Is this a good lease deal??

Ever heard of "cash," and if you don't have enough of this thing called "cash," you can't afford a new man toy?

 

without even looking at the numbers, you say you put 6k a year of mileage. that pretty low. the national average is around 12k a year.

 

No such thing as a good lease! It is the most expensive way to operate a vehicle!
If it's going to be sitting most of the time rent or buy used 100% down aka no payment! Leasing would be a pretty expensive driveway ornament.

 

Yeah right...if that was the case, no one would own cars or houses. That's not the reality for most of us.

 

Seriously. Not all of us have our mommy and daddy trust fund hand me downs.

 

HAHA I love hearing all the lease bashing from people who dont understand money and just base it off "I own my truck not lease". I have leased because I got a MUCH lower interest rate to the point it was cheaper to lease and buyout after 4 years then to buy it out right. (I know its a bit different in the US vs CAN) but when you lease here, you have the whole portion of the lease (buyout) sitting there not accruing interest. You basically get 0% interest loan for the amount of the lease, then decide how you will pay for it when the buyout comes. Leasing saved me over $2000 in the end of my payments, and I gained even more by dumping a few hundred into a mutual fund and direct investing stocks every couple months and saving it to use on the buyout.
So there are many factors in the Lease/Buy options.

 

That might be the dumbest post of this thread. I'm not one to usually bash someone but come on... seriously???? Who the hell has 30K just sitting around? My wife and I make plenty of money to be comfortable but I don't know anyone that can just go out and pay "cash" for a new vehicle much less a Tacoma. If you can then more power to you but don't assume the rest of us can. Really, really dumb post....

As to the OP. If you think the lease is the best route then that is your decision. It wasn't for me but I plan on keeping the truck till it turns to dust. Good luck either way.

 

THIS- Plus, a lease is just a 3 year note with a balloon on the end. residual at the end of my deal is 21k. If my truck is worth 25k, I can trade it on something else, buy it out right for 21k, or turn it in.

 

Obviously a roof over your head is more necessary for survival and well-being than a 30K pickup truck. A house also stands a good chance of appreciating in value, a pickup truck does not.

We don't have trust funds and we do have a mortgage on a modest house that costs less per month than my dumb-ass brother in law's diesel truck payment.

We didn't have 30K for a new Tacoma, but we did have enough for a decent used one after carefully saving for several years (blasphemy!). I am a mechanic and my wife works part-time. If we can do it on our humble salaries, anyone can.

 

Kudos to you for living within your means. But you came across as a condescending DB with your comment about a "new man toy".

The vast majority of us financed our vehicles (myself included). As I said before, my wife and I are lucky and make a good living and we live within our means also. We have a house payment and 2 vehicles and that is it besides utilities. I financed my truck with 0.9% interest so most of my 36 monthly payments go towards the principle. It didn't make any sense for me to take money out of savings, stocks, or lower my deferred comp. to buy my truck. So your "cash" system doesn't always make the best financial sense.

As far as the OP goes, If he wants to trade vehicles every 3 years then Leasing (renting) his vehicle "might" make the best sense for him. I personally wouldn't dream of doing it but that is my "opinion". It just wouldn't work for me.

 

At 6k per year, a lease is not a bad option. As Taco said, the value of the truck at the end is higher than the residual, so it's not a bad deal.

The killer for most people on leases is mileage.
I run 20-30k per year. While you can buy extra miles up front, it doesn't change the fact that the base lease payment is based on 12k-15k per year and those extra miles are expensive. By the time you get into a lease where you are prepaying for 18k or more, it's cheaper (monthly) to finance.

Another thing to keep in mind is insurance.
When leasing, the leasing companies require maximum liability coverage. That means a 250/500 policy in California, which will run you about $150/month more than a minimum 30/60 policy.
So at least in California, unless you are already carrying max liability, just the insurance covers the difference between the lease and financing.

Leasing is good for people who:
Run low mileage
Typically carry max insurance coverage
Prefer dealer service
Want a new vehicle every 3 years
Don't modify
Don't offroad

Or... Your company is paying for it.

 

^Bingo!

 

Well, the dude's already got an RV and a '55 Ford Fairlane. A financed new Tacoma on top of all that is the epitome of a man-toy.If you have the income and OWN your man toys, I'm happy for you and I'm jealous. Maybe even intimidated. But for most people with big houses, new vehicles and cool toys, their wealth is just an illusion. It's ironic that saving money and not buying luxuries you don't need makes you look less wealthy than those who finance new cars and man toys to show off in their driveways. If you can find an instance where paying cash costs more over time than financing, you must know something that Warren Buffett and Dave Ramsey don't.

 

0% financing cost the same as cash. I came damn close to it. I agree with some of your points. Your first delivery was the issue.

 

the hard part is figuring the depreciation on the purchase over three years. there are several sites that give estimates (i.e. edmunds) as far as the % you lose when you drive off the lot, mileage, etc.

 

also, i saw in one of the ops posts where he wants to lift it... i wouldnt want to do any mods on a truck that i knew i was turning in, but thats just me.

based on everything, it seems to me that the op "wants" a new truck regardless of a bunch of other factors. if he is dead set on spending $XXX each month and wants to get the most bang for the buck and understands the difference where he would be in 3 years lease vs. buy on the same vehicle (the dealer will tell you the residual based on the end of the three year lease based on assumed mileage, he may actually beat that value) and look at 3 year old trucks on the lot/ online to compare.

either way, i would suggest buying a used older truck. Op is planning to pay like $50/ day for when he is actually using it. or he could be halfway home to buying an older 90 model tacoma which would still be badass...

 

There are times when I have leased vehicles when I wasn't sure if I wanted to own it long term. I would always put zero or minimal down though. If the truck gets totaled you will lose whatever you put down on it. I wouldn't lease a Tacoma though.

The best way to lease if you know you will be turning it in is look for deals on zero down and low monthly payments. In that case you don't care if the buy out is high. The problem is there are rarely those great lease incentives on trucks. They always want like $3,000-4000 cap cost reduction. Maybe because they know they get "abused" more since they are often used of work.

 

excellent points. I did not realize the insurance part as its not different here. Although I modded and do the occasional weekend offroad with mine and its never been an issue

 

Spending anything on mods on a lease vehicle to me just seems like a total waste of money.

 

Leased or financed, you are only paying for mods for the next owner... it's the same as buying implants for your girlfriend or wife.

The difference between buying and leasing is whether those mods go to the next owner in less than 3 years or more than 3 years.

For me, I'm usually getting a vehicle just to where I like it in 3 years.