've learned it's not just about what's cheapest it's about what brings me peace of mind and transportation that I feel comfortable driving alone through multiple states from dawn to dusk. No used vehicle I have ever bought I felt comfortable enough doing that in. And always feeling like I was getting ripped off at $100 an hour repair.… Forget it. My lease is under 10% of my monthly take home pay. I have gained more financially leasing then I ever did buying a used vehicle and having unplanned repairs. Great video and I think you two should do more videos together as it was really fun to watch.

[@krehbein]

Yep, similar for me. Sometimes life is more than just dollars and cents.

[@conniestancil2467]

That is the exact reason I'm considering another lease. In this market who knows

[@vw8886]

Key is he wants a new car every 3 years. If you keep it longer buy it.

[@NoName-gv6nm]

Yup you just gotta keep the car for about 10 years for it it make sense. If you go trading in all the time then you're wasting money and may as well lease

[@indridcold8433]

I bought my current vehicle new. Next year, she is getting her first historic plates. I never thought my dear RMS Stargazer was going to still be with me 25 years later. It has been a long, beautiful, wonderful, ride together. I have been through two careers, four jobs, lost all my friends, two girlfriends, 415,000 miles, two homes, have laid seven animal companions to rest, and through it all my dear RMS Stargazer has been through it all with me. What started off as a transport machine late 1996 became a friend in 2000. Today, she is my only friend, my only family in the continent I reside, my only one I can depend on through anything. This year, the coronavirus effected work very harshly and my dear Stargazer was really showing her age and suffered her first breakdown. I lovingly had her taken home and gently revived her to better than she was in 1996 with all the extra time away from work. The tow truck driver asked me if she was going to take my old vehicle to the junkyard. I told her I wanted to take my dear Stargazer home. The tow truck driver said, "This old car is not worth repairing." I had to answer with a small tear in my eye, "She is far more than just a vehicle to me. I will save her." Late October, the RMS Stargazer returned to service and to our continuing journey. I love you Stargazer. I love you forever

[@ratedrpinto418]

On his final question about getting out a lease early, there is another way to get out of a lease early. The dealership can also check to see what your vehicle is worth. If the vehicle value make more sense to go with instead of the remaining payment then the dealership will purchase the car from the bank as if you we’re doing a trade in to make the deal.

[@maycolbetanco6728]

That scotty Kilmer intro though... :D

[@CarEdge]

Shh!!! 🤣Make sure you watch the last 10 seconds! Thanks for watching. -Zach

[@rj.parker]

1, 2, 3, 4 Rev Up Your Engines and Ring That Bell!

[@risinbison1106]

So your paying around $14k for 3 years for a Mini. Whatever floats your boat I guess.

[@kennethisaac3799]

I prefer to own my vehicles and keep them for a long time. I avoid having car payments as much as possible. I buy vehicles that have a reputation for reliability and do most of my own maintenance. I bank all the money that I would be making in car payments and when it's time to buy another vehicle I can just go buy it.

[@markh.6687]

That's why leases should be kept short, because long term the vehicle still depreciates, but you're paying the for the full price of the vehicle the entire term. For individuals, leasing is often a trap for the unwary. Ray's situation is rather different than the average person wanting to lease for personal use. Find a copy of Remar Sutton's 'Don't Get Taken Every Time" (dontgettakeneverytime.com/) which talks about leasing for the average person doing it for a personal vehicle. Ray is totally correct that one should not buy a depreciating asset, but unless you have money to burn, leasing is just another way to make car payments.

[@user-lc7zt8sk6i]

@@markh.6687 Great comment I'm going to enjoy looking for a vehicle to lease. I certainly dont want to throw money away on buying a car. I rather keep my payments between $376-$450 a month and sport a "new" vehicle.

[@brotendo]

2:05 is a pretty big caveat for this video... I just buy because I always hold onto cars for 7+ years. My 1996 Altima had 270k miles on it before I donated it to charity, and my 2004 Civic had 220k miles on it before I sold it and bought a new Impreza this past weekend at 0% APR at $1200 over the invoice price.

[@777AndrewR]

Why would you pay over invoice?

[@brotendo]

@@777AndrewR Uh, because it's the tax on the car. Here in San Francisco it's 9.25%. I said I paid over invoice and NOT over MSRP.

[@CarEdge]

With how long you keep a car, leasing is not for you. Stay safe and thanks for watching, Ray

[@brotendo]

@@CarEdge Indeed. Even though I'd already bought my car this weekend I still like watching these videos.

[@user-lc7zt8sk6i]

#Andrew How much have you spent on repairs and maintenance over the years for your vehicles? Also, after you've paid off the vehicle, you can reduce your auto insurance coverage and that helps save you some coins from your pockets. Ultimately the decision making into your car purchase should be : How long do I plan on keeping this vehicle? What is my projected use of this vehicle? What is the known or expected durability and reliability of this vehicle? Very unlikely an American model vehicle ever lasts more than 5 years without a need for major repair.

