When I chose to lease a new Volkswagen Jetta,
I thought my decision was smart...
But once I decided to trade it in early,
the truth was I'd thrown out my car.
The Backstory:
When I leased a new VW Jetta in 2016, I traded my fully paid-off 2007 Honda CR-V because the salesperson I was working with said that the Honda was unsafe.
How was it unsafe? Well, during a particularly nasty snow storm, I slid into a curb and messed up my alignment. Thus, I immediately took the Honda to Les Schwab and told them what had happened, and they “fixed” my car. But that’s the thing. I’d paid to fix it and it hadn’t actually been fixed. So, all those years when I’d been driving around thinking that my car was fine, the tires were scraping against the inside of the fender. Not good.
At the Volkswagen dealership, I remember being hysterical when he showed me that my my Honda was dangerous. And I felt so thankful that nothing had happened that I didn’t take the time to think about getting the Honda fixed correctly, I just became hysterical and traded it in out of fear.
2017 VW Jetta
Looking back now, my decision was ridiculous. It was based on feelings rather than facts. The fact was that my Honda CR-V was superior to the VW Jetta, no matter how new the Jetta was.
What should you know before leasing a car?
These are the things you need to have in order to lease successfully:
1. Financial Security
If you are in debt,
leasing is not for you.
The problem you’ll run into is that you are so busy paying off school, credit cards, furniture, houses, etc. that you struggle to make car payments – not to mention, you don’t have extra money to save for a deposit on a new car.
During my most recent Dealership experience, I was told that the people who utilize the leasing option well are those who can afford the constant car payments.
2. Short Driving Distances
If you love to drive,
leasing is not for you.
The miles you initially agree to are limited to 30,000 or 45,000 for three years. This may have changed since 2016, but at the time, those were my options, and they told me to start small and add on later since it’s better to not have extra miles that you don’t use.
About halfway through my lease, I received an offer from Volkswagen to buy more miles. But after doing the math, I realized that paying in full for those extra miles wouldn’t save me money by the end of my lease.
3. Know What You Want in 3 Years
If you don’t love the car or don’t want to trade it in for a new lease,
leasing is not for you.
The minute you drive off of the lot with that car, the value is sliced in half. As you add miles and wear-and-tear, the value only continues to decrease. By the end of your lease, if you want to keep the car, you’ll end up refinancing it for an amount that is higher than what it’s going for on the market.
If you continue to lease new cars, the interest rates are lower and you can keep leasing forever. But, if you don’t want to lease, you need a decent deposit saved for a new or used car. Honestly, the truth is that if you have no idea where you’ll be in 3 years and you don’t feel 100% certain about your income, then leasing is not for you.
Take the time to look at the facts:
study your spending behavior,
review your daily activities for travel time and distance.
Kiminy Cricket 