Lease... did i get screwed?

Which is okay if that's what you want to do. Just like gambling is okay if you can afford it and understand that you are paying for entertainment, not investing to get rich.

I don't mind seeing people waste money, as long as they are fully informed and can afford it. I don't like to see people lose money by being misinformed or delusional.

Tom

 

Funny how my accountant/lawyer/business owner friends all lease their cars and trade them every 3 years. They are sure a bunch of fools according to you...or perhaps you just need to be edumacated about the pros of leasing...you sound solipsistic though (perhaps even borderline) so there is no point.

 

Are there tax advantages to leasing for the above folks? (I don't know our tax system well enough to know as I've never been in such as position).

I think for many people where there is no tax advantage, going thru cars every 3 years, either via leasing or buying then selling/trading in is a needlessly expensive habit.

 

I know whatchu mean. This is typically my train of thought for most of my purchases. I usually wait a week before purchasing to see if I still want it. Then I ask myself,

- Do I need it? Is the price good? Am I getting ripped off? Will this make me happy? etc etc.

Answering these in your head helps eliminate buyers remorse. In fact I have not had buyers remorse in years...

 

A Lexus IS-F is even faster than an 335i and I even dare say it's faster than the M3 (on paper at least).

 

1. The M3 the way I would have it is $75k. The 335is is $65k. I've never seen a "base" M3 at the track.

2. The performance the CTS-V is undeniable. However, it's just too much money for a car that lacks the fit-and-finish or refinement of the BMWs. I've been in several CTS-Vs...unfortunately after a relatively short amount of time you're reminded it's a GM.

 

The IS-F has some wonderful qualities. That engine is divine. However, Toyota has a long way to go in the steering/chassis department before they make inroads on the German offerings.

People buy the Lexus for it's legendary quality, quietness and comfort. Serious drivers will 100% of the time opt for the BMW/Porsche/Audi. The LF-A, however, my be legitimate.

The GT-R is a freakishly fast car. But even it lacks well behind the overall driving experience of the German cars. The Corvette is supercar fast with insane, track ready handling. But I'd never own one for the aforementioned reasons.

 

I would buy the Lexus over BMW. It just fits my style better. BMW is so pretentious.

In fact I wish the IS-F wasn't branded by Lexus. I would even consider de-badging the Lexus and slapping a Toyota badge on there. **** name brands. Capitalism corrupted Japan a few years ago when they introduced Lexus in Japan.

 

Here is a rule of thumb. If your credit score is less then 775 then you do not have a clear understanding of how to manage money. A lease is not a good investment for you. Neither is buying a new car ever three years.

I bet 100% of people with a credit score over 775 never lease a car.

 

I agree, buy a car with your hard earned money and keep it for more then 3 years. It’s Toyota it will last forever.

You need to find a new accountant. Buying a car has more tax advantages then leasing. It is a lot easier to right off a fixed lease payment over the millage or deprecation of purchasing a car. That is why lazy accounts prefer leasing. In this bad economy it is better to save money then being lazy.

 

Seems like short term though a lease is cheaper on the monthly payments- no?

 

My credit score is 805 and I've leased 7 cars in the last 15 years and bought 3 cars. I've regretted purchasing those 3 cars.

 

Wrong! leased atleast 10 the last 15 years, score above 775, have money to buy them, but 1) have businesses that need write off, 2) DONT want to ever have to work on them 3) want something new.

I have a 2007 Ram I leased cheap and then bought - Its only got 26k, limited edition, and very fast - and still wish I would have leased a new 2010 last summer when I had the chance.

You are mis-informed. Oh, my 401k has MORE money in it than it did 5 years ago too.

 

The only car I have that Im glad I bought, kept and didnt lease,

I have a twin to this one in the garage for special occations!

148mph+ top end
403cuin balanced and blue printed Olds
4 barrell
auto

and gets 24mpg on a very good day...

 

some really good advice

One observation?

Lease residuals tend to drop during the course of a year. That's because three years from that point, the car's projected value will drop over time, and at some point, will be closer to a 4 year old car than a 3 yr old car.

Comparing a lease from a year ago or even 6 months ago is wacky because residuals are vastly different, even from just 2 months ago!

I have used my son's II leased in March as an example previously... his residual at 12K in March was $16416 and today, that same car's residual would be $14596. Loads less. Rates are not that different now... so trying to compare a March lease to an October or November lease isn't fair.

Today, I got a call from a gentleman whose best pal leased a IV with sunroof the last week of August. The same car now has a residual that's $800 less! Meaning, approx $25 a month with tax difference in payments, and August's rates for tier 1+ were .00001 vs the .00025 they are today. That's another $10 a month difference ... so it's really important to compare all of the components before asking "is this lease a good deal" and then telling someone you have the same car at $40 a month cheaper. You may have the same car, per se .. but you also had different terms available to you at the time you leased. It is very important to share all of the components of the deal so we would know how to respond, advise, or help!

Dianne

 

I bet you're completely wrong.
100% completely wrong.
And, for that matter, what does an arbitrary fico score # on any of the three credit bureaus have to do with managing money?

Leasing is a great deal for some. And, buying is a great deal for others. It depends on your needs, your intentions, and overall expense intent. It's quite different for everyone.

 

Re: some really good advice

Why do the residuals change that much ? Is it because they fetch less in 3 years (because of model year) ?

 

dp .. dp ..

 

So long as a "deal" is defined as getting what you want, sure. That, however, is circular reasoning.

I am more interested in whether leasing ever saves money over outright purchase. My understanding of tax write-offs is that they are similar.

The only two scenarios that come to mind are related to unexpected future high depreciation, such as might be seen after an accident or e.g. in the case of Toyota's recent PR problems. These of course only come into play if the owner is trying to sell the car.