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Buy or lease? It's the question I get asked most often by people who aren't car experts.

I've offered some convoluted and customized responses in the past, but over the last year or so, I've concluded that you can deal with this inquiry by applying a simple rule.

Here it is: Don't buy a car if all you want is transportation.

Explaining the rule is a bit more complicated.

If you buy a new car, you're buying both an asset and a depreciating asset. There's no such thing, for the most part, as a car that will be worth more in the future than you've paid for it (usually with an auto loan, which means principle plus interest of five years or more). Stuff like collectible Ferraris are an exception. But the price of entry is of course in the hundreds of thousands. And you have to wait for that vintage value to develop. For, like, 30 years.

So you buy an asset that you won't own free-and-clear for half a decade, but in the time that you work on that goal, you still have to pay the insurance and the upkeep.

Anyone who buys a good modern car can, however, expect that car to perform quite capably for 200,000 miles — years beyond the life of the loan, meaning no monthly transportation cost beyond the insurance (payment go down as the car get older, in many cases) and occasional maintenance (brakes, tires, oil changes, etc.).

In my experience, this group of people really like their cars and derive pleasure from owning and maintaining them.

The case for leasing

If, on the other hand, you just need to get around — commute for work, motor kids to school, whatever — leasing is a far better option.

You won't face much in the way of maintenance costs (regular car washes are about it) and after the lease is up, you can either decide to buy the car, paying a reduced price, or roll into a new lease on a brand new set of wheels.

This group of people often don't care much about what they drive as long as the vehicle gets the job done and fits within their monthly transportation budget. If they do care, they generally like luxury vehicles, and leasing actually helps them to drive more cars that would be out of their budget to purchase.

Yes, they could be lifelong leasers. But they'll always be getting their transportation needs met with the best, safest, most technologically up-to-date, luxurious, and fuel-efficient vehicle.

So there you have it. All you have to do when confronted with the buy-or-lease conundrum is decide which type of person you are — a car lover or someone who just needs basic transportation — and you'll have your answer.

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