When Leasing a Car Makes Sense for Young Families

leasing a carYoung people starting out have a lot of expenses associated with starting a family. They not only have the expenses related to purchasing a home, they also need to purchase food and clothing for their children as well as pay their school tuition. One way to reduce the amount of money spent on necessary items every month is to lease a car rather than purchase it. There are many advantages to leasing which can benefit a young family.

The first advantage is the reduced amount required for the monthly payment. Rather than having to pay several hundred dollars each month, a lease payment can be half the amount of a standard auto loan payment.   With car leasing going in the family friendly direction, more and more benefits are being offered to entice young families.

In addition to having a lower monthly payment, people who lease vehicles do not have to pay a large amount of taxes on the car they choose to lease. In contrast, purchased vehicles require the taxes on the full amount of the purchase price be paid at the time of the sale. A lease is also set up as a different contract agreement than a financial loan. Most people who choose to purchase a car take out loans in order to pay for the vehicle they choose, The payment period for these loans is stretched out over a long period of time, which can tie up necessary funds a young family might need for other situations.

One of the better benefits to leasing a vehicle is the maintenance and warranty coverage provided on the car. No wonder top business fleet management companies are headed in the leasing direction!   When purchasing a vehicle, the owner is responsible for all of the fees associated with maintaining the car unless they are still under warranty. Leased vehicles have warranties which cover the maintenance for as long as the person continues to lease the car. This also saves families money over the cost of having repair work done to their vehicle.

Another beneficial advantage is the ability to bring the car back to the dealer to terminate the lease or make an exchange. Many people who lease vehicles find it an easy and economical way to trade up to newer models. Many dealerships also offer customers the option of buying their leased car when the lease expires. This also saves money over having to come up with the cash amount for making a purchase right away. By deferring the purchase for a year, families have time to build up their savings so they can afford to get the car of their choice.

photo by brettlevin