Leasing vs Buying a Car: Which is ACTUALLY Cheaper in 2024?

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Leasing vs Buying a Car: Which is ACTUALLY Cheaper? We discuss this in today's video with a full scenario based on a Rav 4 Hybrid. We also talk about who buying a car is better for, versus who leasing a car is better for. Please note around 6:40 I do say the number "11,595", but that is ME not reading the number correctly, the text on screen is correct (11,195). If you enjoy this type of content, make sure to SubbbbbBSCRIBE!!!
Timestamps:
0:00 - Start Here
0:45 - Leasing
4:02 - Buying
7:06 - Comparing Apples to Apples
8:00 - Returning the Car Scenario
11:15 - When to Lease vs Buy
13:05 - When Buying is Better
13:28 - Who Leasing Is Good For
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Опубликовано:

19 июн 2024

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Комментарии : 765

@humphrey 6 месяцев назад

Would you rather lease or buy? Drop a comment!

@sai-pc5fl 6 месяцев назад

lease because I like the idea of upgrading every so often and having complimentary maintenance. It also opens up more decisions on which car to choose since Im not having to worry about long-term reliability

@LtMadWolf 6 месяцев назад

I leased my 22 Tacoma sr5. I really love the truck plan on saving the money and buying it out. The beauty of leasing is you can try and talk down buy price before you sign the lease. I personally leased because the interest rates are way to high on cars right now. there at like 12-16% in Arizona.

@brocksolomon8953 6 месяцев назад

Buying a couple year old used car is the way to go. Anything else and you're throwing money away

@triple_gem_shining 6 месяцев назад

@@brocksolomon8953but then you can't look cool to all your friends who don't like you 😎 Jk

@brocksolomon8953 6 месяцев назад

@@triple_gem_shining 😂

@TuBui2 6 месяцев назад

Adulting is realizing that the 6-figure job you dreamed about can only afford a new, mid-range toyota or honda

@humphrey 6 месяцев назад

lmao seriously

@brocksolomon8953 6 месяцев назад

No adulting is realizing that buying a new car is stupid

@TuBui2 6 месяцев назад

@@brocksolomon8953 amen

@etvow 6 месяцев назад

@@brocksolomon8953 No. Adulting is realizing that Toyota dealers are able to sell their Certified Used cars for $10K above the MSRP of a new one just because people like you are always recommending used cars.

@brocksolomon8953 6 месяцев назад

@@etvow yeah I never said buy from a dealership.

@NimaOmaisj 12 дней назад

BRICS seeks to create a new currency, considering gold's historical role as a store of value and medium of exchange. However, the functionality and acceptance of a gold-backed currency in the current global financial system are uncertain. Creating a new currency requires careful consideration of economic, political, and logistical factors.

@ArturoM.Dykstra-55 12 дней назад

The discussions and proposals surrounding BRICS nations' potential use of gold are intriguing. People choose to buy gold for various reasons, such as its historical role as a store of value and medium of exchange, its potential as a hedge against inflation or currency devaluation, and its relative scarcity compared to other commodities. Gold also offers diversification benefits to investment portfolios due to its low correlation with stocks and bonds.

@WeweAke 12 дней назад

It simply means the allocation of money toward an asset or portfolio, with the expectation of earning a return over time.

@RebeccaGilpin 12 дней назад

Yes, It a procedure where you allocate money or capital towards buying financial products, expecting to earn a considerable return in the future.

@FrankBrook-js9yh 12 дней назад

According to Patricia strain an expert, this can occur through appreciation in the price of the asset, earning interest, dividends or royalties.

@ChristopherHandley-ek4ul 12 дней назад

I agree with you. I started out with investing on my own, but I lost a lot of money. I was able to pull out about $200k after the 2020 crash I invested the money using an analyst, and in seven months, I raked in almost $673,000

@chuckz28 6 месяцев назад

I think a factor that was missed for all of the lease situations was during the "buy the car after the lease is up" the 21k is shown as basically a cash payment when most people will have to take another loan for the purchase so the interest on that 21k loan will make the total ownership cost even more post lease.

@sweetpickleinc 6 месяцев назад

This! Big oversight. Also, “older” cars typically have higher interest rates as risk mitigation for banks. I’m guessing if you just had a chunk of cash (say, $21k) laying around, you would’ve purchased a used car outright in the first place (current used car market aside).

@pauljiltsov9950 6 месяцев назад

Right on point, I was about to mention this myself. That's the reason why people don't buy out their cars after their lease. It is very hard to fork over 21k in one payment if you have been driving the car for three years already. And, that's if you have the money for it. Lease is just lease. Three years and then move on to the new car. You will always be driving the newest model and won't have to worry a out breakdowns.

@vladnegin5918 6 месяцев назад

Yes, also In most cases you will need to go through a certification inspection, and that means you might have additional costs on top of that

@Steve_in_NJ 5 месяцев назад

I did the math and doing a lease buy-out this year would mean I spent $12,000 more if I keep my Hyundai Kona. It's just cheaper to lease a newer Kona. I would need to take out another loan -- a used car loan -- if I was to keep my current 2022 Kona, and interest rates are higher for used car loans than new loans.

