Car Lease or Finance?

Usually the maintenance on brand new cars for the first 36k miles (typical lease term) is minimal. Like a few oil changes and tire rotations minimal so ~$500 or so over 3 years. The dealer may include some of that anyhow, lease or loan. So comparing a lease vs. loan of the same exact vehicle for maintenance costs isn't terribly helpful in the short term. The items that will need frequent maintenance are your brakes and tires. I've had 2 leased cars need tires before turning in the lease (there's tire tread depth requirements for lease turn-in). In one case I bought used tires cheaply ($100) that barely met the requirement and turned it in since new tires were like $800 or so.

Leasing is a good option for cars where the brand is known for really expensive repairs (i.e. luxury or German made) and you want to try out that brand for 2-3 years and have zero strings attached at the end if you don't like it. If you have a budget of $X per month and just want to always have a car under warranty and maintenance covered then leasing will give you that peace of mind, at an added cost.

Your key things at lease end that will cost you are scratches, paint or fabric issues larger than a credit card/dollar bill (depends on lease), tire tread depth and mileage over the lease terms.

Long term maintenance for higher quality cars is going to make the total cost of ownership of a car be much cheaper than leasing. Pick a right sized Toyota, take a loan out and do all the scheduled maintenance at the right times and you could easily see that car get 200k miles before larger issues happen.

If you are not a car enthusiast, and only want reliable personal transportation to take you from Point A to Point B with minimum fuss, the usual suggestion for being financially prudent is to find a used Toyota or Honda and drive it until it dies.

A lease costs you more and makes more for the dealer (former car finance mgr here).

They're usually only advantageous for a business which can write off the monthly "rental" cost vs making a capital investment that's amortized over time.

With individuals, unscrupulous dealers use leases to shove people into more car they they can afford, since at the end of your payments with a lease you get nothing.

Generally speaking (and besides possible tax advantages that depend on your local tax code and financial situation) a lease is not cheaper, it is usually much more expensive, though not all leases have the same terms and offer the same levels of servicing.

The only advantages (talking of an integral lease, i.e. one where everything maintenance related is included) are those of knowing in advance what you will pay, no matter what happens and - again generally speaking - you will have a "better" insurance and replacement car in case of prolonged workshop stops.

It may make some sense if you have a constant, fixed, income or you are making a budget for a firm, and if you are terrible at driving (as you will have a known in advance fixed monthly payment, with no peaks in case of large repairs), but it will cost more in the end, besides, hard to say where you live, in some cases it will be complicated to bring in the car for maintenance and there may be "caps" or "ranges" on yearly mileage (if you choose more miles than you actually drive, you are wasting money, but if you exceed the chosen mileage, you will pay the excess mileage a lot).

I recently finished my lease from ford and found it to be decent from a cost perspective, primarily because I am foreign (no loan history) and financing rates were very high at the time. I bought the car outright at lease end for the agreed amount (residual value), I could have easily handed it back and walked away. This level of optionality is awesome imo. Be careful however, the financing terms of a lease agreements can be difficult to digest and some companies like Tesla do not allow you to purchase at the end [1]

[1] https://www.tesla.com/support/leasing/lease-end-options

It really depends on the terms of the lease and your habits. If you're the type to change cars often (every 3-5 years) and want the latest and greatest and to not worry too much about maintenance, then leasing isn't a bad option.

From a financial perspective, you'll almost always come out on top financing and keeping the car long term. Usually if you finance 5-6 years, and maintain the car, you can easily get another 5-6 years out of the car without too many issues and no payments. And then you have a bit of equity to put towards your next one when the time comes.

I've leased and financed in the past, but some of the lease deals I got were really really good and made sense at the time.

I looked a used car site and looked at cars 10+ years 200k+ miles for sale that were used. I looked at which brand/models were the best from long run perspective.

Then I bought one that was like 5 years old at the time.

At the time is was a Toyota Camery.

If you don't plan on keeping it for 7 years and/or your not planning on driving it bunch of miles then go with a lease.

going the other direction if you want to have fun and have a flashy car that makes you sound richer than you are the best bang for your buck is a used porsche boxster. at least in the midwest. You won't impress car people or rich people but at the end of the day you still drive a porsche.

And what ever you do don't let them drive it especially if they're drunk.

Neither. I buy an old car and pay cash. The dollar-to-happiness ratio of a new car is abysmal. I prefer to spend the money elsewhere.

Buying a new car is a waste of money. The most effective way is to use a car pool for times when you really need a car.

If the car is for commuting to your job every day is it possible to find another way?