[@jpm1211]

Leasing - the most expensive way to operate a car, period! At the end you don't have a car and you don't have the money... but at least you didn't pay for warranty repairs (on a 3 year old car with low miles... huh?) Unless you're wealthy and just view it as pissing away the money to have a nice car, it's a bad financial move. At least you're putting $0 down. Down payments on a lease is a huge risk, if you drive off the lot and total the car your insurance doesn't cover the down payment amount, just the fair market value (and hopefully you pay for gap insurance).

[@cmn96]

If you don't have a car at end of you lease it's because you chosen not to. And as far not having money, there's equity in leasing that you can pocket.

[@dweaver1805]

Insurance is a lot higher for leased cars so you have to account for that in your lower payments

[@mjuberian]

Leasing is stupid for the vast majority of people.. renting and throwing money away and are locked in to a payment have limited miles still have to insure etc and at the end of the lease you have NOTHING!

[@markp.7165]

The thing about leasing is it temps people to buy a car they really cannot afford. Yes they can make the payment but they are dedicating too much money from their budget for transportation. In this guys case it is $13,680 for 3 years plus insurance and gas. A three year old car today is almost like a new car so I say finance it for 5 years then drive it for 7 or 8 and you'll come out way better, We keep cars forever or until they become a problem child. This was part of our plan to be debt free by 55. It worked!! Feels pretty great!! We can actually save and pay cash for a new car if we choose to.

[@geraldslonaker3289]

If you are going to buy a new car every few years, leasing is definitely a great option. Financially, over your life, buying or leasing a new car every few years is bad idea for the exact reason stated in the video. CARS DEPRECIATE. Buy a good car, pay it off, take care of it and drive it 10 or 12 years. It will save you a ton of money.

[@clay282]

I watched this video without much attention because I was always taught to buy. Later I thought about it and watched it again. I have a company car I drive all week and my personal vehicle doesn't rack up miles. I take really good care of my vehicles. I trade every 2-3 years and always end up with almost NO equity. I never thought about it, but Ray made sense. Never leased before, but today I picked up a 2021 Tacoma for 24 months at $232 a month with $0 at signing and Toyota even does all the maintenance for the 2 years. If nothing else... I'll stack back the $300 a month I'm saving to buy a junker for cash when the 24 months is up.

[@cyndeerichards6040]

Great deal. Which Tacoma model did you purchase?

[@joankessel5850]

Yes you were talking about Leasing, but I was interested because you were a Mini owner! Bought my 2013 S Convertible in 2016. Added a second mini to my garage in 2017, the five-door hatchback S. Love a car that comes with friends and a lifestyle that has been so passionate around having a good time.

[@playgroundofsound7683]

Moral of the story work at a dealership. He leases cause he works there

[@06acc]

When I leased a Honda some years ago 2006 it had a $1000.00 excess wear and tear allowance that you could put towards any corrections needed. Read you contract carefully.

[@tableround3019]

Thankfully, when I turned my Bolt EV into a dealership one month early, the vehicle sold for so much at the auction, they waived the disposition fee, the excess wear and tear, and the final payment. (I understand that is not always the case, but don't let the disposition fee scare you away from leasing or worrying that you have to start a new lease at the end of a lease, just be aware that there "could" be a fee at the end of the lease -- the amount varies, but it is in the paperwork you sign when you are in the Finance Office) Please note: I purchased a relatively new vehicle from a family member who no longer needed their car, so I did not start a new lease.

[@DubSportsWins]

I'm a Ramsey fan and have been for a number of years and he is consistence on a "lease" is the most expensive way to drive a vehicle or at around 14% on the money, HOWEVER If i made perfect financial choices every single time I spent money it would be a very boring life so even though 'financially" its STUPID to lease its exactly what I do because I get bored after 3 years of driving a car and will never ever have a car for 5+ years and when the brakes are due I want to be able to go in and say next up ! so what it doesn't make financial sense I'm driving the latest and greatest every 3 years with no money down and less then 350 a month!

[@mechanicjobs]

Another problem is when someone hits your new car, your value drops significantly even if it’s fixed perfectly.

[@thisguy2659]

Go through their insurance Open a diminished value claim. You usually can’t open a diminished value through your own insurance because there is usually something in your policy that you can’t.

[@youtubecarspottersguide1]

I just buy the 2-3 yr lease returns seen some turned in with 10,000 miles

[@angeloiacovella7129]

Depends on how good you are at buying. 2 year old F150 Crew Cab not a single scratch. Sold it 3 years later for the same price I bought it at. No lease is going to match that equity preservation deal.

[@rodneyosmena7461]

Dave Ramsey is on hold...he wants to talk about your "Flease" 😂

[@ernestcassell3227]

@Michael Taylor how is he doing that?