@LawnFlex 4 месяца назад

100%. Glad this was one of the first comments I saw cuz this was totally overlooked.

@Baldwin321 20 дней назад

Rate cuts commence in June 2024, taking 6-8 months to complete. A potential crash, if any, might occur by March 2025. The soft landing narrative is gaining traction, making this big recession everyone is calling for less likely. With $1 million from a business sale, I'm seeking profitable investment opportunities for the next 3 years.

@Scarlett34568 20 дней назад

The financial market is a reliable choice. Diversify your portfolio with I-bonds, stocks (ETFs, REITs, dividend-paying stocks), and bitcoin. Given your budget, I recommend hiring a fiduciary to ensure you receive professional insights for a fee.

@Alden457 20 дней назад

Due to my demanding job, I lack the time to thoroughly assess my investments and analyze individual stocks. Consequently, for the past seven years, I have enlisted the services of a fiduciary who actively manages my portfolio to adapt to the current market conditions. This strategy has allowed me to navigate the financial landscape successfully, making informed decisions on when to buy and sell. Perhaps you should consider a similar approach.

@Annie56427 20 дней назад

this is definitely considerable! think you could suggest any professional/advisors i can get on the phone with? i'm in dire need of proper portfolio allocation

@Alden457 20 дней назад

@@Annie56427 When ‘Marisa Michelle Litwinsky’ is trading, there's no nonsense and no excuses. She wins the trade and you win. Take the loss, I promise she'll take one with you.

@Annie56427 20 дней назад

She appears to be well-educated and well-read. I ran an online search on her name and came across her website; thank you for sharing.

@matw1x 6 месяцев назад

Best comparison & breakdown I've seen so far. Thank you brotha.

@jimv77 6 месяцев назад

I was stupid when I was 24 years young and bought a brand new 2001 Toyota Tundra for $30,000 cash……should have bought used…..I just finished college and deserved it was my reasoning……but I guess the good part is I still have it 22 years later and it runs just fine……

@jerrylundegaard2592 3 месяца назад

If you have driven that Tundra for 22 years, paying $30K when you bought it was smart.

@objc 3 месяца назад

Lucky, I had a 2000 Tundra I paid cash for and it developed a number of expensive problems after 10 years. Traded it for a small Honda, far cheaper to drive.

@sethtenrec 2 месяца назад

I bought a 2001 tundra new, it was an advertised special base model about $21,000. Still have it 23 years later.

@dianagregory9721 2 месяца назад

No that wasn't dumb because you kept that vehicle for many years and got to experience buying a brand new car. I don't think it's a waste buying a new car if you plan on keeping it for a long time. You certainly have gotten yr monies worth.

@forte7991 2 месяца назад

For cash.. wow

@randxalthor 6 месяцев назад

One small detail that might be worth highlighting the next time is that most people will have to finance the residual value at the end of the lease in some way, as they don't have $20k+ laying around. That would add interest to the lease cost to own.

@HarfelJ 6 месяцев назад

That's what I was thinking. Later in the video, he says that paying in full at the end of the lease is the general expectation. That doesn't make sense for the dealer or for the buyer. Whether you pay from your wallet or a bank gives you a loan, money is money, and the dealer will probably be happy to take it 😶

@hannahtate923 6 месяцев назад

You don't have to finance anything - you just trade in the car and get a new lease

@2004cyrus 5 месяцев назад

@@hannahtate923lmao wrong! When you lease cars, you pay a money factor (a lease interest rate). Your comment is mind boggling.

@hannahtate923 5 месяцев назад

@2004cyrus uhhh, I was responding to the specific comment above. I know you pay an interest rate to lease. The comment was that you have to finance the residual amount of a lease at lease end and that most people don't have 20k lying around. And you don't need to. You can just turn one leased car in and get a new lease. You don't need to buy out the car at lease end. In fact, we even sold a leased car back to the dealer 2.5 years ago - as in, they gave us money to give back a leased car that we didn't actually own, and we didn't have to buy it first. They just gave us the money. In summary, you DO NOT have to buy out a leased car at lease end. You DO NOT have to pay the residual value. And you DO NOT have to finance the residual value if you don't have the money at lease end. You can simply walk away or start a new lease instead.

@2004cyrus 5 месяцев назад

@@hannahtate923 correct. I’m in the car industry- my family owns a bunch of franchise dealers in Florida, Texas, Missouri and a few other places. That’s the only reason I mentioned the money factor. Congrats on getting a dealer to give you money for nothing in return. That’s highly unusual and they won’t be in business for long,

@somehandle215 6 месяцев назад

I work in a tech job, most of us drive old beaters, and it makes me proud. One guy even has a late 1990’s Civic and I’m slightly jealous, in a competitively frugal way. A paid off car is the only car I’ll ever own, I learned that after the payments were done on my first car loan.

@jackz4149 6 месяцев назад

My car is paid off but I need to trade in within 5 years timeframe, otherwise I’m sure the repair cost will be high

@wjm3018 2 месяца назад

@jackz4149 it won't u less you can fix your own car or if you have a honest mechanic. This will still save you alot vs paying monthly car pmts. Dealership mechanics rip you off

@nfzeta128 2 месяца назад

@@wjm3018That's true that they rip you off but some of that is reliability cost because finding a good mechanic otherwise is like thrift shopping.

@youzongliu Месяц назад

Why?

@DakotaRowehl Месяц назад

Newer cars cost so much to repair. I'd be scared of driving anything out of warranty at this point. I had a Nissan CVT blow up at 40k miles. I've just chosen not to have a car after my sentra was totaled by someone on their phone.

@consumerdebtchitchat 4 месяца назад

From the ages of 16 to 50 I always bought used cars that were about 5 years. After dealing with leaking oil in the driveway. One vehicle needed a total transmission overhaul and it never ran the same way after a 5k repair. I have never believed repair shops are very honest. They can always find something additional to miraculously find wrong. At age 50 I decided to lease. ALL of those problems above have been solved 😂😂. I no longer need to keep a car repair maintenance account. Bumper to bumper warranty 36,000 miles. I get the lease damage waiver which few people seem to know about. I get a new vehicle every 3 years. My second lease ends this year and I could buy out my Toyota Corolla for 16k. I hold an 812 credit score and have all the access I need to zero interest loans. It would take me 10 months to pay it off. But I'm going to go back to leasing my third car because quite frankly it's a luxury I'm willing to pay for. The peace of mind is unreal.

@sadpisces2345 20 дней назад

Do you have to pay a deposit every time you renew a lease?

@user-vw1cv9qr4c 20 дней назад

@@sadpisces2345 you can if you want to to drop the monthly payment down even further, however you won’t get that money back

@jochuba 4 месяца назад

That is the most intelligent video that tackles the question of buy vs lease. Thank you.

@DrGeneralkumar82 Месяц назад

One big reason why I lease is opportunity costs. I'd rather pay lower monthly payments for a better car, and not tie up my capital in a loan. Id make more money in the long run investing the difference.

@scooterjsl 7 дней назад

this. I have $28,000-29,000 in my stock portfolio, and 20,000 ready in cash. plus the value of my trade-in. By using the lease I can fund the monthly payments with my cash. Then allow 3 years of potential returns on my market portfolio. Also with EVs I'm getting a $7500 bonus cash due to the tax credit.

@Loveless100 6 месяцев назад

Another pro for leasing: if you’re on a work assignment in a different town for a set period of time, it could make it easier when your assignment ends to simply return the car rather than find a buyer. Oddly specific, but pretty common in certain industries. Great video as always!

@MarkM58 Месяц назад

military!

@CrushDani Месяц назад

You could probably just sell it back to the dealer and still break better

@meaty4562 Месяц назад

@@MarkM58 YES!

@Ubiquitous_1 6 месяцев назад

I love these comparison videos. Seeing the numbers really gives the proper perspective for the big picture. I want to drive my car for 30 years, that may not be realistic but that's what I'm shooting for.

@sethtenrec 3 месяца назад

I’m into year 23 for my Toyota Tundra (if I was doing this today it would be a 4Runner, check CR reliability survey) Buy a quality vehicle and take good care of it.

@amirr566 6 месяцев назад

that was one of the best videos that clarify which one is more reasonable . thanks Humphery

@humphrey 6 месяцев назад

Glad it was helpful!

@RebeccaMartinWatson День назад

*“I Got Rich Doing This”*

@RebeccaMartinWatson День назад

The first step to attaining wealth is figuring out your goaIs and risk toIerance - either on your own or with the heIp of a financiaI pIanner, and foIIowing through with an inteIIigent pIan, you wiII gain financiaI growth over the years and enjoy the benefits of managing your money.

@RebeccaMartinWatson День назад

I am fortunate I made productive decisions that changed my finances (gathered over 1M in 2years) through my financiaI planner. Got my 2nd house in Feb, and hoping to retire soon. Give this a try and attain good-returns.

@RebeccaMartinWatson День назад

Give this a try and attain weaIth. Get to her

@RebeccaMartinWatson День назад

Elizabeth Green Hunts

@Albert-777 3 месяца назад

To each his/her own,different situations for different people.Appreciate the education 🙏🏼👍🏼

@michaelraju6102 2 месяца назад

Awesome video, learned a lot. Thank you!!

@mikezerker6925 6 месяцев назад

I beat all of these options by buying a used car that’s around 3 yrs old (time frame when depreciation is the steepest), paying cash (with a max limit of $35k) and keeping them for around 10 years depending on maintenance and issues. I try to buy Honda/Toyota since they are always on top of the reliability list - meaning $avings in maintenance costs over the years, and they usually last 10-15 yrs!

@DHFlip18 6 месяцев назад

I have a Honda, Toyota and a Ford econoline... buy used, pay cash, take your time inspecting the car and stay current with maintenance.

@booksfellover 6 месяцев назад

This is the correct answer

@jrroelle 6 месяцев назад

Except 3 year old Toyotas are only a few thousand cheaper than brand new. The used market is horrible right now.

