#1068² ENTREPRENEURSHIP & BUSINESS² – S5 E6 – BUYING OR LEASING?

After I have owned my very first car for over 8 years until it died, my second and current car is a leasing deal. But which type makes more sense? Which is the way to go?

Comparing buying and leasing is a difficult challenge. Why? Because you pay for two different things. Buying means owning a car. You do not only pay for the car, but also for all the broken parts, for maintenance and so on. The moment you lease a car, the car doesn’t belong to you. Instead you are paying for the use of the car. Maintenance can be included into the deal, the cars are usually brand new and there is not much going wrong and of course after the time period you have chosen before, the car gets back to the dealership and you do not have to sell anything yourself.

Photo by Sourav Mishra on Pexels.com

So far so good. But over time leasing can never be as cheap as owning a car, right? It depends. Generally speaking I can agree, but we have to look at the big picture.

With the current car market prices crashing through the roof, buying a car can get pretty expensive. But once you own it it will keep its value, right? Not necessarily. With the change to electric cars in the industry, nobody can really predict how the future car market will look like. And so, owning as well as leasing a car have their advantages and disadvantages. For my current car I used the government support which allowed my dealership to make a pretty good deal. With the running costs and insurance being so much lower than my old car before, the leasing car is not really much more expensive than driving the old car I did before. And of course I am sitting in a brand new car with all the features you need.

But there is at least one catch, isn’t it? Exactly, it’s the distance you have to drive in a year. As long as you do not drive too far, leasing can be an attractive alternative, but once your yearly km’s go through the roof, the leasing gets expensive as well, which makes it more attractive to buy a good car and drive thousands of miles with it.

At the end of the day there is not only one way how to do things. You have to compare the current car market with your personal needs and take a decision based on your current lifestyle. And therefore I for my part have to currently think about my next move. Will I get a leasing car again or will I buy something? Sure, I have still one and a half years left, but the market is tricky these days, believe me and the times are changing so quickly.

See you next time!

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