[@limitbreak84]

Lol! My thoughts exactly

[@joed5419]

Ramsey's a TRUMP stooge... if you believe him you'll believe anything

[@rodneyosmena7461]

@@joed5419 if you let politics drive your thought process then get a life...🤫

[@marklark8805]

@@joed5419 Leave your political thoughts in your head. No one asked.

[@lyndahammel9502]

In some ways I can see a lease but it also sure is nice to find a good affordable cash deal and not have a monthly payment.

[@daniels2761]

Leasing is the most expensive way to get a car. Many people will say they'll lease X brand or X model because it might be unreliable, or might dive in value, etc; if you shouldn't buy it you definitely shouldn't lease it! It's either a good, reliable vehicle that you should buy, or it's a bad deal. Leasing it, buying an extended warranty, etc doesn't make it a good car!

[@tmwei396]

@@daniels2761 100%. I always say why would I want a lease a car that I wouldn't want to own?

[@alfredbeauchesne8250]

You can do what I do every (3) yrs . Just make a one payment lease,I do not like to pay interest on a car.

[@naeemahjs]

Leasing is like renting an apartment or a house. Why not buy instead of rent.?

[@richardnoble5763]

another major con to leasing is you get trapped in the leasing cycle. what percentage of people at the end of their lease just walk away with nothing to drive? I'll wager not many. What percentage of people choose to buy the car at the end of lease, I'll wager not many. Also too many restrictions ,Just buy the car and have no restrictions and own it baby!!

[@rj.parker]

Agree. Once you lease you are effectively locked in and have to be happy with that new car and a new set of lease payments every three years. I also think the sellers hide higher interest rates through the money factor.

[@shackrat2331]

Not sure what restrictions you are referring to. I would much rather keep my $30,000 in the bank and make lease payments. For around the same payment you would have the finance for 60-72 months. Until you make the last payment, you don’t “own it”. When you finance, you pay all of the sales tax up front...Leasing you only pay tax on any monies down and your monthly payment. In the 2 states that I have lived in. We all have differing opinions...I won’t change your views and you won’t change mine..CIAO!

[@tmwei396]

I disagree with the idea that you should leasing a car vs. buying, at least for me. If you like the idea of driving a new car every few years, having a warranty you can use whenever something goes wrong, and you staying within the allotted mileage per year then it is for you. But that's not for everyone and nobody who buys a cars considers that an investment. You don't have to be in the car sales business to know it is a depreciating asset. We all know that. Leasing may be right or makes sense for you but not for me. I get that some like to drive a new car every few years and are willing to pay for it but not me. I don't need to drive a new car every year. Some like to have a manufacturer's warranty but for me the best warranty is the one you never have to use. Some don't mind always having car payments but not me. I like to pay for my car and drive it for years and hundreds of thousands of miles without a single car payment. With a Mini, and other European brands you really want to have a valid manufacturer's warranty. I bought a new 2014 Mercedes and I've had to use that warranty many times. Although it's nice to have the warranty, I still had to deal with the issue, be inconvenienced with having to call for a tow truck, and taking time out of my schedule to drop my car off. Even though the repair won't cost me anything directly, it still costs me in time and productivity loss which is worth a lot to me. So for you and your Mini it is a good idea to have a warranty but as I mentioned before the best warranty is the one you never have to use which is why I buy cars with a history of reliability and dependability so I can keep it for many years after the warranty expires. With leasing you will always have car payments. With buying you're done paying after it's paid off. With leasing you're limited to how much you can drive without penalty. With buying you can take as many long car trips as you want.. and we do. With leasing you can't do any modifications to your vehicle. With buying you can do what ever you want. With leasing you always have to be careful to keep it in good shape inside and out. With buying you can let your kids do what kids do in cars on long trips. We have 3 cars in our family and 2 of them have been paid off for years and only about 6 more payments left on the 3rd one. After that we will have no more car payments. We buy reliable vehicles so our repairs are minimal. So for some leasing is the answer but for others it's not. Also, have you researched if more percentage of Europeans cars are leased versus Japanese cars? I bet more people lease European cars and more people buy Japanese cars because you really don't want to own a European cars out of warranty.

[@mjuberian]

exactly

[@tmwei396]

@Robert Anna Yup. I buy vehicles to impress me, not others. Many people are attracted to the "shiny bits". If impressing others with your shiny bits is what you're after and is what makes you happy then more power to you. What makes me happy is having years and years of driving with no car payments. I'm a lot happier with tens of thousands of dollars in my pocket than having a shiny new car every couple of years just to impress others to boost my ego. Another expense that many people overlook is insurance. I'm in NJ and we have one of the most expensive auto insurance premiums, if not THE most expensive. As we all know the premiums for a newer car costs more than and older car. With a leased vehicle you have to have full coverage (liability and collision). Once you own your car outright you can opt out of collision and only have liability. But even if you do keep full coverage the cost would be less for an older car because it is worth less.

