Leasing vs. Buying a Car: Key Insights to Consider Before You Decide

Deciding between leasing or buying a car primarily depends on your intended duration of ownership. Navigating the car-buying process can be daunting. From understanding dealer fees to resisting sales pressure and determining essential features, it often feels like a foreign language the moment you step onto the dealership floor.

Despite women making most car-buying decisions in the U.S., many still feel excluded from the conversation. We’re encouraged to trust our instincts, but with significant financial implications, that approach can seem precarious.

To clarify this process, we consulted Chaya Milchtein, an automotive expert and author of: “Mechanic Shop Femme’s Guide to Car Ownership,” who breaks down the essentials of leasing and buying a vehicle, including considerations for electric cars and how to approach a dealership confidently.

Whether your current vehicle is nearing its end or you're just starting to explore, here’s what to keep in mind before making this major financial commitment.

Why Opting for a Used Car May Be the Smartest Choice

Expert: Is purchasing a used car typically a wiser choice than buying new, or does it depend on individual circumstances? How do you determine this?

Chaya Milchtein: Choosing a used car can definitely save you money. Currently, the average cost of a used vehicle is around $30,000, compared to nearly $50,000 for a new car, making used cars more budget-friendly. However, the best choice depends on your personal needs and circumstances.

Some vehicles, such as Subarus, may not offer significant savings when bought used compared to others like Volvos or luxury models, which tend to depreciate more sharply.

Your decision should factor in:

Your budget for the car.
How long you plan to keep it.
Your willingness to manage potential issues with an older vehicle sooner rather than later.

So, is it cost-effective to buy used? Definitely. For most buyers, opting for a used vehicle is a sensible choice.

Should You Lease or Buy an Electric Vehicle?

Expert: If I’m considering an electric vehicle, is leasing or buying the better option?

Chaya Milchtein: Leasing can be more beneficial than purchasing an electric vehicle since the technology is evolving rapidly. In three years, the EV options might be far superior to what's available today.

Additionally, electric vehicles experience steep depreciation. Buying one often results in a larger depreciation hit compared to leasing. Remember, leasing also gives you the option to purchase the car at the end of the lease if it fits your needs perfectly.

Negotiating at the Dealership: Enter with Confidence

Expert: What’s the current state of negotiations at dealerships? I’ve heard that with so much information available online, negotiating isn’t as intimidating as it once was. Is that accurate?

Chaya Milchtein: Walking into a dealership can be daunting, especially when the staff may not prioritize your best interests, aiming instead to maximize their profits.

Preparation is your best ally when entering a dealership. Make sure you: