even at 4% annual interest, the 41,700 (actually 45100 with tax) will earn
you $5600 over 3 years (becomes 50,700)
actually you pay tax on the lease payments, so the lease cost becomes:
3780 + (35 x 540) = 22,680 - 5600 (earned) = 17,080 (cost of lease)
purchase the car at the of the lease: 17,080 + 20,049(1.0825) = 38,780 total
cost to lease+buy.
purchase price = 45,100
lease cost with purchase = 38,780
difference = $6320
plus, if the resale is less than 20,049, you can turn in the car, and buy
another used one, saving even more money.
looks like you did good in this case.
-james c
----- Original Message -----
From: <Dougie360@aol.com>
To: <atabacco@california.com>; <mrclem@telocity.com>
Cc: <ba-autox@autox.team.net>
Sent: Friday, July 13, 2001 9:14 AM
Subject: Re: Leasing Versus Buying
> Unless I'm doing the math wrong, the reason I leased my SAAB was that it
was
> cheaper than buying.
>
> Here is a current ad running in the papers:
> 2001 SAAB 9-3-SE Convertible MSRP $41,770
>
> Lease: 499/month 36 months
> $3492 lease inception: includes 1st month lease payment, sec dep, acq fee
>
> Option to purchase at end of lease for: $20,049
>
> Therefore, cost of lease = 3492 + (35 x 499) = 20,957
>
> If I intended to buy the car, I would add the 20,049 which then totals
> $41,006.
>
> This looks like less then the MSRP. Not to mention adding in the time
value
> of money (i.e. james' point about investing the upfront cash in a money
> market)
>
> Looks like a 0% interest charge.
>
> Why would anyone buy if there was anything higher than a 0% interest for
> financing?
>
> Doug
> 9-3 Viggen
>
> In a message dated 7/11/01 8:40:05 PM Pacific Daylight Time,
> atabacco@california.com writes:
>
> << No you're absolutely right. Buying will almost always be better than
> leasing. Leasing is useful only under certain (usually personal or
business)
> circumstances. In the long run, buying and than amortizing the purchase
out
> over the longest period possible will always result in the least dollar
per
> mile cost. The old (before the tax laws changed) rule was, "If you can
> afford to buy, lease". Optimally, you could look at purchasing a two to
> three year old car (maybe off lease) that has taken its initial
depreciation
> hit .Of course, leasing could allow the really competitive autox type
person
> to field and campaign the newest "flavor of the month "car every two
years.
> Tony
> ----- Original Message -----
> From: "Michael R. Clements" <mrclem@telocity.com>
> To: "James Creasy" <black94pgt@pacbell.net>; "Anthony Tabacco"
> <atabacco@california.com>; "Kelly, Katie" <kkelly@spss.com>
> Cc: <ba-autox@autox.team.net>
> Sent: Wednesday, July 11, 2001 7:34 PM
> Subject: RE: Leasing Versus Buying
>
>
> > My experience regarding lease vs. buy is a bit different.
> >
> > For example, take my '95 RX-7. Bought it new in April '96 for $39k
> including
> > all taxes, fees, etc. Sold it in August '00 for $25k. Paid cash so no
> > interest paid. Total cost of ownership: $14k + maintenance and about
$2.5k
> > of high performance addons. The maintenance was purely oil changes, the
> car
> > had only a single minor problem and that was fixed under warranty at no
> cost
> > to myself.
> >
> > If I had leased the car, it would have cost at least $400 per month.
Call
> it
> > only 48 months for round numbers. That's $19200.00 in payments. I'd
still
> > have to pay the oil changes even if I were leasing, and I still would
have
> > bought the extra parts, so they cancel out of the equation.
> >
> > When all was said and done, I saved $5000 by buying instead of leasing,
> and
> > this is estimate is conservatively low. Not a bad chunk of change even
for
> > guys who don't worry too much about money.
> >
> > As you can see, if the RX-7 did not hold its resale value, and I sold
it
> for
> > $20k instead of $25k, then it would have been a break-even between
leasing
> &
> > buying. This is what people mean when they say it's better to lease a
car
> > that doesn't hold its value over time.
> >
> > I won't even mention my Honda Civic (OK well I guess I just did), which
I
> > bought new for $7k back in 1990. The only unscheduled maintenance it
has
> > ever had was a headlight that burned out. Cost me $10. The car still
runs
> > like new and is about as close to free transportation as you can get.
Glad
> I
> > bought it instead of leasing!