[@Cocora22]

I agree with you. Never leased but I keep my trucks for 10 years and still get a little bit of money or a good bit of money when I sell them. I take really good care of then because I enjoy doing that. The feeling of not having a car payment is hard to beat specially if you keep your cars looking nice so you feel like they are still new.

[@tmwei396]

@@Cocora22 100%. I had my truck since new for 300,000 miles and 14 years before I sold it. With a 4-year loan I drove the truck for free for 10 years and that's the best feeling. The truck was so reliable I didn't have to spend much to repair it. Actually now that I think about it I don't think I've had to had it repaired much at all. Of course all the consumables like oil, filters, tires shocks, distributors, plugs, wires, batteries, brake pads and rotors, etc. had to be replaced but you would have to do that with any vehicle. Most of those I'm able to do myself. I also had a sedan I kept for nearly 300,000 over 10 years and most of the time with no car payments. If you haven't figured it out yet, I do drive a lot. I've purchased many vehicles and the dealers are always, I mean always, trying to get me to lease when I was clear from the beginning that I want to buy. Some even try very hard to get me to change my mind. Finally I had to say unless you're willing to give me 30K miles a year on the lease without penalty I don't want to hear it anymore. This sends a very clear message to me when they try to hard to get me to lease and that is the dealers only want you to have your vehicle for a couple of years and then you'll have to get another one so they can move more cars. If you always lease then you'll never own a vehicle and you will never hold a vehicle title in your hands. Your hands are tied and confined to all the restrictions. Keep in mind, it is them that make the rules and spell out the terms and conditions of the lease, not you. They have the upper hand, all you do is sign on the dotted line and keep paying them every month for as long as you lease. I'm not against leasing as it works for some but it doesn't work for everyone, especially not me.

[@victorvaldez6785]

I agree.

[@ksorsomeplace]

Depending on the leasing company (institution), you may be able to transfer the lease to another person vs. paying it off. In some cases when you can do this, you will still be the person ultimately responsible and in other cases you can get your name off the lease entirely.

[@jacobdavid]

All points covered. Good video. But if you want a new car every 3 years, a lease is the best option to go. If you want to save money, and don't have payments after 3 or 5 years, then LEASE is not the way to go. Ownership is good and a car can last for up to 10 years, before you change it out for a newer version. A lease can have a lot of hidden charges and fees, and some dealers are not transparent. Mileage over 10,000 per year are charged at $0.25 to $0.75 per mile driven, so that will keep you looking at the gauge each time you drive. A Lease is not an ownership, so each time you drive it, you will have that in the back of your mind, an unsettling feeling. But if you must have a new car every 2 or 3 years, go for it, provided you want to keep paying every year, till the age you are not able to drive anymore. True, a car is a depreciating asset, but once you own it, it is yours, they cannot take that away from you.

[@oumarngouh6525]

I totally agree with you. Thanks for sharing this with us

[@solomons5669]

Well if you finance a car you still don’t own it the bank does

[@bigeyecat]

Just like always Ray not only shares his wisdom, he is sharing his ride! Who wouldn't just jump right in?

[@markh.6687]

Oh sure. Get in some strange man's vehicle because he's offering me a ride. I know where this is going! :)

[@sdbszz706]

Lmao is that scotties intro lmao

[@CarEdge]

Shh!!! 🤣Make sure you watch the last 10 seconds! Thanks for watching. -Zach

[@sdbszz706]

Haha I just got to it 🤣

[@markh.6687]

Rev up your car heaters!!

[@victhinblueline8097]

Scotty will be pissed off bc he is cheap. Scotty would never lease a car and I am like Scotty!!! Endless money pits!!!!

[@52CA]

Why don’t you explain how leasing is the most expensive way to operate a car. What is the effective interest rate to rent that car?

[@dalewoosley2679]

The Market Price Report is an excellent source of critically useful information to make buying decisions. I used it and took your recommendation to wait until the dealers are willing to negotiate on a 2021 Toyota 4Runner TRD Off Road. Thanks guys for giving this tool to everyone. Dale

[@kjay8534]

Ya sold me Pops! Especially the older I get, looking back, I can see the wisdom of your words. Not only do I get a new car every few years, I know that my car is going to be running like a new car all the time . . . because it is a new car!

[@JsChannel8]

did you know that a new vehicle becomes a used vehicle the moment you cross that line to leave the dealer? lmao dont try to justify a lease, it is literally the most expensive way to drive a car

[@user-lc7zt8sk6i]

@@JsChannel8 Did you not watch the video? I rather keep a "new car" for years than stay stuck in my 7 year old new car and making payments on a vehicle that depreciated so much more over that time span vs a "3 year old new car". Also...you'll be paying full coverage auto insurance for a vehicle that may be costing you over $400 a month in cost for your loan, but no longer worth it.

[@JsChannel8]

@@user-lc7zt8sk6i I did watch it and any intelligent person knows that the dealer factors in the depreciation and the customer pays it. What idiot pays on a car for 7 years!? Lol if it takes you 7 years you can’t afford it!!!

