Owning a car is a dream come true for many Singaporeans. However, the money required to buy and maintain a car in Singapore can be a significant financial burden. As such, many people are considering leasing a car instead of buying one. Here’s a helpful article about leasing vs buying a car in Singapore.
Leasing a Car
Leasing a car is essentially renting a car for an extended period. You pay a fixed monthly fee to use the four-wheeler, and at the end of the lease term, you return the vehicle to the leasing company. Leasing is an attractive option for those who want to drive a car without the hassle of owning one.
Pros of Leasing a Car
Lower Monthly Payments
Leasing a car can be cheaper than buying one. The monthly leasing payments are typically lower than that for buying a car, especially if you factor in the high down payment required for purchasing a car in Singapore.
Leasing a car means you don’t have to worry about maintenance costs. The leasing company manages all the servicing and repairs, so you don’t have to worry about unexpected repair costs.
Upgrade Your Car Frequently
Leasing a car allows you to upgrade your vehicle frequently. You can return the car and rent a new one at the end of the lease term.
Cons of Leasing a Car
Leasing a car comes with mileage limitations. If you exceed the mileage limit, you will have to pay additional charges.
Leasing a car means that you don’t own the four-wheeler. It can be a problem for those who like to have a sense of ownership and control over their assets.
Penalties for Damages
You will have to pay penalties for any damages to the car beyond normal wear and tear.
Pros of Buying a Car
Buying a car means you own the vehicle and have complete control over it. You can modify it as you please and use it as much as you want.
No Mileage Limitations
There are no mileage limitations when you own a car. You can drive it as much as you want without worrying about additional charges.
When you buy a car, you build equity. You can sell the vehicle later and recoup some of the costs.
Cons of Buying a Car
High Upfront Costs
Buying a car requires a high upfront cost. The down payment and the price of the vehicle can be a significant financial burden.
When you own a car, you are responsible for all the maintenance costs. It can cost a hefty amount.
Cars depreciate over time. When you sell the car later, you may be unable to recoup all the costs.
Which is Best for You?
Deciding whether to lease or buy a car depends on your situation. If you value convenience and want lower monthly payments, renting a vehicle may be best for you.