Thinking about leasing your car? Consider how you'll use your new car to see if the deal makes sense

So you’re at a car dealership browsing the latest high powered machine to get you around town, and you’ve found that perfect ride that tells the world exactly what kind of person you are. It’s sleek, stunning, and what’s under the hood purrs at only you. It speaks to you in a way that no hunk of metal ever has before.
You think that the hard part is over; the decision is made, after all, so what’s left to worry about? Like just about every other person who has found the perfect car, now you have to decide whether you want to lease or buy.
Folks who lease often do so for two primary reasons. First they enjoy the benefits of always driving a newer vehicle with fewer service issues that is always under warranty anyway. Second is the appeal of being able to afford a more luxurious, faster, or more expensive car than you might if you’d purchased. The company who leased the car to you has the added benefit of the customer loyalty which can average about three times higher for folks who lease than those who buy. But forget about the company, this is about what’s best for you.

Making it your business
One of the benefits of leasing a car pertains to those who claim their car as a business expense on their taxes. Almost all lease expenses associated with business purposes can be deducted, so if you fall into this category you may want to take a trip to your tax adviser’s office and ask him (or her) if a lease makes any sense for you.
Still, unlike purchasing a car, you’ll have to turn the car in at some point per the terms of the lease, and when you do, you won’t have any opportunity to roll equity from your car into the next one if you want to upgrade your ride.

You will pay
Automobile leases commonly stipulate the maximum number of miles you may drive in your rented car in a year. First, a consumer should consider whether or not the maximum mileage rate is appropriate for the number of miles driven. If the auto dealer says you can’t drive more than 15,000 miles in a year, then don’t kid yourself, you will pay for any mileage over that. We’re not talking small beans here, either, some penalties run as high as 25 cents per mile over the annual allowance.
Let’s make this really simple: if you plan on keeping the car for any more than four years or plan on driving any more than 15,000 miles a year, then you probably should have bought. If you were only going to use the car for Sunday drives and trips to the grocery store then leasing may be the most reasonable route for you.
To get technical, just go to www.contewealthadvisors.com, open the pop up “lease or buy” calculator and punch in a few details about the lease or purchase in question and let the computer decide.

Anthony M. Conte is Managing Partner at Conte Wealth Advisors with offices in Camp Hill, Pennsylvania and Fort Myers, Florida. He has a Master’s Degree in Financial Services and the CERTIFIED FINANCIAL PLANNER ™ certification, and he welcomes your emails: tony.conte@contewealthadvisors.com.
Registered Representative Securities offered through Cambridge Investment Research, Inc., a Broker/Dealer, Member FINRA/SIPC. Investment Advisor Representative Cambridge Investment Research Advisors, Inc., a Registered Investment Advisor. Cambridge and Conte Wealth Advisors, LLC are not affiliated.