Every Wednesday, YNN’s Ed Keiner helps drivers get to know their vehicle better by providing tips on how to understand and correct your car’s mechanical problems -from changing your flat tire to jumping your car’s battery, Keiner proves to be
. Our National Automotive Correspondent, Lauren Fix, shares information on the latest vehicles and safety information in
Mondays on YNN.
Automotively Austin: Leasing vs. buying vehicles
To view our videos, you need to
install Adobe Flash 9 or above. Install now.
Then come back here and refresh the page.
You want a new car, but you have two voices in your head -- the dealership and the financial planner.
Leasing is basically borrowing a vehicle from the dealership for a few years. The dealership knows exactly when you'll be back to return it and then you can get an upgrade.
"I would prefer more customers to lease," BMW of Austin Christopher Late said. "With today's world of technology changing every month, there's always a possibility some new thing may be available in a car three years from now."
Bell Wealth Management Financial Planner Colin Bell said trading up all the time, through leasing, is not good for your bank account.
"I'm not sure it ever really makes sense to lease a vehicle. The goal is to not have a car payment," he said. "Spending money on a depreciating asset that only goes down in value is not a good use of money. It’s an extracurricular activity and it’s a hobby."
Instead, Bell says take care of your purchased car and keep it for a long time.
"Paying cash makes you scrutinize every single option that you select and really allows you to determine what you can afford and what you cannot afford," Bell said.
If you can't pay off that brand new car quickly and it's totaled or stolen, you could be in big trouble if you don't get gap insurance to cover the gap between what the car is worth and what you owe on it. Most leases include it, and if you lease, you'll most likely always have free maintenance.
"Your oil changes, your brake jobs, your windshield wiper blades and the typical fluids in your car," Late said.
Leasing brings in 40 percent of BMW of Austin' business, but every dealership has its own trends.
At Leif Johnson Ford, leasing versus buying depends on the type of car you're looking at. People tend to buy trucks, because there's no tax-free lease and they usually get a lot of wear and tear. People also tend to buy the smaller cars because of their affordability. Leif Johnson Ford says they tend to lease higher-end vehicles to bring down the monthly payment.
Late said leasing means more flexible terms while Bell said with buying, the goal is to pay cash or pay it off as quickly as possible.
Stop by YNN's booth at the 2012 Austin Auto Show. “Your Driver's Ed," our own Ed Keiner, will be there to answer all your car questions.
The event will be held at the Austin Convention Center Friday and Saturday 10a.m. to 10 p.m. and Sunday 10 a.m. to 6 p.m.