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re: If an employer pays full mileage rate, does leasing make sense?
Posted on 8/3/14 at 6:19 pm to HubbaBubba
Posted on 8/3/14 at 6:19 pm to HubbaBubba
How long do you plan to keep the car? Only 3-4 years, or do you expect to get it paid off and keep it forever?
I've run numbers multiple times on lease vs. purchase, and the numbers are always very close (within 1-2%), with advantage depending only on interest rate. However, all of these assessments assume the car will be unloaded at the lease end equivalent (whether buying or leasing). If you keep it long term, the depreciation shifts strongly in favor of purchasing. Also, keep in mind they do have higher mileage leases (15k/yr) which will give you a better idea/locked in residual rather than paying the mileage overage fee. Also, if the vehicle is kept in good shape, it may be worth more at term end than the residual, in which case you can trade it and potentially get the equity out of it.
For tax advantages, I'm not familiar since I don't write off my vehicles. However, I believe the lease has an advantage here since you are financing ONLY the depreciation allowing it to be fully written off. But, I honestly don't know.
As for vehicle, I'd recommend taking a look at the Infiniti M/Q70 or G/Q50. Cheaper and still very upscale in appearance.
I've run numbers multiple times on lease vs. purchase, and the numbers are always very close (within 1-2%), with advantage depending only on interest rate. However, all of these assessments assume the car will be unloaded at the lease end equivalent (whether buying or leasing). If you keep it long term, the depreciation shifts strongly in favor of purchasing. Also, keep in mind they do have higher mileage leases (15k/yr) which will give you a better idea/locked in residual rather than paying the mileage overage fee. Also, if the vehicle is kept in good shape, it may be worth more at term end than the residual, in which case you can trade it and potentially get the equity out of it.
For tax advantages, I'm not familiar since I don't write off my vehicles. However, I believe the lease has an advantage here since you are financing ONLY the depreciation allowing it to be fully written off. But, I honestly don't know.
As for vehicle, I'd recommend taking a look at the Infiniti M/Q70 or G/Q50. Cheaper and still very upscale in appearance.
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