Cars--buy or lease?

[FREE866]

Hi there
I live in NYC and haven't owned a car since 1989 ha



My 21 year old niece lives in a rural/suburbia area and needs a car.



What makes most sense? buy or lease?
she says she might want a truck or an Audi.....I would think truck is pain to park...anyway....open to any suggestions on best way to go about this and not get ripped off by some dealership


thank you

 

[Aerides]

not enough info. Depends on the car, the driver, and the financing. Some cars are a steal to lease for 24 months, lame for 36, vice versa.

Also personal preference. At 21 she might do well to lease something like a Toyota Tacoma. By 24 she might need/want something bigger or different. In general, Audi's are not entry level cars for any type of payment.

 

[njhowie]

Hi there
I live in NYC and haven't owned a car since 1989 ha

My 21 year old niece lives in a rural/suburbia area and needs a car.

What makes most sense? buy or lease?
she says she might want a truck or an Audi.....I would think truck is pain to park...anyway....open to any suggestions on best way to go about this and not get ripped off by some dealership

thank you

In NYC, certainly a truck is a pain to park. In a rural/suburbia area likely not as difficult.

I think the key question when considering buy/lease is how long does she intend to keep the car? If she'd be looking for something new in a few years, then I'd say to seriously consider leasing. If she's the kind of person that will keep it until it dies and has to be towed to the dump, then buy.

 

[FREE866]

In NYC, certainly a truck is a pain to park. In a rural/suburbia area likely not as difficult.

I think the key question when considering buy/lease is how long does she intend to keep the car? If she'd be looking for something new in a few years, then I'd say to seriously consider leasing. If she's the kind of person that will keep it until it dies and has to be towed to the dump, then buy.

Thx Howie
I should have clarified. I live in nyc. She lives in Connecticutso not city. She wants an Audi. and yeah thinking 5+ years so maybe buying a solid used car is option

Are sites like cars dot com legitimate places to go?
Thx for you help.

 

[COcheesehead]

All the manufactures have build it, buy it, lease it websites. Run the numbers and see what you get. Over the years we’ve bought and leased, but it was all dependent on the circumstances, time of life, deals available at the time. There might be incentives for certain autos.

 

[disneysteve]

Houses and cars are what keep most people from achieving financial independence. Leasing is a fancy word for renting. Would you rent a car for 2 or 3 years? I wouldn't.


At 21, she should be looking to buy a decent late model used car, maybe 4-5 years old, that she can keep for 10 years. Pay it off in 3 and be payment free for 7, during which time she saves up to buy a better car next time around.


Our daughter bought her first car when she was about the same age. She paid $5,000 for a 7-year old Hyundai. Kept it for 5 years and this past November she sold that and bought a 2018 Hyundai (better model) for $19,000.


Yes, I realize that there can be times when a lease seems to make sense, but very rarely if ever will it beat buying and keeping long term. I had my last car for 8 years (it was 6 years old when I bought it) and had the one before that for for 12 years (it was 1 year old when I got it).

 

[njhowie]

Thx Howie
I should have clarified. I live in nyc. She lives in Connecticutso not city. She wants an Audi. and yeah thinking 5+ years so maybe buying a solid used car is option

Are sites like cars dot com legitimate places to go?
Thx for you help.

I don't have an answer for you on that. Personally, we have only purchased Certified Pre-Owned for the past 20+ years from local dealers and have always been happy. I do all my searches online, browse through all the local dealer CPO inventory, pick out a few I'm interested in, then go and test drive and make a deal. DW is on year 6 with her CPO VW Tiguan, and I'm on year 11 with my CPO Chevy HHR.

 

[FREE866]

I don't have an answer for you on that. Personally, we have only purchased Certified Pre-Owned for the past 20+ years from local dealers and have always been happy. I do all my searches online, browse through all the local dealer CPO inventory, pick out a few I'm interested in, then go and test drive and make a deal. DW is on year 6 with her CPO VW Tiguan, and I'm on year 11 with my CPO Chevy HHR.

Thx....Problem is when I look at certified pre owned audis in her area the farthest they go back is 2018 and price is a bit too high.....

 

[FREE866]

Houses and cars are what keep most people from achieving financial independence. Leasing is a fancy word for renting. Would you rent a car for 2 or 3 years? I wouldn't.


At 21, she should be looking to buy a decent late model used car, maybe 4-5 years old, that she can keep for 10 years. Pay it off in 3 and be payment free for 7, during which time she saves up to buy a better car next time around.


Our daughter bought her first car when she was about the same age. She paid $5,000 for a 7-year old Hyundai. Kept it for 5 years and this past November she sold that and bought a 2018 Hyundai (better model) for $19,000.


Yes, I realize that there can be times when a lease seems to make sense, but very rarely if ever will it beat buying and keeping long term. I had my last car for 8 years (it was 6 years old when I bought it) and had the one before that for for 12 years (it was 1 year old when I got it).

Great points.....your daughter sounds responsible....my niece is a bit entitled and thinks hyudais are "beneath her"

ugh

 

[38Chevy454]

Great points.....your daughter sounds responsible....my niece is a bit entitled and thinks hyudais are "beneath her"

ugh

Are Audi high cost maintenance and repairs in her entitled budget? I agree an Audi is not a good first car choice. Better to get 1-3 years old used more common vehicle. But problem now is used are near same prices as new. So see what deals you can find. I would avoid Audi or German cars, for the high maintenance costs. Not that any car maintenance is inexpensive, but German cars are worse.

