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Originally Posted by bmussatti
Uhm, are you serious? Where is the "financial sense" in buying a new (or leasing) car every 3 years? There are more important things than cars; like education (yours or your children's), retirement savings, a debt-free lifestyle (pay off your mortgage if you own a home)...just to name a few.
Your second point is what I have always suspected of people who leased cars. I say if you can't afford it, don't buy/lease it.
I also don't subscribe to this whole notion that cars "depreciate". I think more in terms that I "consume" the car vs it depreciates. The car provides a value; enjoyment, transportation, therapy, exhilaration, status...whatever is of value to you. So, therefore the car will become worth less, because I have consumed part of the value. Not that it depreciated. Depreciation sounds like a loss in value without benefit. Consuming implies a receipt of some benefit and value. But this is really semantics.
I paid cash for my car 3 years ago. Would have never bought it if I needed a loan. It is a toy. Don't need it. Nobody really needs a Porsche. I just wanted it. I don't care what it's worth, I am not selling, and may never sell it. Sure, it's worth less than I paid for it, but I have consumed a ton of fun & enjoyment from it. So we are even.  |
Of course all of the things in your first paragraph are nice, but what makes you think I am not doing all of that? In fact, thats why I cant afford to buy it outright - because thats where my money is going.
You can call it "consumption," but the fact is that if someone like me buys a car and then sells it after 3 years, they will take a huge loss. I dont keep cars more than 2-3 years because I am a true enthusiast and like to enjoy as many cars as possible in my short time here on earth.
So, if I assume that I will be paying X amount per year on a car, what does it matter if I am leasing it or buying it when the actually loss is virtually the same. Someone like me who chews through cars never has equity.
I guess what I'm saying is that you can either pay down your depreciation (ahem, consumption) or the financial lender. Isn't that, in the end, the same thing? You're throwing money out the window, just like me. Of course, if you're going to keep the car more than 3-4 years, leasing obviously turns into a worse proposition, but again, thats not my goal.
So if I can accept that I will pay $400 each month for a car that I really enjoy, (and I do) whats wrong with leasing over and over? Oh, and your comment about not doing it unless I can afford it.. well, I CAN afford it, if I lease.
So, ANYWAY, back to the original question.. anyone know?