Having a car in college: Is it better to lease than buy a car?
Leasing is a good idea if you don’t want to commit to a car
Of course there are pros and cons to leasing, but as a student you have considerations that others don’t – and the cost involved in either buying or leasing is only one of them. If you don’t want to make a commitment to a car, then leasing is an ideal try-before-you-buy option. If you find that you want to keep it at the end of the lease then you can buy it, but otherwise you can say goodbye and move on. Not only that, but you will get to drive the car while it is new, and take advantage of the most up-to-date technology. Also, you won’t have to worry about selling or trading it once the lease is up – just turn it in and start shopping around for your next vehicle.
As a student you likely don’t need much mileage
This means you are free to go with a lower mileage limit which will of course work out cheaper. If you definitely need a car but won’t use it that often or drive that far, then leasing might be a better option for you than buying. If you buy, you will pay the same price regardless of how often – or not – you use it; with a low mileage limit on a lease, you might save a considerable amount of cash. Don’t underestimate your mileage, however, as it will cost you more in fees.
Leases usually run for between 24 and 36 months which offers you flexibility, and you can choose the length of lease that works best for you. Bear in mind that a longer lease means lower monthly payments. There are many types of lease out there – try a broker like Intelligent Car Leasing. You should easily be able to find a lease with a term that works for you.
The ‘Cancel Anytime’ lease
If your circumstances are likely to change then there are ’cancel anytime’ programs available as well. If you can keep to the terms it will be great for your credit rating – but it will take a knock if you have to break the lease. If you think this might happen then ask about a ‘cancel anytime’ plan. Make sure you only commit to what you can afford.
Low down payment and monthly payments
Your initial down payment and monthly payments are typically lower when you lease rather than buy a car outright. In the short to medium term (up to about 3 years), leasing is almost always cheaper than buying and you can spread the cost of the lease over the entire term. Look at your budget, and get some quotes to see what will fit in with your financial circumstances. If you want help choosing a car to buy or lease, have a look at our article to find out what your car says about you!
Do you have a car at university? Share your thoughts on leasing below.