The decision to buy a car is the second most important financial choice a person can make. There are a few options for vehicle financing. Since most people don't pay cash directly for their vehicle, deciding whether to buy or lease a car can be overwhelming, intimidating and/or confusing. Several elements come into play when deciding whether or not leasing is right for your financial situation and lifestyle. Because the average consumer is not informed about the benefits of leasing a vehicle, sometimes leases are not even considered an option. I hope to highlight the value of leasing a vehicle and additional drawbacks when it comes to purchasing one outright. When you lease a vehicle, you can get more for your investment; Which means more features and amenities from a higher trim level. Monthly payments are typically lower because you only pay the vehicle's depreciation over the specified lease term and not the actual sales price. ***For example, on a $40,000 car, you would finance the entire $40,000 purchase price with an auto loan; with a car lease, you would only pay a percentage of that. The residual value of the car is the expected value of the vehicle at the end of the lease. The residual value is taken from the purchase price, and the difference is what you make payments on. So, if the car's residual value is 55% after three years, for example, that means the $40,000 car would be valued at $22,000 at the end of the lease. Lease payments would be calculated based on the remaining $18,000, not the full $40,000, along with interest, taxes, and fees. Leasing may also be a better option if you don't have a lot of money saved for a down payment. Usually a tenant requests a “kick-off” or...... means of bonds......paper arities. To reduce your payments without having to put down more money, some lenders stretch your loan to a longer term. Car loans can last up to five or six years! Additionally, the longer the term of the loan, the more interest you will ultimately pay. Worst case scenario, when the car is finally all yours and the lender is paid in full, you will have paid a lot of interest, you will have a seven-year-old used car with over 100,000 miles on it, and you will most likely have your bills fixed. When making the decision to buy or lease a new vehicle, it's important to weigh all the pros and cons of each possible option: budget, driving needs, lifestyle and, most importantly, your credit history. Leasing may not suit everyone's driving needs, but more people might opt ​​for it if they knew how much they could save and/or benefit from the alternative route.