> >
> > Now I'll pass on to you the advice my Dad gave me way back when, which
is
> > the same advice that thousands of other Dads have given their kids, and
> that
> > has saved me money several times since:
> >
> > If you intend to keep the car for its useful life (or at least several
> > years), and you expect it to be fairly reliable (or hold its resale
> value),
> > then buy it.
> >
> > If you want to drive a new set of wheels every 2-4 years, and you will
be
> > driving cars that you expect might not be ultra reliable, or that might
> not
> > hold their resale value well, then consider leasing it.
> >
> > The future always has a degree of uncertainty so the buy/lease decision
is
> > always an educated guess. My personal experience makes me lean towards
> > buying unless there is a really compelling reason to lease.
> >
> > -----Original Message-----
> > From: owner-ba-autox@autox.team.net
> > [mailto:owner-ba-autox@autox.team.net]On Behalf Of James Creasy
> > Sent: Wednesday, July 11, 2001 19:00
> > To: Anthony Tabacco; Kelly, Katie
> > Cc: ba-autox@autox.team.net
> > Subject: Re: Leasing Versus Buying
> >
> >
> > > sometimes cars that are expected to hold their value
> > > well can be decent candidates for leasing.
> >
> > the nice thing about leases is that you know in advance exactly how
> > depreciation you will paying.
> >
> > but buy or lease, you pay the same depreciation. more on a fast
> > depreciating car, less on a slower one. typically the slower ones are
> > slower depreciating in percentage, but are more in actual dollars. in
a
> > purchase, you can kind of hide the depreciation, but you are paying it
> > none-the-less.
> >
> > the big disadvantage to a lease is that it is harder to get out of than
a
> > purchase.
> >
> > -james c
> >
> >
> >
> >
> >
> >
> > ----- Original Message -----
> > From: Anthony Tabacco <atabacco@california.com>
> > To: Kelly, Katie <kkelly@spss.com>
> > Cc: <ba-autox@autox.team.net>
> > Sent: Wednesday, July 11, 2001 6:20 PM
> > Subject: Re: Leasing Versus Buying
> >
> >
> > > Katie, last time I looked, whether the 2000 will live or die in
AStock
> > > (they're going to rename the classes though) depends on the classing
of
> > the
> > > Boxter S. This is still under discussion. If the BoxterS stays SS,
the
> Z06
> > > will likely be able to edge it, if it goes to AStock, the S2000 could
> have
> > a
> > > hard time.
> > >
> > > In response to the leasing question, I would note the old truism that
> > there
> > > are only three things that ought to be rented. Propriety (and
> undoubtedly
> > > diligent webmasters) would forbid their mention in a forum such as
this.
> > > Suffice it to say cars are not one of them. I do understand that
> > dependiing
> > > on market conditions, sometimes cars that are expected to hold their
> value
> > > well can be decent candidates for leasing.
> > > Tony
> > >
> > > ----- Original Message -----
> > > From: "Kelly, Katie" <kkelly@spss.com>
> > > To: <ba-autox@autox.team.net>
> > > Sent: Wednesday, July 11, 2001 5:21 PM
> > > Subject: RE: Leasing Versus Buying
> > >
> > >
> > > > A new car doesn't really make much sense. I've just been
corresponding
> > > with
> > > > Brent at SF Honda. He threw some numbers at me. A lease almost
sounds
> > > > reasonable, except for one thing. I can't afford it. Not right now,
> > > anyway.
> > > >
> > > > Any ideas as to how the Honda S2000 will fit in Solo II's new
classing
> > > > structure next year?
> > > >
> > > > Doesn't matter. It's the year FOLLOWING that I'll even be able to
> think
> > > > about it.
> > > >
> > > > In the meantime, anybody know anything about road bikes?
> > > >
> > > > Katie
> > > >
> > > > -----Original Message-----
> > > > From: James Creasy [mailto:black94pgt@pacbell.net]
> > > > Sent: Wednesday, July 11, 2001 5:23 PM
> > > > To: Clifford Richardson; kkelly@spss.com; ba-autox@autox.team.net
> > > > Subject: Re: Leasing Versus Buying
> > > >
> > > >
> > > > if you want to drive a new car, then i see no reason not to lease,
> > > > financially.
> > > >
> > > > new cars, leased or bought, cost you big time in the hidden specter
of
> > > > depreciation.
> > > >
> > > > > -Buy if you don't intend on paying for a car for the rest of your
> life
> > > >
> > > > but you see, this isnt true. you pay depreciation. at least with
a
> > lease
> > > > you can get out of it when the lease ends, or buy the car if you
like
> > it.
