Need1
Enthusiast
Hey Guys -
What would be the pros and cons of leasing an 05'?
What would be the pros and cons of leasing an 05'?
What are some good tips for when i'm dealing with these salesmen...? What is a good price to ask for, for a 05' Mamba? I think the dealership is asking 85-88K but i've seen 05's from dealerships in ebay, brand new, for 75k
Actually, here’s the breakdown on how much leasing really costs vs. buying…
Lets say you decide to plop down 80K on a new Viper. At the end of the first year, your Viper will worth at most no more than 74K. At the end of the second year, your Viper will be worth no more than 68K. At the end of the third year…well, you get the idea. Basically, it’s costing you about 6K a year to own a Viper.
Lease payments on new ones can be had for as low as $800 a month ($9600 a year). Leasing now allows you to take your 80K that you would have spent on buying and invest it at 12%. A 12% return on 80K will get you $9600 annually. This basically lets you recover the entire amount you spent on your least payments.
Bottom line…
Annual cost of owning = $6,000
Annual cost of leasing = $0.00
Actually, here’s the breakdown on how much leasing really costs vs. buying…
Lets say you decide to plop down 80K on a new Viper. At the end of the first year, your Viper will worth at most no more than 74K. At the end of the second year, your Viper will be worth no more than 68K. At the end of the third year…well, you get the idea. Basically, it’s costing you about 6K a year to own a Viper.
Lease payments on new ones can be had for as low as $800 a month ($9600 a year). Leasing now allows you to take your 80K that you would have spent on buying and invest it at 12%. A 12% return on 80K will get you $9600 annually. This basically lets you recover the entire amount you spent on your least payments.
Bottom line…
Annual cost of owning = $6,000
Annual cost of leasing = $0.00
...........invest it at a 12% return, where?
And how did the Fund Return over the past 5 years?
I bet it didn't have a positive return!
...........invest it at a 12% return, where?
And how did the Fund Return over the past 5 years?
I bet it didn't have a positive return!
And how did the Fund Return over the past 5 years?
I bet it didn't have a positive return!
On the fund I sited above, 5 year is not that great because it includes the “crash” of Q4 2000 but it still comes in at a respectable 5.71% for 5 years.
That fund’s 3 year is pretty decent at 13.59% and 10 year is 13.98%.
The downside on funds is always going to be limited because the funds are not only diversified across companies but also across business sectors – plus they’re fluid and can adapt. The particular fund sited above is actually rated as “medium” risk and makes a return of 10%+ look like a total no-brainer.
Anyway – even if your 80K investment made only a measly 5.71% annually, your leased Viper would still only cost $5032 a year to own versus $6000+ a year to own when dealing with annual depreciation of the “owned” Viper.
And how did the Fund Return over the past 5 years?
I bet it didn't have a positive return!
On the fund I sited above, 5 year is not that great because it includes the “crash” of Q4 2000 but it still comes in at a respectable 5.71% for 5 years.
That fund’s 3 year is pretty decent at 13.59% and 10 year is 13.98%.
The downside on funds is always going to be limited because the funds are not only diversified across companies but also across business sectors – plus they’re fluid and can adapt. The particular fund sited above is actually rated as “medium” risk and makes a return of 10%+ look like a total no-brainer.
Anyway – even if your 80K investment made only a measly 5.71% annually, your leased Viper would still only cost $5032 a year to own versus $6000+ a year to own when dealing with annual depreciation of the “owned” Viper.
There is a big difference, leasing is a straight expense meaning 100% of the lease cost per year is considered an expense in the same tax year but on a "buy" you have to depreciate the vehicle, meaning, and that is especially important on an expensive car, only a small %, and decreasing every year, is an expense.