Leasing a car is a popular option if you need reliable transportation and want to drive a nice vehicle while having maintenance taken care of. But there are other car leasing alternatives to consider before you sign the contract. Long term rental, buying, car sharing and even car subscriptions are all options. We’ll go over how each of these compares to leasing to help you make an informed decision.
Often when you need a car to get around every day, and for an extended period of time, you decide between leasing and buying. Leasing can be great if you want a new-model vehicle that you don’t have to worry about selling when you want something new in 36 or 48 months. Another plus is that most maintenance costs are included in the lease. However, if you drive long distances, the yearly mileage limits can be burdensome and the monthly payments might be higher than buying a car, depending on the length of the lease and other factors.
There are no mileage limits when you buy a car, and you are free to sell it if you no longer need it or for other reasons. Buying a car also gives you the freedom to make modifications to fit your needs. On the downside, you are responsible for all maintenance and repair costs. And if you are buying a new car, the depreciation can be brutal whenever you decide to sell or trade it in.
Long Term Rental
If you only need a car for several months, due to work or temporary relocation, the hassle of buying or leasing the car is likely not worth it. A long term rental can fill the transportation gap. Because a long term rental is like a traditional car rental, the paperwork and process are easier than buying or leasing. Plus, you can switch out your rental vehicle when you want to and drive something new! A drawback compared to leasing is that many long term rentals have limits on how many days you can rent at one time. So if you need a vehicle for 2 years or more, leasing is going to be a better option.
Car sharing is not widely available in the US, but if you live in a large city like Washington, D.C. or San Francisco, there should be at least one option. If you work from home or mostly use public transportation, you can save money by using a car sharing service when you need a vehicle rather than leasing or buying a car. The downside is that car sharing is not found everywhere, and there might not be a car available near you when you need one. The service is also best for quick trips, and the costs can quickly mount if you need a car for multiple hours.
The latest entrant into the alternative to car ownership or leasing is car subscription services. Like car sharing, this is only available in a limited number of locations, but might be a better option for some people than leasing. The subscription service partners with a car dealership and you pay a monthly fee that includes everything from maintenance to insurance. Everything is usually done in an app, so convenience is a factor here. Downsides are that you will probably not get a brand new car to drive, and the type of car you are qualified for is based on your credit and income. Monthly payments might also be higher than if you lease a car. You also will likely pay a fee when you first start using the service. But a perk over leasing is that you can usually return the car with just a few days’ notice if you no longer need it.