[@user-lc7zt8sk6i]

@@JsChannel8 I'm guessing you're part of the ELITE 10%. Kudos to you, Jason. Look up the history of auto loan terms....

[@JsChannel8]

@@user-lc7zt8sk6i I am not and yes I know the history of it. Leasing is part of the reason that 78% of Americans live paycheck to paycheck. I looked into a new Tacoma in February. Payment on a lease was 324 a month and over 200 was interest! That is just stupid!

[@nicholasbabeaux2052]

BMW and mini are especially forgiving in regards to wear and tear, tires are 4/32nds, disposition is 395 which is waived if you buy another BMW or Mini. Three years 36000 mile maintenance included, and most Mini dealers are also BMW dealers so when you get a service loaner oftentimes they will give you a BMW. When I was turning in my last BMW I had a chip in the windshield which turned into a crack, five months prior I lowered my insurance deductible to $100, father claim and put a new windshield in red before I turned in the car👌🙏

[@kevinc6763]

I would suggest, when possible, sell the leased car at the end of the lease. I have sold every lease I've owned to the dealer I am getting a new lease through and rolled that equity into the new deal. Never turn in a lease and lose the equity.

[@conniestancil2467]

Could I get the equity in the form of a check; instead of rolling it into another lease?

[@kevinc6763]

@@conniestancil2467 sure, just sell the car

[@dwaconsulting1609]

You guys should swing over to Waldorf MD so we can go car shopping

[@onfin3al6]

Leasing is never ending car payments , you have to pay for all the maint . then after a year you turn it in and start over .

[@joegadget670]

Some leased cars come with all maintenance included for the lease term. Since cars are depreciating assets, they are also never ending in payments. It’s just that the “payments,” a.k.a. purchase price, are made much less frequently than monthly. Try calculating the $/mile over the time span you plan to keep a car. That’s a rough estimate that can help compare buy or lease options.

[@UltimateTexasHoldemGuru]

It will always be cheaper to buy vs lease

[@jeffreyhall8195]

@@UltimateTexasHoldemGuru I agree with you except this scenario: my daughter has two-three years left on a teaching contract and her car has just crapped out. Not knowing what happens after that, she is considering leasing, which will be less than buying over the same period of time. After the 2-3 years, she'll have to re evaluate and would buy if her teaching contract was extended.

[@JohnS-il1dr]

I can't lease i drive 25k miles a year and they want less than 12k a year. I always thought of leasing as glorified car renting

[@UltimateTexasHoldemGuru]

Its a waste

[@phanttomracer]

it is not LIKE glorified renting... IT IS glorified renting! May not be a bad deal.. if you want a car payment for life... Something I just can't afford. Nice to buy a car, pay it off in 3-4 years and drive it 20+ years (don't try this with a hybrid/electric car though!)

[@michaeloliva3759]

Love that color. I’m with you Ray, I’m a leaser too. Love that it’s always under warranty. I’m half way through my current lease which allows me 31,500 total miles for 3 years. I’m at 11,000 right now. I’m driving a $50,000 SUV with no money fown for $419 a month

[@billywalik6411]

I would be interested to know what other vehicles you have leased. Are you near a dealership? Sounds as if mileage is not a concern. From other of your videos, is it true that all service must be done at a dealership? Billy Walik

[@michaeloliva3759]

@@billywalik6411 I’m a Ford guy. I’m currently in a 2019 Explorer Limited. I have had all my leases serviced by my own mechanic.

[@user-lc7zt8sk6i]

#Michael Olivia Sounds like a stellar deal!! Did you have to negotiate a lot for your terms to the lease? I'm definitely interested in leasing, but unfamiliar with the process. I hear that the rule of thumb is to not get suckered by the tv ads...those arent the best leasing deals. Any input? CONGRATULATIONS again on your awesome lease!

[@michaeloliva3759]

@@user-lc7zt8sk6i I leased my 2019 Explorer Limited in July of 2019. The new design 2020 were about to come out but I wasn’t sold on the new look at the time(I like it now) My dealer is a one price non negotiable store. The price they had on the windshield was $8000 off the sticker price! Plus there was $3500 in incentives from Ford it was a no money down lease except fir first months payment. I opted to pay the tax up front also though. With leasing there’s no BS from the finance office to add warranties or anything because I’m turning it in for a new one in 3 years. I was in and out of the dealership in just over an hour!

[@michaeloliva3759]

@@user-lc7zt8sk6i also I think the low lease payments in TV ads are fir the bare bones models

[@allenpaul102]

People driving old cars they bought because David Ramsey told them to seem really salty about people driving new cars on a lease. Is it because they waive as they drive by when your car is broken down on the side of the road?

[@UltimateTexasHoldemGuru]

People who lease always wonder how their friends who dont lease vehicles can live in nice houses and take regular vacations.

