Buying a car is one of the most expensive purchases of your life, hence it is extremely essential that you refer to all the options carefully and draw out the disadvantages and advantages of each so that you can come up with the best option. Most people tend to get confused between buying a new car and leasing it. However, there are pros and cons of both the options. Many factors are to be studied to draw put conclusions and to know which option is the best one.
If you are planning to lease your next car then you must check out the option of contract hire cars. However, you must figure out some of the factors. In this article, we will be discussing all about the factors which you must keep in mind when buying or leasing your next car.
What is meant by leasing a car?
Most of the buyers are not even aware of the fact that one can even go for contract hire cars just like they lease out their property. This means that the financer of your car will purchase the car on your behalf and you will have to pay the financer back through monthly rents.
Know all the factors which you must consider when buying or leasing a new car
There are various factors that must be kept in mind when buying or leasing your brand new car. Some of the most important ones have been mentioned below
- Your monthly income – when you are leasing a new car, you will have to pay the rent monthly. Hence, make sure that you have enough monthly income to pay the rent.
- Your savings – you must have some savings so that you are able to pay for the down payment.
- How much you drive? – Much of the rent will also depend on how much are your driving the car. If it is more, then you will have to pay extra.
- How you handle it? – If you are more prone to cause damage to your car, then you will have to pay more.
Leasing will involve a lot more work than buying.
There are investments and then there are some classic investment mistakes. Many investors commit some common investment mistakes while making investment decision in various instruments and areas such as real estate, stocks and bonds, and even historic cars investments. Historic cars are one such investment option which needs thorough study, since it might involve spending huge sum of money on classic cars that very few desire and buy. Here are a few mistakes to avoid when planning investment.
- When you plan to go for historic cars investments, you need to be careful about the calculation of your investment decision. Many investors run after hot tips and end up spending a huge amount of money on classic cars that they are unable to sell later. However, a proper buying and selling strategy needs to be in place right from buying classic cars to selling them to the right people. Car investment should be based on the classic car market earning and anomalies forecast.
- Before making any investment decision, you need to consider the risk tolerance as well as the investment time horizon. Once you purchase a classic car, you will be tied up with the asset for a while before selling it off again. The shorter this time horizon the better for your finances. Keeping a classic car for longer means paying for its maintenance and keeping it in good condition all the time. Ensure that your investment choice meets your risk tolerance You also need to understand the investment’s price volatility and a clear understating of what you are getting into.
- It is always advisable to figure out your exit strategy, before making an investment. Ideally, one should consider several criteria that might compel one to sell the asset before you are ready. Factors such as price fluctuations, asset degradation etc. might cause you to sell classic cars before you want them to. You need to keep your investment strategy in place and ready for eventualities before making an investment decision.
If you are simply a collector who likes to invest in historic cars in terms of personal usage and collection purposes, you have nothing to fear. If you have the money and the love for classic cars, go ahead to enhance your collection.