@mikezerker6925 6 месяцев назад

@@jrroelle Just wait a bit… I bought my 3 yr old Lexus (used) in 2021 for $28k… new, it was around $54k

@sunshadow9704 5 месяцев назад

But neither of those vehicles offer joy of a drive. They are boring boxes on the wheels. With outdated technology and subpar driving characteristics.

@darksplash2191 3 месяца назад

So far the best video on leasing vs financing a vehicle but i still think there are several important things to keep in mind to be able to determine the true cost for each one. What is the average number of years a person keeps their financed vehicle, how many cars on average do people finance in their lifetime, average maintenance costs for total cars owned in a lifetime, and this doesnt even account for car crashes or how safe cars are after 10 or 20 years.

@introspectivepiura6103 4 месяца назад

This was so helpful thank you so much

@kevinhuerta-ponce138 3 месяца назад

I’ve leased two cars and bought 2. Leasing is way better if you don’t drive a ton. The cars i have owned have caused me so many headaches. Aside from the price you have to remember that when it’s your car it’s your problem Time at the mechanic,missed days of work, cars won’t start before heading to work. It sucks. Leasing is just easier. It’s cheaper, everything is under warranty and if you really like your car after it’s done you can just buy it( but you won’t bc you’re tired of it). Is insurance higher yeah a little bit but good luck not having good insurance coverage. Your 10k policy limit won’t even cover a paint job. If you don’t like to be inconvenienced just lease it.

@troyisaac3611 Месяц назад

Thank you for your comment

@Redline.Junkies 3 месяца назад

Amazing video. Thank you for this

@resiliencyisrough 6 месяцев назад

I’ve learned so much from you and would never unsubscribe! I appreciate your videos so much and when people ask me about financial topics I send them to your channel.

@humphrey 6 месяцев назад

I'm so glad!

@kittmarie8285 21 день назад

Thanks so much' that was very helpful and timely for me. :)

@SunnyBoys2 Месяц назад

super insightful, thanksfor the tips!

@salrecinos6922 6 месяцев назад

Very Helpful, thanks!

@diganto1987 5 месяцев назад

For international workers in USA, leasing a car makes more sense if they do not have the visibility of their employment. This was the case with me. In 2019 Nov (just before covid) I ended up leasing a car, and at the end of 3 year lease, I had the assurance of my employment and ended up buying my car. At that time, residual value of my car was 16k but the used car value in market was more than what a new year was in 2019.

@today75b День назад

Thank you! At about the 3 minute mark, I got out my calculator to double check the math. When I read $14…. and I heard $17… I felt inspired to try out this mathematical blueprint. This is a great channel!

@alexandervalladares2501 18 дней назад

This is an amazing video … Thank you very much

@mahalakshmi9898 4 месяца назад

Excellent video🎉 👏Actually we r in a confusion whether to lease or buy a car...... Your explanation gave a perfect clarification for us... Thanks a lot...

@sandeepd2939 2 месяца назад

So what did you decide? Buy or lease?

@jask320 3 месяца назад

Very good comparison 👏

@kappatvating 12 дней назад

New subscriber alert. Because you asked and this was so detailed

@suzil5504 4 месяца назад

Fantastic video!

@robertk2530 6 месяцев назад

I lease a 2019 Rav4 XLE AWD and my lease 370 a month for 3 years with ZERO down. Toward the end of the lease I called toyota and extended the lease another year and paid 400 a month for another year. My buyout was $16900 and financed it til I could find a car I wanted without time constraints. Traded it in for $24000 and received a check for over 6k (equity) for a down payment on my new car. Sticker on my Rav4 was 32k back then and I am not really going to be a bean counter on this, but I basically paid 200 a month for fairly well equiped car and my only maintenance was a couple oil changes (Toyota has 25k free maintenance). The point is there is a sweet spot to lease a car with high resale and keep til you get the most bang for your buck before tires and brakes are needed.

@Dannycristofaro 5 месяцев назад

This is basically EXACTLY what I'm potentially looking to do with a new 2024 Rav4 XLE Hybrid in the next month or so, so this was a super helpful comment! Thanks for sharing!

@sunitjoshi3573 4 месяца назад

@@DannycristofaroSo are you going to lease then buy it at end?

@FLEXNIVORE 3 месяца назад

I can see this situation working out the way it did because of where the market is. But it isn’t necessarily going to remain the same, so still no guarantees. Glad it worked out for you tho! 🙌🏾

@sergeydudukin4214 20 дней назад

I paid 22k cash in 2020 for 2018 Lexus ES350 Ultra Luxury with 55k miles on it. I was offered same money for trading it in in 2023. But that is once in a life time situation just because of price surge.

@xWiiLLz 6 месяцев назад

Quite happy I leased my GTI 2021 at 1.9%😂 There's also a 10k$CAD difference in market resale value and buy back cost which I'm looking forward to in the next few months

@VitaMiata 3 месяца назад

was considering leasing a model y. however, the used car market has somewhat promising resell value. therefore, i'm gonna buy. thanks for proofing my point. great math course!