> > > > (only true for closed-end leases)
> > > >
> > > > however, to me all new cars are pretty much the same as the next,
so i
> > > dont
> > > > bother much with them.
> > > >
> > > > -james 'never bought a new car' creasy
> > > >
> > > >
> > > >
> > > > ----- Original Message -----
> > > > From: Clifford Richardson <the_brain7@hotmail.com>
> > > > To: <kkelly@spss.com>; <ba-autox@autox.team.net>
> > > > Sent: Wednesday, July 11, 2001 4:48 PM
> > > > Subject: Re: Leasing Versus Buying
> > > >
> > > >
> > > > > Not sure how my thoughts would rate since my first autox run is
yet
> to
> > > > come
> > > > > but here goes...
> > > > >
> > > > > My car's leased. An advantage for me is that I don't worry too
much
> > > about
> > > > > pushing her too hard. She's still under warranty and after I've
> > whipped
> > > > all
> > > > > the performance out of her, I get to give her back and get a
fresh
> > car.
> > > > The
> > > > > minus is the possibility that she and I may become a perfect
> > driver/car
> > > > > combo after so many miles. Returning her might set me back a bit
> while
> > I
> > > > > essentially build a whole new relationship with a new vehicle.
You
> > > > > know...learning how that car handles, it's moods, limits,
etc...No
> two
> > > car
> > > > > is ever the same, just like no two g/fs...um...nevermind.
> > > > >
> > > > > Did any of that make sense? :-) didn't think so...
> > > > >
> > > > > General thoughts:
> > > > > -Don't use your leased car to auto-x if you're afraid of extra
> charges
> > > for
> > > > > dings, etc...
> > > > > -Lease if you don't drive long distances and you have excellent
> credit
> > > > > -Lease if you're loaded
> > > > > -Buy if you don't intend on paying for a car for the rest of your
> life
> > > > > -Buy if you're gonna customize the car
> > > > > -Lease if you want a brand new car every 3-5 years
> > > > >
> > > > > Just thoughts, I'm sure some of you may disagree.
> > > > >
> > > > > -Arnold
> > > > >
> > > > >
> > > > > ----Original Message Follows----
> > > > > From: "Kelly, Katie" <kkelly@spss.com>
> > > > > To: "'ba-autox@autox.team.net'" <ba-autox@autox.team.net>
> > > > > Subject: Leasing Versus Buying
> > > > > Date: Wed, 11 Jul 2001 15:59:18 -0700
> > > > > MIME-Version: 1.0
> > > > > Received: from [207.173.21.42] by hotmail.com (3.2) with ESMTP id
> > > > > MHotMailBD162861004540043260CFAD152A0BE50; Wed, 11 Jul 2001
> > > 16:12:35 -0700
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> > > > (8.11.0/8.11.0)
> > > > > id f6BN8QJ04434for ba-autox-actors; Wed, 11 Jul 2001
17:08:26 -0600
> > > (MDT)
> > > > > Received: from hqmrelay.spss.com ([64.16.210.2]) by
> > > teamfat2.dsl.aros.net
> > > > > (8.11.0/8.11.0) with ESMTP id f6BN8Mx04429 for
> > > <ba-autox@autox.team.net>;
> > > > > Wed, 11 Jul 2001 17:08:22 -0600 (MDT)
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> > > Wed,
> > > > 11
> > > > > Jul 2001 18:08:16 -0500 (CDT)
> > > > > Received: by SFEMAIL1 with Internet Mail Service (5.5.2650.21) id
> > > > > <3TQSVFRG>; Wed, 11 Jul 2001 15:59:20 -0700
> > > > > From ba-autox-owner@autox.team.net Wed, 11 Jul 2001
16:13:43 -0700
> > > > > Message-ID: <93456CB7A08FD211B33D00A0C99D6373701E19@SFEMAIL1>
> > > > > X-Mailer: Internet Mail Service (5.5.2650.21)
> > > > > Sender: owner-ba-autox@autox.team.net
> > > > > Precedence: bulk
> > > > >
> > > > > Hey, anyone out there leasing their autocross vehicles? Can you
tell
> > me
> > > > the
> > > > > pluses and minuses?
> > > > >
> > > > > Thanks,
> > > > > Katie K.
> > > > >
> > > > > _________________________________________________________________
>
>
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> From: "Anthony Tabacco" <atabacco@california.com>
> To: "Michael R. Clements" <mrclem@telocity.com>
> Cc: <ba-autox@autox.team.net>
> References: <NBBBKJCMBEMCOOJCJHKGMEMIAIAF.mrclem@telocity.com>
> Subject: Re: Leasing Versus Buying
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