 

[disneysteve]

Great points.....your daughter sounds responsible....my niece is a bit entitled and thinks hyudais are "beneath her"

ugh

I hope she discovers reality sometime soon.

 

[Dean56]

Houses and cars are what keep most people from achieving financial independence. Leasing is a fancy word for renting. Would you rent a car for 2 or 3 years? I wouldn't.


At 21, she should be looking to buy a decent late model used car, maybe 4-5 years old, that she can keep for 10 years. Pay it off in 3 and be payment free for 7, during which time she saves up to buy a better car next time around.

Great advice, I agree 100%

 

[OldShooter]

She should buy only something she can afford to buy for cash. IOW live within her means. That is a learned discipline that will serve her well for the rest of her life.

 

[Qs Laptop]

Twenty-one year old niece. What you want is a vehicle with reliability and safety.

Who is paying for the vehicle? If she is a newly employed college grad, she likely doesn't have the money to buy a 5 year old used car, unless she's got $20,000. (and a 5 year old Audi would be $35K and is not the best for reliability.) But she could probably afford a $300 a month lease payment on a new Hyundai Sonata or Honda Civic. She would be building up her credit rating as well.

My oldest son was in the same spot 5 years ago. New college grad, new job out of state, no vehicle. He was looking at 10 year old Toyotas and Hondas with 150,000 miles for $8,000. That would have burned up his savings and he'd have to drive a 10 year old car of unknown reliability over 1,500 miles to get to his job. He ended up getting a new Civic for no money down and $281 a month payment. This was the best solution for us.

 

[rk911]

She should buy a vehicle she can afford with cash. No loans or leases. Invest the "car payment" $ in good, growth, low-turnover stock mutual funds. She'll thank you later.

 

[Midpack]

…

 

[marko]

We've been leasing luxury cars for 35+ years.

Our reasoning:
More car for the monthly payment, new car every 3 years (repairs on luxury vehicles are very high), latest safety technology.

Mostly, it's about more car for the money.

 

[captain3d]

Never had a car payment or a car worth more than $10k. Nothing bad ever happened and transport has been fine.

Young people should only be looking at expensive cars if they are rich or want to supply others with good used cars.

There is a grand illusion about what is an acceptable amount to spend on cars. Something similar to diamond engagement rings.

Just say no…to both [emoji3]

 

[FREE866]

Thank you for all the comments guys, I really really appreciate it.


Just to clarify....she is the one paying for this and will be paying all cash.....she came into some inheritance when her dad died last year. To the one poster, the majority of the inheritance is in VTI and a small $ in VXUS so to the best of my ability I'm trying to teach her the value of money growing.



Nothing final yet , but we will be buying a used car, not sure what make....she has a bit of , how do I say this , warped sense of reality at times, so trying to focus on car that is more practical....not easy....

 

[Qs Laptop]

Thank you for all the comments guys, I really really appreciate it.

Just to clarify....she is the one paying for this and will be paying all cash.....she came into some inheritance when her dad died last year. To the one poster, the majority of the inheritance is in VTI and a small $ in VXUS so to the best of my ability I'm trying to teach her the value of money growing.


Nothing final yet , but we will be buying a used car, not sure what make....she has a bit of , how do I say this , warped sense of reality at times, so trying to focus on car that is more practical....not easy....

If she's looking at Audi, she's probably wanting a luxury car with some cachet. If so, may I suggest a Lexus? They're much more reliable and just as luxurious. She might be able to get into a five year old Lexus for $35K.

 

[FREE866]

If she's looking at Audi, she's probably wanting a luxury car with some cachet. If so, may I suggest a Lexus? They're much more reliable and just as luxurious. She might be able to get into a five year old Lexus for $35K.

Consumer Reports really had unfavorable reliability scores on the Audi so dont think we are doing that....BMW's look very reliable per their scores...early research looks like 15 K for a 6-7 year old one

 

[Aerides]

What is her income? She can't be a snob for brands unless she has an unusually high income for a 21 year old.

 

[aja8888]

Consumer Reports really had unfavorable reliability scores on the Audi so dont think we are doing that....BMW's look very reliable per their scores...early research looks like 15 K for a 6-7 year old one

BMW's are known to generate "legendary" repair invoices!

She should stay away from anything German.

 

[Walt34]

Just to clarify....she is the one paying for this and will be paying all cash.....she came into some inheritance when her dad died last year. To the one poster, the majority of the inheritance is in VTI and a small $ in VXUS so to the best of my ability I'm trying to teach her the value of money growing.

Nothing final yet , but we will be buying a used car, not sure what make....she has a bit of , how do I say this , warped sense of reality at times, so trying to focus on car that is more practical....not easy....

Given that she's 21, and the age of majority in every state, it sounds like age 21 is a good age to let her make that expensive mistake now, when she has time to recover and realize the error of her ways.

Everyone here has offered good, sound, logical financial advice, but whether a 21-year-old is going to take that advice is a bit of a crap shoot.

But at least making an expensive mistake at age 21 will not condemn her to spending her retirement living under the proverbial bridge. Better yet, she'll learn at an early age that buying an expensive-to-buy-and-own car is not a wise investment, and that Hyundai that is so beneath her will get her there just as fast as the Audi.

 

[pacergal]

I think it depends on the person.
My BIL likes new, fancy cars, so he leases and has for years. changes out new cars every year or two.
We buy our cars, mostly new, rarely outright, but short loans, and keep for 10-15 years or more.

AT 21, I would encourage a very high rated safety car, good mileage, good quality, good re-sell value. Probably buy used, unless she has good income or plans to use some of her inheritance.
Maybe a sporty Toyota or Subaru?