Making a decision on whether to buy a new, old or lease a car is one of the toughest decision people are making today. Both benefits and limitations comes with each of these models that one chooses to use in acquiring a vehicle. Mostly, whether to buy a new, old or lease a car depends with a number of factors and conditions in the life of an individual. While a lot of benefits such as reduced costs of monthly payments are related with leasing versus buying a new car and an old car demand less money, I would prefer to buy a new car.
The main difference between buying a new, old or leasing a car comes with the type of ownership and length of use. Leasing involves getting permission to use a car without owning it. Buying a car on the other hand will give me ownership of the car. This option of buying gives the owner an opportunity to add to my security which can even be used to get a bank loan ( Education, 2010) . However, the length of ownership may be affected when the car is old. An old car will soon develop challenges that lender it useless.
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The second difference between leasing, buying a new or an old car is the limitation on car mileage. A lease car comes with mileage limitation which one must observe. Exceeding of on a leased car mileage comes with additional charges ( Ward, 2019) . On the other hand, buying does not come with a mileage limit. Mileage may also be limited if the car is old. After running a few miles, an old car will develop mechanical and other challenges that may lender it useless to the owner.
When it comes to the use of the car, there are differences in how a car can be used including customization to suit individual needs. One can customize a vehicle if they have purchased (Delbridge, 2019). Customizations can happen regardless of whether it is old or new. Such customizations may include adding stereo or boosting the engine power. On the other hand, a car on lease cannot be customized as the requirement is that it be returned in the condition given by the company.
The other difference between leasing, buying a new or an old car include the up-front costs. Buying has higher upfront cost than leasing. The costs are higher in a new than an old car. Buying costs include down payments, registration, taxes and other fees that will ensure the ownership (Gutiérrez ‐ i ‐ Puigarnau & Van Ommeren, 2011) . For an old car, the up-front cost include that of renovation of parts that may be damaged. On the other hand, the upfront cost of leasing are few and mainly include monthly payments. However, in the long run, leasing results in a high cost as one will pay for as long as the use the car. On the other hand, buying a new car will only involve paying for an average of five years then the car is yours.
Another important feature that should be considered is the case of early termination. In case of early termination, the owner of a car can only sell it in order to pay for remaining amount of instalments. The cost of the car is higher when it is bought new than old making it easy to terminate with a new than an old vehicle. On the other hand, and end of the lease will only mean that the individual stops paying with no more consequences ( Ward, 2019) . The dealer will have to return all the upfront costs such as security. This characteristic offers benefits to the leasing over buying either a new or an old car.
In this case the main determiner of whether to buy or lease is the amount of money provided by the company for the purpose of acquisition of the car. The amount given, $3000 could be enough to pay for either lease or purchase of a new or an old vehicle. Most dealers in the US allow pay between $2500 and $10,000 for a new car depending on the model ( Peñaloza & Barnhart, 2011) . On the other hand, it is hard to get an old car that is sold in hire purchase terms hence the $ 3000 may not be enough.
In conclusion, the decision to buy is more attracting than leasing a car. While leasing involves less monthly instalments than buying, it is expensive in the long run. Further, buying a new car offers more advantages than leasing. Moreover, the amount of money provided by the organization is enough for either buying a new car instalments or leasing of the car but may not be suitable for buying an old vehicle. Therefore, to enjoy the benefits of owning a car, I would opt to buy a new one rather than lease or purchase an old vehicle.
References
Delbridge, E., (2019). Pros and Cons of Leasing vs. Buying a Car. The Balance. https://www.thebalance.com/pros-and-cons-of-leasing-vs-buying-a-car-527145
Education, M. T. (2010). Cars.
Gutiérrez ‐ i ‐ Puigarnau, E., & Van Ommeren, J. N. (2011). Welfare Effects of Distortionary Fringe Benefits Taxation: The Case of Employer ‐ provided Cars. International Economic Review , 52 (4), 1105-1122.
Peñaloza, L., & Barnhart, M. (2011). Living US capitalism: The normalization of credit/debt. Journal of Consumer Research , 38 (4), 743-762.
Ward, W., (2019). Leasing vs. Buying a Car: Which is Better? Creditiful. Retrieved from https://www.crediful.com/leasing-vs-buying-a-car/
