Stop Overpaying for Cars! Buy, Lease, or Finance: The Real Truth! #Finance

if I told you that most South Africans overpay when buying a car sometimes tens of thousands of rents whether you are thinking of buying leasing or financing your next ride I’m going to show you how to make the smartest choice and avoid those costly dealership traps stick around

because this could save you a fortune let’s dive in first things first let’s quickly break down the main options you have here in South Africa we all know the big Banks like Absa Standard Bank and West Bank dominate The Car color: #1a73e8; text-decoration: none;">Finance Market they offer variety of ways to get behind the wheel but are they always the best deal let’s see one buying outright you pay the full price in cash and drive away without worrying about monthly payment or interest this might seem like

the best way to go but not everyone has 500,000 or more lying around two financing this is where most South Africans find themselves you put down a deposit typically around 10% and none;">Finance the rest with interest rate currently sitting around 11.75 your monthly payment can quickly add up three leasing now leasing in South Africa is becoming more popular you make lower monthly payments but here’s the thing you never actually own the the car after 3

years you give it back and start all over personal contract purchase PCP dealerships like BM Finance or Toyota Financial Services love to offer this it feels like a sweet deal low payment now

but you either return the car or pay a lamam at the end but does it really save you money now let’s get into the numbers I went down to a dealership incentive and did the match let’s use a common choice in South Africa the Toyota Corolla cross priced at around 450,000 we compare the

cost around 10% deposit and a 3year term across all four options buying outright you pay 450,000 upfront after 3 years you could sell it for about 250,000 R assuming depreciation in this case it cost you 250,000 R for 3 years of use two financing with a deposit of 45,000 R and a monthly payment of

13,000 at an interest rate of 11.5% after 3 years you would have paid 535,000 R you can sell this car for 250,000 meaning your cost is about 285,000 R listen drops your monthly payment to 7,000 r over 3 years that’s about 294,000 R in total but remember you don’t own the car and

dealership will charge you an extra if the car isn’t returned in great condition or if you exceed the mileage limits PCP with a deposit of 45,000 R and a monthly payment of 8,000 will pay about 288,000 R over 3 years if you decide to keep the car you will need to pay a final amount of 200,000

R bringing your total to 488,000 at this point you’d have been better off financing or leasing so far leasing looks cheaper but let’s dive deeper now let me share a quick Story the first time I text-decoration: none;">Financed a car I didn’t really run the numbers I thought I was getting a deal because the dealership threw in free service for a a year but by the time I finished paying off that Loan I realized I could have saved tens of thousands if

I’d simply gone for a slightly used car instead trust me it’s easy to get caught up in the excitement and this is where a lot of us get it wrong dealerships throw in exess to make the deal look sweet but you’ve got to think long term always check the total cost and not just the

monthly payment so let’s talk psychology for a moment do you like the idea of owning your car outright having the freedom to drive it across the country knowing it’s all yours that’s the appeal of buying outright or financing you don’t have the worry of monthly payment after

the terms end and you can even sell the car whenever you like or maybe you like my wife and that’s new car smell is your favorite thing about driving on the flip side leasing or PCP let you drive a new car every few years but you never really own it if you like upgrading often and want to

avoid the hustle of selling a car this could be for you just watch out for those mileage limit and extra charges so what’s the final vit if you are planning to keep your car for the long term buying outra right or going the financing route is generally the most cost effective option you get

the full ownership and the long-term Savings head up if you’re about driving a new car every few years and don’t mind owning it listen might be the best bet but be careful with those extra fees and S for PCP unless you are sure you want to keep the car at the end it

often ends up being the most expensive route so whether you are looking to buy lease or Finance the smartest move is to run your numbers and choose what works for your wallet my advice

don’t let the dealerships make the decisions for you if you found this breakdown helpful hit the Subscribe button and share with someone about to buy a car they would thank you later I’m dedicated to your success be a legacy brother and I will see you in the next CashNews.co peace