[@travis1240]

The only thing worse than paying for depreciation is paying for depreciation over and over and over again. If you want a new car every three years, you will be doing that whether you buy or if you lease.

[@gregoryclemen1870]

scotty says" REV UP YOUR ENGINES" he is a real hoot, I like his honesty!!!!

[@scottrasmussen8258]

Ray, one thing I would like your thought on. You said you have driven 1,750 miles in 10 months on a 30,000 mile 3 year lease. At your current driving pace, you will drive 6,300 miles over the lease. Isn't that leaving a lot of money that you paid on the table?

[@CarEdge]

Yes Scott it is, but I did not anticipate a pandemic that really cut down on my driving. Not to sound like the President, but who knew? Stay safe and thanks for watching, Ray

[@daniels2761]

If he had purchased the car outright, he probably would have been able to sell it if needed(some lightly used models have been selling for more than they did new). Just a really good example of why getting locked into a lease can go really badly.

[@stevensalter9697]

TCO is higher with a lease, you never stop having Monthly payments. To each their own. My car is paid off and will last for 10-15 years. Enjoy all those 10-15 year payments because you keep turning in something, and then charged all the wear and tear fees, excess milage.. etc.. FLEASE. (Fleece)

[@conradbarrett6]

No one keeps their car after 15 years lol u must be an old person

[@lobsterman5786]

You two guys are great to watch and very informative.

[@tgrujic1965]

Not a fair comparison since you get an employee discount...main negatives for me is you have to baby it, mileage restrictions, and the usual ballon down payment which when you average it out with your monthly payments negates the lower payment arguement.

[@carolinebaranczyk1131]

Yes...I go to Scotty for mechanics and I turn to you for finance.

[@Sebastien47136]

I was about to rev-up my engines. :D

[@americancitizen1885]

For me leasing a vehicle is not an option as I need around 40K miles a year and most lease are limited to 10k,12k,15k a year. That would cost me over $6k a year extra in mileage then besides the normal lease cost, plus excessive wear? But for my wife that only drives within the 10k miles a year, it would be perfect because she could have a brand new dependable car every 2 to 3 years, full warranty in case something bad happens, included maintenance in some cases and a very low monthly payment. But back to my case of buying a car in my situation, the bad part is to be out of warranty within the first year and a half, have a vehicle with over 120K miles on it and only being half way through the loan. Is not fun to look at 3 more years of payments when your car is already a high mileage vehicle breaking down all the time and out of warranty still owing $20k still to the bank.

[@harrywalter9462]

You're correct Chris about the garbage that the mini is. I'm retired from the car biz after nearly 33 years. I lease a new Honda every 3 years and have for the past 30 years. With only one exception I sold each vehicle on craigslist for much higher than the residual. Leasing can be profitable if you know what you're doing. With all the cars available, one of the last ones i'd look at is a mini. It will have to be retuned cuz of its high depreciation. The only vehicles i would consider buying are those assembled in Japan. V.I.N. matters!

[@bendosia]

This is a little late, but are you saying you sell the vehicle for an amount, then pay off the car when you return it while you pocket the remainder? For example, you sell car for 20k, the RV on the leased car is 18k, so you pay off the 18k amount remaining on lease and pocket the 2k?

[@philyip4432]

Sounds very enticing except for the low miles allowance.

[@allenpaul102]

Mileage is negotiable.

[@Soundsaboutright42]

If I had a mini or bmw I'd only lease it too.

[@Troy-fv9uq]

FYI: Not all BMW's are bad. 40's number BMW's with the B58 engine are great cars!

[@Soundsaboutright42]

@@Troy-fv9uq Not saying they're bad cars, just not something I'd want to own outright

[@Soundsaboutright42]

@Dewy Gable Whatever helps you sleep at night buddy

[@frankszczepanski1217]

"After 100,000 miles they become endless money pits" Scotty Kilmer

[@scotttabak6755]

Remember the old Ford Red Carpet Lease? All you had to do was pay the car half off in 2 years then give them the Taurus or crown Vic back with less than 24k miles. That was a dealers dream

[@TheGecko213]

Yeah , let the buyer eat the depreciation 😄

[@SophieMia806]

Scotty Kilmer says: "Rev your engines!" Hahaha! 😂 I knew I felt Scotty Kilmer vibes at the beginning. Lol Good video, guys. Thank you for the information. 😊

[@jonsmith1259]

My Dad leased a car for 3 years. Halfway through the lease, he had to quit driving due to failing health. penalties were over $5,000 +(This was on top of the remaining payments) I will not name who it was, but he only had 1,500 miles on it when turned in.

[@user-lc7zt8sk6i]

Sad to hear of your father's health. Hopefully he is better. Lease or purchasing would have potentially resulted in encountering the same issue. Why didn't you name drop? FORD wouldn't have cared.

