Start by figuring out your budget, taking into consideration the cost of
insurance, maintenance and gasoline, which typically run higher for luxury brands.
May 14, 2006 (Press Release) --
Tips On Getting Started
• Start by figuring out your budget, taking into consideration the cost of
insurance, maintenance and gasoline, which typically run higher for luxury brands.
"All auto-related expenses should stay in the 10% to 15% range of total monthly
living expenses," counsels Diahann W. Lassus, a CPA and certified financial
planner with offices in New Jersey and Florida.
• Pick a realistic target price for your vehicle, and don't forget to add on sales
tax--in the 5% to 8% range in many states. The ForbesAutos.com Loan Calculator can
give you an idea of what your monthly payments would be at an average loan rate.
• Decide whether you want to purchase the vehicle with cash or take out a loan, or
you may simply opt to lease. If you are considering a cash purchase, remember to
calculate the earnings you would lose over the three- or four-year term of an auto
loan if you went for that option instead. Look at whether you would keep that
money in a bank or in a higher-rate investment, and then calculate your probable
interest earnings at that rate. But with interest rates still extremely low on
bank savings accounts and brokerage money market funds, the cash alternative might
look more attractive than it would when those rates were higher.
• If you use your car for business more than half the time, leasing may make it
simpler to take business deductions. Business owners or anyone else who uses his
or her car for business can deduct the portion of the lease corresponding to
percentage of use for business. This is probably simpler than ownership, but does
not actually save money compared with the depreciation schedule allowed for car
owners who use the vehicle for business.
A choice to lease or buy with a loan is largely one of personal preference and
driving habits. If you typically trade for a new car every four years or less,
drive less than 12,000 miles a year (the usual lease allowance) and keep your
vehicle in good condition, you may be a good leasing candidate. Especially among
luxury brands, the best deals often are the ones from the company's finance arm.
Because they prefer promotional leases to giving rebates, companies such as BMW,
Lexus and Mercedes-Benz often will offer leases that have low interest rates,
above-market residual values or both. The result: lower monthly payments. Whether
you are going to purchase with an auto loan or lease a vehicle, here are some
things you need to consider.
Source: http://search.msn.com
by Jerry Edgerton
• Start by figuring out your budget, taking into consideration the cost of
insurance, maintenance and gasoline, which typically run higher for luxury brands.
"All auto-related expenses should stay in the 10% to 15% range of total monthly
living expenses," counsels Diahann W. Lassus, a CPA and certified financial
planner with offices in New Jersey and Florida.
• Pick a realistic target price for your vehicle, and don't forget to add on sales
tax--in the 5% to 8% range in many states. The ForbesAutos.com Loan Calculator can
give you an idea of what your monthly payments would be at an average loan rate.
• Decide whether you want to purchase the vehicle with cash or take out a loan, or
you may simply opt to lease. If you are considering a cash purchase, remember to
calculate the earnings you would lose over the three- or four-year term of an auto
loan if you went for that option instead. Look at whether you would keep that
money in a bank or in a higher-rate investment, and then calculate your probable
interest earnings at that rate. But with interest rates still extremely low on
bank savings accounts and brokerage money market funds, the cash alternative might
look more attractive than it would when those rates were higher.
• If you use your car for business more than half the time, leasing may make it
simpler to take business deductions. Business owners or anyone else who uses his
or her car for business can deduct the portion of the lease corresponding to
percentage of use for business. This is probably simpler than ownership, but does
not actually save money compared with the depreciation schedule allowed for car
owners who use the vehicle for business.
A choice to lease or buy with a loan is largely one of personal preference and
driving habits. If you typically trade for a new car every four years or less,
drive less than 12,000 miles a year (the usual lease allowance) and keep your
vehicle in good condition, you may be a good leasing candidate. Especially among
luxury brands, the best deals often are the ones from the company's finance arm.
Because they prefer promotional leases to giving rebates, companies such as BMW,
Lexus and Mercedes-Benz often will offer leases that have low interest rates,
above-market residual values or both. The result: lower monthly payments. Whether
you are going to purchase with an auto loan or lease a vehicle, here are some
things you need to consider.
Source: http://search.msn.com
by Jerry Edgerton
Email
Print
SPAM
LEAVE A COMMENT
