Labor Day is coming up, and while to many people this means barbecues and
back-to-school, you've probably also heard your fair share of weekend-long sale
events at car dealerships. It's long been considered one of the best times
of the year to buy a car, but the deals aren't just for buying. In fact,
most dealerships put plenty of emphasis on lease deals this time of year as
well. Of course, the power of choice always raises the question: which is
better? It depends heavily on what type of consumer you are.
Fickle buyers: take advantage of those sign and
drive lease deals! Leasing is the ideal decision for anyone who
doesn't think they'll want to keep a vehicle for the long haul. It's more
economical than driving a new car off the lot then attempting to sell it only a
few years later. The car will have depreciated in value greatly by then and
you'll probably be eating several thousand dollars.
Getting a great lease deal does require doing your homework and
understanding how leasing works. The basic principle is that your payments are
calculated by determining the difference between the capitalized cost – which
is the car's selling price – and the residual value – which is the anticipated
value that the vehicle will hold at the end of the lease. Essentially, when
you're leasing a car, you're only paying the cost of its value depreciation
over time. Know these terms before you go to be able to have the most
informative talk with your car dealer and decide if the payments and contract
seem to fit your lifestyle. Around Labor Day, many dealerships have the
aforementioned "Sign and Drive" deals which require no money down,
and they often flaunt much lower payments. If you plan on leasing, it's a great
time of year to take advantage of that.
However, if you think you're going to end up buying the car after your
lease is up, it's in your best interest to buy up front. It's been said that
buying a brand new car and keeping it until it's monetarily not worth keeping
anymore due to value depreciation and mechanical issues is the best financial
route to take. Of course, unlike leasing, this doesn't take into consideration
the fact that you might not want to keep the same car for its entire life, so
take that into consideration. You can get some great deals on brand new cars
around Labor Day, but be sure to do your research first if you're actually
committing to purchasing it – vehicles are, of course, a big commitment of a
purchase.
Both buying and leasing are attractive options depending on what you're
looking for. Leasing is definitely a great short-term option, especially if you
get a Labor Day deal. Buying, however, can be more economical for someone who
plans to keep the car for the next decade or so.
Labels: sign and drive lease deals