Yahoo! Finance Search - Finance Home - Yahoo! - Help

 Personal Finance Special Edition
Finance Home > Money Matters > The Buy vs Lease Decision > Buy "New Used" Instead

Buy "New Used" Instead

A Suze Orman exclusive

So do I think the best financial move you can make is almost always to buy a car instead of leasing? You bet I do. In fact, if you are cutting it close financially, you should strategize a step further: buy a new car but make sure it is used. Let me explain. New cars depreciate 20 percent to 30 percent the second you drive them off the lot. So if you really want to be smart, make someone else's mistake your lucky day. Buy what I call a new used car - a vehicle that is one or two years old, but has been well-maintained and doesn't have a ton of miles. It's just like new, except that its price is more like a used car. Once you own that car, own it for as long as you can. There are so many advantages to owning a car for a long time. Your insurance will be lower, DMV fees may be less, and it is easier to forego the expense and bother of cosmetic repairs for every little scratch or ding.

Speaking of repairs, I imagine some of you right now are about to launch the "repairs on old cars are too costly" argument. Come on. Even if you sink $1,000 a year into your "old" car for repairs and maintenance, that's still better than the $4,000 or $5,000 a year you would shell out for leasing a new car.

Your Driving Test
Before you lease a car, please ask yourself the following questions:

  • Do I really need a new car right now, or do I simply want a new one because it is fun and I think I deserve it?
  • If I didn't lease (or could put off buying) a new car right now, can I think of any uses for the money I didn't spend which would significantly improve my finances?
  • If I decide I really want to lease a car, why am I insisting it be such an expensive car? Who am I trying to impress, and why?

You can also give yourself a math quiz. The car experts at have plenty of information to help you weigh whether leasing makes sense, including a nifty calculator that will estimate the cost of buying vs. leasing.

The Stupidest Financial Mistake I Ever Made
And just so you know, whenever I am asked what is the most stupid financial move I ever made in my entire life, I don't have to think very long. It was when I leased my 1987 730i BMW. I leased because I wanted to impress my love interest at the time with this fancy-schmancy car that I couldn't afford to buy. And the fact that I couldn't afford it was about the last thing I wanted anyone, let alone my partner, to know. It was stupid financially and emotionally. I was trying to impress people rather than do what was right for me. I have learned plenty since then. Including how important it is to be honest with yourself so you don't end up in a financial mess. Owning up to the truth of your personal situation can give you a great new lease - on life - which is the only kind of lease I would ever recommend without reservation.

< Prev Next >

Previous Article: The Emotional Leasing Pothole
Main: The Buy vs Lease Decision

 Yahoo! Finance - Auto Loan Center
Auto Loans on Yahoo! Finance
·  Car Shopping Checklist
·  New Or Used: Understand the Differences in These Markets
·  Dealers Have Trade Secrets to Get You to Buy
·  Calculator - Finance vs. Cash
More on Auto Loans ...
 Yahoo! Autos
Save money on your new car
Get competitive price quotes from dealers near you. Just select your vehicle and enter your contact information:
ZIP Code:

Used Cars
Sell your car, Buy a used car, Blue Book prices
 Will & Trust Software
  Suze Orman's New
Will & Trust Kit

Create your own will & trust now - with personalized documents worth over $2500.

Only $13.50 plus S&H

 New Content from Suze Orman
amzn_cover.gif Are You Young, Fabulous but Broke?
Then Suze's new book is for you!
Get free downloads of great advice from the book!
·  Excerpts from "Career Moves"
·  Excerpts from "Save Up"
·  Excerpts from "Love & Money"
 Previous Money Matters
Buying the Right Car Insurance
·  Drive the Right Deal
·  How to Downshift Your Overall Costs
Debt-Defying Moves
·  Do You Know the Score?
·  Who, What and Why of FICO
·  How Much Money Does a Good FICO Score Save Me?
The Buy vs. Rent Decision
·  The True Cost of Home Ownership
·  How to Tell if You Can Really Afford to Buy
View All Topics...
 Article Tools
·  Email this article to a friend
·  Print this article
·  View Spanish translations of Money Matters on Yahoo! Finanzas en Español

Copyright © 2017 Yahoo! Inc. All rights reserved. Privacy Policy - Terms of Service
Copyright © 2017 Suze Orman All Rights Reserved.

Questions or Comments?