@trina2366 3 месяца назад

This was supppper helpful and I know where I stand in this market❤

@davidfontenelle80 6 месяцев назад

Looking forward to the series.

@cbohorquez82 6 месяцев назад

Great video Humphrey! In my opinion, if the asset appreciates, one buys; but if it depreciates, one rents the asset. Perhaps, another way would be owning a car with classic plates, which it does appreciates over time. Now, its maintenance cost could increase over time too. The important thing is to have options, right!

@TubeVab 4 месяца назад

Very good review with data

@subinrevi2268 3 месяца назад

Pretty useful video 👍🏻

@yooo692 11 дней назад

Very helpful! Thank you!😊

@ElisabethLynn 6 месяцев назад

I owned a few junkers and always had surprise maintenance bills and it was less expensive and less stressful to lease a brand-new car and I miss leasing. 😢

@rileybimm6950 Месяц назад

This! The mental freedom and lack of stress

@bhavishyachandra 6 месяцев назад

Great video, one minor correction: You can indeed trade in a lease or transfer it to someone else, Most dealers will pay off the lease and you only owe the difference amount between your remaining residual and current value. If you lease a car like an M3 or a 911 or a Civic, you can probably walk away from a lease without owing anything

@etsoccer91 5 месяцев назад

I’d also say that, for example me, I have calculated a monthly allowance for car payment that I am okay with. I don’t care if I pay for a car. I like getting new cars every 3 years and everytime I need to look for a new car I take my current lease and get a quote from car max. 5 cars in a row have had at least 4-7k offered over residual value left in the lease. I take that quote to dealership and say I’ll take a new car from you if you match car max offer. I’ve never had to put down more money in 15 years for a new car. Just my experience.

@snaps133 6 месяцев назад

Great video and explanation

@humphrey 6 месяцев назад

Glad you liked it!

@ziurziur1ify 4 месяца назад

Thank you for the video, really enjoyed it...Can you make a video that talks about if it's better to drive a car until the wheels fall off, maybe 15-20 years, or sell the car at some point before it stops working, what would save more money in the long run ?

@yolandaosborne1848 2 месяца назад

Extremely helpful. New subbie 😊

@YODAddyLIVE 6 месяцев назад

There is one major financial part you missed with the current state of EV/PHEV/Hybrid tax incentives. Most no longer qualify for the incentives when purchasing but do when leasing. This can add a huge savings to leasing. Could even be a better incentive to lease then purchase once lease is over or simply lease and move on and let someone else deal with the batteries a few years later.

@sithlordmaster181 3 месяца назад

The $7500 doesn’t go to the customer it goes to the company leasing out the vehicle

@marcburrows5783 Месяц назад

man great video. got my sub

@jeanneroy1494 2 месяца назад

I agree. Very good video. I’d probably buy.

@aidanlueth5372 4 месяца назад

Thank you for this, I am a first time car buyer and didn't know the true comparison between buying vs. leasing... but this cleared it up for me, the numbers don't lie and I am going to be buying a car, not leasing. Thank you!

@atetster 4 месяца назад

He missed a lot of info comparing. Please check other sources.

@gamesguy 4 месяца назад

He presented a very shallow surface level analysis. In reality leasing is often cheaper depending on OEM incentives. Right now many OEMs are offering leases with roughly 2.5% APR loans, where do you get that number financing a car? Residual values are not set in stone like he's presenting either. OEMs often subvent the lease and set them too high, which reduces the cost of leasing even further. And then there are the EV tax incentives available to leasing but not buying. He's missed a ton of stuff.

@dawannwilliams6301 2 месяца назад

Thank you your video is SPOT ON . I have a reliable 2013 Nissan Altima. I had a 2016 Porsche Cayenne that was recently totaled 😢. I am considering a Mazda CX90. I really want to lease a Range Rover Velar. They are really cheap used like 1/2 price after 4 years but they are known for problems and expense. A 3 year lease without having to worry about maintenance and then returning it works for me just for the experience. The Mazda will always be there and in my price range.

@aleashamason8497 5 месяцев назад

Well done! You walked through every possible scenario, I appreciate it! 🎉

@foreverDharma 4 месяца назад

Thanks for the video. If you could do one for the Australian scenario, it would be very helpful for Ozzie's.

@SnakeAndTurtleQigong 11 дней назад

Thanks very much!

@foreverDharma 4 месяца назад

Awesome comparison and you have covered all aspects. But one thing is unclear whether you have considered the maintenance costs such as fuel, service, tyres, insurance and annual registration in buying the car scenario. I assume all the above are covered in leasing scenario.

@tombrooks2215 3 месяца назад

Great video Humphrey. Very informative. One thing that you didn't mention about returning a leased vehicle after the term limit beside mileage, was damage. In the 'small print' of all lease agreements is damages will reduce the value. The value placed on a returned lease, is that it has to be in same condition the vehicle began, with regular wear and tear. Every nick, dent, scratch, bruise, bang will be reduce (by percentage) the value. This means that there could be serious additional payments for the damages. Even windshield and tires. And trying to stay within the milage limitations means you may have to park the car for months before the term ends, so you don't get charges the expensive milage charges. I've seen it as high as 23 or 25 cents per mile.

@queenv920 5 месяцев назад

Helpful ❤

@saurabhchugh9439 6 месяцев назад

Thanks for going over the math in such a precise and crisp way. However, I felt like there's another expense to be considered that there's generally a higher auto insurance you need to pay on a leased vehicle since most leasing companies require you to purchase a comprehensive auto insurance policy.

@robertk2530 6 месяцев назад

That is not true in every state. Ohio only requires state minimums. Do not fall for that insurance scam.

@Jungernaut 6 месяцев назад

Fireeee 🔥🔥🔥

@coltm6788 6 месяцев назад

The money factor on a lease(which can be converted to interest rate) vs. interest rate on a purchase is the most important variable. Sometimes the lease money factor is cheaper than the interest rate which makes lease total cost of ownership cheaper.

@jerrylundegaard2592 3 месяца назад

There are actually three important variables on a lease, each can be an issue. Firstly there is the price paid. If you do not negotiate the price (capitalized cost on a lease) you will make a bad lease. To the dealer a lease is a sale, a sale to the leading company at the price you negotiate. Secondly there is the money factor. If yo do not ensure the money factor (multiply the money factor by 2,400 to get the interest rate) is applicable to your credit profile you will make a bad lease. Always demand the F&I manager reveal the actual money factor the leasing company approved. Thirdly there is the residual value. This is set by the leasing company and is not negotiable. The RV will vary by the length of the lease and the mileage allowed. Also there is the issue of the acquisition fee. This is a fee from the leasing company and is not negotiable but may be included in the capitalized cost (the amount borrowed).

@2Greenlid 3 месяца назад

Purchasing is always financially better, A lower monthly payment does not mean financially smarter, actually the opposite!

@jlam3297 21 день назад

That's so much information. I wish there was an excel sheet out there where we just plug in the numbers and it tells us exactly how much it would cost us for each option. haha

@alahollywood 2 месяца назад

In my case I leased for 3 years and when the lease was ending I purchased the car the remaining balance for $14,500 . I requested a 401K loan for 16K, and I paid back my loan and with interest in 2 years. I requested 16 K to add sales taxes and I received the title form Toyota financial a week later.

@notNaB2024 6 месяцев назад

Naive question here, but the ~$38K total cost to own when leasing a car and buying out right at the end of the lease assumes that you pay cash for the residual value of the car right? If you have to finance the residual value after your lease matures, then the cost would be higher still.

@ImightBeRight 6 месяцев назад

I can't thank you enough for the quality content! Happy holidays!

@humphrey 6 месяцев назад

Same to you!

@richscott2483 2 месяца назад

Buying outright is best. Forget Leasing unless you have the means to write off on taxes. Overall, Mr. Yang did a good job covering the Pros and Cons.

@RJMeix007 4 месяца назад

The best thing you can do is to buy a 1 or 2 year old used Tacoma, 4Runner, or Tundra (particularly 4x4 double cab 'offroad' or 'pro' model), then sell it just before the powertrain warranty expires at approximately 60k miles or 5 years for pretty close to what you paid for it. The second best is to do the same thing but with a brand new version of one of those 3 vehicles if you can't find a good deal on used, or just prefer brand new. By the time you sell it, it'll average out to less than $100/month lost. But, if you wait too long to sell, you risk running into issues such as the clearcoat showing obvious oxidation, lowering its resale value a couple grand.

@ZEFFENWULF 4 месяца назад

Can confirm. Got my 4Runner Xmas of 2018 and it’s held 100% of the pre-interest value.

@KreeH2023 6 месяцев назад

Car buyer here, typically buy Toyota/Lexus and keep them for over 10years (current Prius is at 13 years). Usually pay off vehicle pretty fast, usually cash to avoid credit interest payments. Its really nice not having any car payment for years. I think leasing also is good for BEVs since the EV market is fairly young and battery tech is advancing year-to-year.

@i.d.6492 6 месяцев назад

Literally any modern car with proper maintance will last 10 plus years even chevy sonic.

@khoihuynh9308 6 месяцев назад

bought my 2013 civic about 8 years ago for 14k. paid it off in 3 years. havent had a car payment since. the car is still worth 14k lol. this is probably the main reason why rich people/people that are good with money say to keep your first car. my maintenance cost is low. basically just oil changes, buying a set of winter tires and swapping them. can't remember if i had to change my brakes/rotors. really nothing to worry about. buy the car if you can take care of your things lol.

