Let’s look at a new car purchase under $35,000
Unlike the previous scenario we are going to put down $4,500.00 when we purchase or lease and have choosen a financing term of 4 years. Again, the finance payment is higher when compared to the lease payment, however at the end of the 4 years – you own the car! If you plan on keeping the vehicle for many years, let’s say 10-12 years – the vehicle purchase works out to a cost of less than $2,900 per year.
As before we still would recommend financing/ownership over a car lease. The savings realized every year after the 4 year financing term is still parmount to keeping interest costs down and ensuring long term savings. Perhaps considering an extended warranty on the vehicle would also be beneficial to ensure maintenance and repairs are kept in check as the car gets older.
$33,000 Car Purchase/Lease ($4,500 Deposit)
LEASING: (like renting-you do not own the vehicle)
* Mileage package effects your lease payment: 12 KM, 16 KM or 20 KM per year. We chose 16 KM/year.
$33,086 Lease Amount, ($29,260 Vehicle + Freight/PDI + Taxes and Licensing)
$370.58 per month, Four year lease at 2.99%
$17,788 TOTAL PAID OVER 4 YRS, Options: Turn in Vehicle and pay closing fees, (approx.$1,500) or Buy-out Lease
*If you plan to do this again with another lease, the cost of leasing over 12 years = $71,364 or $5,947/year.
*If you wanted to purchase the vehicle at the end of the lease, you would pay more than the finance option.
$34,770 TOTAL COST WITH BUYOUT AT END OF LEASE, (Buyout amount = $12,482 + $4,500 original deposit)
$33,086 Finance Amount, ($29,260 + Freight/PDI + Taxes and Licensing)
$617.61 per month, 4 year at 1.99%
$29,645 TOTAL PAID OVER 4 YEARS – YOU OWN VEHICLE
*If you plan to keep this vehicle for 10-12 years, the cost per year drops to $2,845/year to own your car.