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ACCOUNTANT EXPLAINS Should You Buy, Finance or Lease a New Car



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If you are in the market for a car – you probably asked yourself whether buying vs. leasing is the best option. Or more importantly, what is the best option where you can really get the biggest bang for your buck? In this video, we are going to go over the three main ways to purchase a car, the cheapest option, and as well as important considerations you should know. So, let’s get right into it!

00:00 Intro
00:33 Main Options
01:32 Cheapest Option (Calculations)
11:09 Other Considerations
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Gabrielle is a CPA and Tax Expert, as well as the founder of Balance + Wealth CPA, a licensed CPA firm that specializes in Tax. Prior to starting her business, worked as a Tax Manager at one of the Big 4 Accounting Firms for 7+ years, working with Fortune 500 companies. Gabrielle posts weekly videos on personal finance, business finance, and tax tips.
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Disclaimer: Note this video is not financial nor accounting/tax advice and should be used for entertainment purposes only. Consult with your own financial advisor, accountant and/or tax advisor for specific advice related to your business situation and needs.

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37 comments
@VanCityDLLM

Lease new car advantage – write off a portion of lease payments if you have a business and FULL Warranty for the duration of your lease.

@matthewstolmeier752

Don't buy new.
The depreciation is out of control.

@rogerdeschamps5464

my lease was only 4.5% not 8% so that changes considerably

@jimflem273

Wouldn’t there be an opportunity cost associated with financing? With respect to insurance coverages specifically? With cash you get the choice to select lower coverage options, financing and leasing you are rolled into higher rates. Would this be a factor to consider? (Simply curious, my background is not finance)

@MuzixMaker

You forget inflation and depreciation. For a lease you need to amortize a down payment plus lost opportunity over the term for your real monthly rate.

@MuzixMaker

Take the cash you would have traded for the car and invest it in high dividend ETFs. Use the distributions to pay a loan or lease payment. You’ll always be driving a new car under warranty.

@minzhu9528

in fact so many uncertains should be considered when calculation, e.g warranty… so hard to say which one is expensive or not

@minzhu9528

1.99% financing cost if pay monnthly, the actual cost should times 1.8-2.0X