@Sturmvogel 2 месяца назад

Rich people don't drive 2013 Civics

@S.L.S-407 Месяц назад

Thanks for a well thought out video. I had always heard that leasing is not the way for an individual to go bc you end up paying more. Here's the problem today, for a lot of people. They can't afford to finance bc the rates are ridiculously high which means the monthly payments are too high. The $551 and $866 amounts you mentioned for financing like leasing, also have to have added on the monthly insurance costs, maintenance costs, and gas costs which make it far more expensive than the stated monthly costs. I am looking at leasing bc of the crazy high interest rates. I have seen 6.99 and 7.99. A monthly payment of under $ 400 allows me to put aside money for a rainy day or to pay the car off at the end of the lease. Yes I am going to be paying more, but I keep my cars on average 14.3 years. Also, if the car is a lemon, I'm not stuck bc I'm not buying it. Right now I'm waiting for at least one year before I buy, bc I want a larger down payment AND I'm hoping rates go down. A rate drop of just 2% can make a huge difference in the monthly payment whether you are leasing or buying. Any comments welcome. P.S., Over the pst 43 years I have only owned 3 cars. I'm allergic to monthly payments, that's why I choose cars that give me a joy kick every time I walk up to them. : )

@phuturephred 4 месяца назад

This is a great video. I still would rather lease kuz i like to change cars alot and if theres ever an accident i dnt have to worry about taking the hit on value. Plus i like the lower payments.

@user-jx9wd5cj8y Месяц назад

that is one benefit of leasing. You don't need to worry about the resell once accident

@robertpayne9009 5 месяцев назад

Thanks!

@karthikkaja234 4 месяца назад

as you mentioned the monthly lease payments includes the taxes, similarly we should account for the sales tax while owning the new/lease vehicle

@abhishekdhiman1157 6 месяцев назад

Hi @humphrey. In case of lease buy out amount of $21,088, are we considering financing interest and fees as well? I'm assuming most people would refinance it if they chose to buy out the car after the lease ends.

@nateschafbuch9916 6 месяцев назад

Constructive criticism: you're assuming the customer has 21,088 cash to buy the residual, you should include the finance costs with a 21k loan (also would there be more fees when purchasing it, for the additional transaction?). Also: you could compare selling the "buy car" at 3 years of the 5 year term. U just need to figure in the payoff of the loan amount against the selling price.

@2004cyrus 5 месяцев назад

I mean he is correct, I’m paying $21,000 to buy my current Mazda CX-5 lease when it’s up in May. My lease payment has only been $477/month and so I saved the cash to buy this thing at the end. Of course I’ll sell it on the private market after that to make myself $6k or so for myself since I have a super clean and low mileage vehicle here to bring to market.

@stevem6047 3 месяца назад

Very interesting and well done, but in limiting the comparison to 3 years you miss the savings that comes with each year of ownership. Most buyers don't sell and buy another every 3 years, and in your example if the car is paid for you're only out maintenance and the additional depreciation. Each additional year reduces the average cost per year, whereas the leasing individual starts all over with another three years of the same costs.

@MrPookiexL3oi 6 месяцев назад

I just had my motor replaced on a 2006 CRV with a used JDM motor. My Total repair was way less than a monthly payment and a car note. I will sacrifice the looks that come with a new/certified used vehicle for financial freedom that way I can use that extra saved money for more important things that matter to me then a car note.

@user-vi2dk1qz5f 4 месяца назад

Thanks for the information. Well done.

@ericfranke1637 5 месяцев назад

Great video. You're right that each deal has to be examined. Leasing Mazdas seems to be a better deal than Toyotas, perhaps.

@Relem_13 5 месяцев назад

What do you mean about leasing Mazdas?

@sylvias5087 6 месяцев назад

Thank you for this analysis. I have been thinking about leasing because I would like a new car but want to wait to see what the electric and hybrid options will be available 3 years from now versus what is available now. Seems to me that market is still figuring itself out. If I buy an internal combustion engine now what will be its residual value in 3 years compared to an electric vehicle or hybrid. Great information in video!

@FUNwithMAKEUP100 6 месяцев назад

Great video, thanks! Would like to know what type of SUV has a high residual value (>65%)that is in this market now? I would like a hybrid or electric. I'm looking to buy, but would lease too. I leased my 2018 subaru crosstrek and definitely made money after all the calculations.

@Jayroso_ 6 месяцев назад

I’m currently in a lease, but I’m not over the mileage limits rather I’m well under the mileage limits and I know that has some value to it too but I was hoping you would’ve covered that portion on the leasing side of things

@humphrey 6 месяцев назад

that is true, i just thought it was too many variables to control for

@WeaverWrestler 5 месяцев назад

This was probably the best explanation of lease vs buy. Thanks.

@charleswalker6109 5 месяцев назад

In some states, such as Missouri, you pay property tax every year on a vehicle you own. This tax goes down slightly each year, but you could be paying out thousands of dollars in annual taxes on the vehicle you purchased. In comparison, many leases cover this property tax over the term of the lease. Another thought, don’t put any money down regardless of lease or purchase. Instead take that down payment money and have it work for you in a way that it (the money) will compound and provide you the cash needed to buy out the lease at end of term, or to make your monthly payment, etc. I purchase rental properties that yield monthly cash flow and that cash makes the monthly payment on the vehicle while also providing me with a tangible, appreciating asset.

@sergeydudukin4214 20 дней назад

You still pay tax just not upfront but spread over the year like escrow property tax with mortgage.

@charleswalker6109 20 дней назад

@@sergeydudukin4214 in regards to your comment, to which scenario are you speaking?

