Should You Rent or Purchase a Car?

The younger generation is gradually moving away from an owned economy and into a “sharing” economy around the world. Automobiles are the same way. For urban professionals who depend on rental cars like a self-drive car hire Rwanda, the expense of owning a vehicle is becoming increasingly burdensome. Not only for city drives but also weekend getaways and holidays, people are renting cars on the highway.

You could be considering whether to purchase or lease a new car if you’re in the market for one. It’s a significant decision. A new car is the second most expensive purchase most people will ever make, after a home.

Here are the benefits and drawbacks of leasing vs. owning a vehicle to help you navigate this milestone:

The advantages and disadvantages of leasing a car

Pros:

• There is no or a small down payment needed.
• Typically, warranty coverage is given.
• Payments are lower each month.
• There are no sales taxes to pay upfront.
• There are no questions about depreciation.

Cons:

• Fines for excessive mileage
• Excessive wear and tear charges
• Fees for breaking a lease early
• Insurance rates are generally higher.
• Payments are made every month.

If you want to drive the newest models all of the time but don’t have the credit or money to purchase one, leasing might be a good choice.

The advantages and disadvantages of purchasing a vehicle

Pros:

• • • Eventually owning a vehicle
    • There are no mileage restrictions.
    • Customization/modification options are available.
    • Insurance premiums are generally smaller.

Cons:

• • Resale value is unpredictable.
  • Car loan payments are increasing on a monthly basis.
  • Maintenance costs after the warranty have expired
  • Over time, it depreciates.
  • A large deposit is needed.