[@jonsmith1259]

@@user-lc7zt8sk6i If Ray or Zach say it is OK to name drop, then I will. I do not wish to unless they say so.

[@tomcannone9875]

Having leased cars for the last 15 years I call BS on his payments for a $40k+ auto. True he claimed he got employee pricing, but leasing Is based on the auto’s price, dealer incentives And taxes.To walk out of a dealer with NO money down he would have to pay taxes up front or roll them into the monthly lease payment increasing the total monthly cost. One thing he mentioned is very true, it is a depreciating asset, and leasing is a great way to walk away from repair costs and the hassle of selling when you you are finished......

[@CarEdge]

Tom, I can assure you that I put no money down, zero, not a penny and on the 28th of every month MINI Financial Services takes $380.70 out of my checking account. In Maryland the sales tax is rolled into the cap cost and is part of the payment and it s all possible because of the way BMW-MINI handle employee pricing and allow that to be combined with whatever the customer incentives are at that time. So yes, if I wasn't able to take advantage of the system as it is set up my payment would be significantly higher than what I am paying. Happy Thanksgiving to you and your family, Ray

[@Normambo]

That wasn't a comparison analysis but a preference. What makes leasing advantageous to Ray is the premise that one wants to change vehicle every 3 years. I agree that would be the way to go if considering very low milage. On the other side, someone who wants save some money and doesn't mind keeping a car 7 to less or equal than to 10 years, might prefer buying especially if one buys very reliable cars with good resale value; Toyota or Subaru for instance. When properly maintained, a reliable car will remain low cost on repairs. Considering market depreciation, cost of repairs and resale value, i've come up to the conclusion, based on my assumptions of these numbers, to find the point of indifference to be about 7 years which means that the purchase becomes advantageous starting at that time period. Once again, this sweet spot will vary based on a number of variables and assumptions. Not to bore anybody with numbers, lets just mention that the greatest depreciation rate is within the first 3 years and slows down afterwards; in a lease, you're always in the fast depreciation range at repetition car after car. A lease is basically a balloon loan where the balloon equates to approximately the residual value. Fast depreciating cars will have lower residual value and the monthly lease payments should be higher to absorb the higher depreciation value during the course of the lease. So these choices can be solely a preference but there is an economic dimension. My bias is that i prefer getting the best car for the least amount of Cash outflow on the long term at the expense of the short term low cash outflow. I'm like the type who can delay the reward for long term benefits like in the "Marshmallow experiment". Thanks for reading this far. GREAT JOB on your channel. Normand from Montreal, Canada

[@jl4091]

380x36=13680 out of pocket.Your paying 4560 every year,+insurance and plates to RENT a Mini.That's nuts sir.

[@scottr2706]

Clearly you do not understand the reality of leasing.

[@jl4091]

@@scottr2706 Wrong.I think you're the confused one.

[@CarEdge]

JL, it cost you more than that in depreciation on an annual basis when you buy a car. For many people, such as myself, I like driving a new car every three years that is under warranty which limits my exposure to major repairs. Leasing isn't for everyone but if you anticipate wanting a new car frequently and always having a car payment than leasing is the way to go since it allows you to get more car for the money. Stay safe and thanks for watching, Ray

[@user-lc7zt8sk6i]

@@CarEdge Great insightful and respectful response!

[@TheGecko213]

And if you own a business then the lease payment is tax deductible if you use the car for business .

[@pjasyl]

This video is most help full in answering my questions on leasing vs. purchase! I have always financed a vehicle. Now retired in my late 60's I no longer wish to purchase due to my age. The question I have is am I too old to get a lease? A reply will be appreciated.

[@CarEdge]

No, you are not too old for a lease. I had customers who were leasing cars in their 80's. You just need a good credit history and enough retirement income to show that you have the ability to make the payments. Take care, Ray

[@pjasyl]

@@CarEdge Thanks for reply I appreciate it! It's a burden lifted off my shoulders. Yes I have a good credit history,& enough retirement income with the ability for payments.

[@mattyounis5636]

Sounds more like a fleece

[@bradb3248]

Dave Ramsey listener?

[@mattyounis5636]

@@bradb3248 lol yep

[@toddsmith1617]

That is the only way I would do it unless you buy a Honda or Toyota. I got a 2010 honda civic with 140000 miles the only money I have spent on the car is oil change, automatic trans change, tires and new headlights ($150.00). Install took about an hour on the headlights. Drop my loan payments 5 years ago.

[@sameoldeh]

@Todd Smith Well thought out.

[@JohnnyTalia]

So let's see...pay $X,000 up front, plus $X00 a month for 36 months, then after three years pay even more to turn it in? And after shelling out a total of $15-16K over three years, you end up owning NOTHING? Sounds like a great plan! Not to mention freaking out every time there's a scratch or a ding (OMG, is that excess wear-and-tear?), willingly being enslaved to the dealer for maintenance, and parking the car for a few days each month so you don't go over the allowed mileage. Brilliant!