@sergeydudukin4214 17 дней назад

@@charleswalker6109 i am saying that in case of leasing you have to pay 6% sales tax (in KY) of the price of new car and then usage tax also based on current price of the vehicle. Just instead of one time payment it spread over lease term. But that does not eliminate it. And that is not cheap to do that evert three years.

@frankstark7801 6 месяцев назад

@humphrey, in your assessment, aren't you missing the fact that you need to pay taxes (assuming your state taxes car purchases) a second time when you lease a car and then purchase it at the end of the lease?

@sherwinm 3 месяца назад

Thank you for the video. I’ve seen videos saying it’s not a good idea to put a large down payment to further lower the monthly payments on a lease. It’s even possible to not put any down payment but it will just roll into a higher monthly payment. What’s your opinion on down payments on a lease?

@Steve_in_NJ 5 месяцев назад

I have been leasing since 2001. I drive very little, get the top trim level, and get a new vehicle every 36 months. I also pay a lower monthly "rental fee" than if I purchased a vehicle. Right now, technology is changing and I will lease my next Crossover in 2024. In 3 years, 2027, I will either lease another vehicle or see what the automotive industry is doing (EV, new tech, flying cars?). Always knew buying was cheaper in long term, but leasing provides a lower monthly payment. And I don't have to put down a huge down payment.

@RuijieZhou 5 месяцев назад

For a more complete comparison, couls you also add the scenario thqt leasing then buy the lease after it ends? How does it work in the end for like 10 to 15 yr ownership? Also is there any difference between different car types right now? And what if interest rate changes? Would you be able to generate another set of data under that condition?

@jayelghali2303 3 месяца назад

I think its also important to mention our current car loan interest rate situation. Current APR for excellent credit is 7.0% with most people in the 10% range. Currently we have a car oversupply and you can get a 2024 Tundra for 459 a month with a 38K buyout . Reason you might want to lease is to wait out the interest rates drop. Leasing becomes much more attractive.

@timhaas4859 Месяц назад

Very good, but one missing element in this analysis is the value of cash flow. There is lost opportunity cost on the higher payment when purchasing. Cash flow has value.

@Andreyatl 5 месяцев назад

Just installed a new clutch on my only car Nissan Frontier (stick shift) I purchased a brand new in 2002 for $11 200 .meanwhile paid off my mortgage in 7 years

@adrienchan2097 3 месяца назад

In California, you pay the lease sales tax in the residual value too. Plug that in.. u may buy it At end. Compare that total w 5 or 6 year loan. That’s y buy upfront and no headaches later

@obviouslyPSM 4 месяца назад

I’d be interested to hear your take on this for EVs. Teslas seem cheap to lease and with the evolving tech I wonder if purchasing has more risk there

@Kjertinge 6 месяцев назад

Great video Humphrey! I’ve been driving the same vehicle for about 7 years and i was just thinking about “investing” in some new wheels. I make pretty good money and I’m open to a lot of options but mentally I’m still someone who thinks of cars to get me from point A to point B. Maybe one day I’ll get my dream car but for now I want to get something reasonable, hybrid and will last me 5/10 years. So this video has definitely help explain the price differences over a set period. Thanks Hump!

@Fjord_Driver 3 месяца назад

Or buy used and affordable, in the sub 8k range. Yes, they are out there. Full cash purchase from private seller. No finance charges. You can decide if you want to keep collision and comprehensive insurance on it depending on age and condition of vehicle, and where you live. I have a 2001 US made truck I bought used. Paid cash. Spent probably a few thousand on some repairs to A/C and other minor things. Been rock solid reliable since. One oil change per year. I drive less than 8k miles per year currently. It is not a pretty vehicle, but it is damn cheap to own. Keeping up with the appearances is not any concern for me. No debt is important. Truck has almost 300k miles on it now with the original automatic transmission. I change the transmission fluid every few years. Eventually the trans will need replacement. Probably another 3k for a transmission swap. It's a very common unit and easily available. Still ahead of the game.

@kennethko1534 3 месяца назад

13:00 great summary (for those of you that don’t want to watch, that summary and conclusion is worth trusting…). This video is super well done - the analysis and numbers are clean, only one bad assumption made throughout (few people can sell a rav 4 at 79% value after 60k miles…even dealers here in LA cannot get that for a 2019 rav4, no shot a normal car owner can). He warned about it both on screen and mentioned a few extra words about it as well in the audio. Very responsible and fair.

@zander1971shorty 5 месяцев назад

Given that both new and used car prices are expected to fall in 2024 and possibly beyond, how does that effect the lease vs buy decision?

@BlackTheEngineer 6 месяцев назад

In most cases its probably better to buy but for my personal case I think it wouldve been better to lease a car rather than buy. I had less than $1000 for a down payment, about to graduate college but got a job across the country and needed a car desperately to get there and work. Now im stuck overpaying for a car already worth half of the car not im stuck in and the monthly payments are killing me. So if i couldve leased a car for less than $300 a month I would be in such a better situation and would have something to put down on a car with better credit and a good bank (i also didnt have a bank to loan money at the time, only had chime)