[@The_Temple]

the last time I purchased a new vehicle was in 2009, a Ford Ranger, and paid off the note in 2012 - still have the Ranger & plan on keeping at the very least another full decade leasing makes NO sense for me -- and most likely my next will be paid for cash on the barrelhead

[@shmehfleh3115]

Leasing only makes financial sense if you know for a fact you're not going to need that car at the end of the lease, and how many of us will ever be in that position? Otherwise, leasing a car is purely a vanity move: You do it because you want to drive a more expensive car than you could otherwise afford, or you like changing cars every three years. Those aren't necessarily bad reasons, but let's not pretend they make good financial sense. You're still eating the car's depreciation in the form of leasing fees, and you're also paying a lot more for the "peace of mind" of a car that's always under warranty than you'd ever be likely to pay in repairs. The odds of anything going seriously wrong on a brand-new car inside its warranty period are are pretty slim, unless you really beat on it. And if you do, and you're leasing it, you're gonna pay extra when it comes time to return it anyway. My car, a 2011 WRX that I bought new, has only been in the shop once to correct a problem out of warranty. It cost me $1200. Had I kept leasing new WRXs every three years, I would've blown through that $1200 in three or four months, and I would've kept paying more & more money.

[@Benjamin-gp3dl]

I’m definitely doing a lease this time around although a used is tempting but not highly practical or advisable in my mind.

[@chairde]

I lease because it puts me in a new car. I always stay under ten thousand miles per year. If you drive a lot it costs a lot in a lease.

[@TheGecko213]

If you drive a lot more then 10-12k miles a year then keep a second clunker to take the overflow mileage 😀

[@markthern]

Do more live stuff - your Dad has WAY more personality on the live shots

[@lovecapitalismnosocialism1580]

Leasing is a great way to never get stuck with a pile of junk worth less then you own it for not too mention never getting stuck with a 3000’repair out of warranty every year

[@rj.parker]

Now we know why people lease, often they are low mileage drivers that really want a new warranted car every three years and don't mind paying what it takes to do so. Now we need a good numerical comparison buy vs lease for a couple of mileage scenarios. Maybe a "start with the end in mind" bottom line view followed by how to calculate at a high level. Another set of scenarios might be full purchase price tax states vs monthly payment tax. Finally income tax considerations for entities vs individuals.

[@Blehza]

Please keep that intro for all of your future videos...

[@SStesta90]

3 years listening to dave ramsey, this feels wrong...

[@joed5419]

Ramsey's a TRUMP clown... he probably says the earth is flat too.

[@evanwindom3265]

@@joed5419 Ramsey has been saying the same things and advocating the same techniques for 25 years. How does that make him a "Trump clown"?

[@814chappy]

@@evanwindom3265 sounds like Joe D has trump derangement syndrome don’t mind him

[@allenpaul102]

Brainwashing will do that to you.

[@brianrichards7006]

There is also a company called swapalease, where you can take over a lease from a private party. I don't know if it's advantageous or not but maybe you only want to lease for a year or two, that might be the way to go. Do your due diligence.

[@ervlichterman4714]

The only advantage is when the residual is bought up or the interest rate is bought down by the manufacturer or like in your case, your lease is not based on MSRP..

[@HR-wd6cw]

99% of the time, leases for personal use are pointless and a huge waste of money. The only time I would maybe recommend a lease is if you're the type that likes to get new cars every 2-3 years. Then it may be cheaper in the long run than buying a car, having it lose 30% of its value within the first 1-2 years, and then trade it in. The second scenario would be if you want a high-end car like a Land Rover or Audi. In the long run ,it may be cheaper to lease it but only through the warranty period. That way you know how much you're spending on the car and aren't surprised by massive car repair bills. But for your average family sedan, mini van, or other personal vehicle, leases should be avoided. Many times people get dinged for things like small damage (dents, dings, scratches) excessive mileage, etc. And sometimes they "Trap" you into leasing saying stuff like "they'll waive the fees if you lease another car". No you pay for it in the end. For most personal vehicles, you're better off just buying one. At least after the payments are all said and done, you have someting to show for your money spent. Of course it won't represent all the money you spent, but you'll actually have something tangible in the end. I did the math on my most recent purchase, and to lease, would have cost me about the same (maybe $50 less per month) over the first 36 months. I'd rather just own the car in the end (ie. finance/purchase it) for an extra $50 per month for 36 months. For a business, it's a bit different because businesses can write off some leases as expenses and get a tax benefit (reduction) from it, so from a business standpoint, a car lease may make a little more sense, but hardly ever does for individuals. Even if you're an exchange student that will be in the country for say 3-4 years, you're better off just buying a cheap $3000-$5000 car (which you can find decent used Japaneses cars that are reliable for that price) because you'll pay more for a leased car over 3 years if you lease.

[@andreagardner6639]

I am cracking up at your "Murland". You are my people!!!!!