United Poles Federal Credit Union

? ? SHOULD I LEASE OR PURCHASE? In today's car market, a buyer needs to decide whether to lease or buy a vehicle. An article in Consumer Reports from August 2, 2017, titled "Pros and Cons of Car Leasing," notes that leasing can be more appealing than buying because of the lower monthly payments since you're not paying back any principal. With a lease, you pay only the amount of the car (that depreciates over time) and finance charges. Another pro is that a leased car is usually covered by a manufacturer's warranty, which in some cases may include oil changes and some standard maintenance. Leasing may also allow you to drive a higher-priced and better-equipped vehicle than one you could buy. You don't have to worry about selling it or trading it in, and there may be tax advantages to businesses that lease vehicles. That same article in Consumer Reports also cites the downside of leasing a vehicle, which includes, among other things, the fact that a lease is never paid off, so you have an endless string of lease payments, and in the end, you may also have to pay for excessive wear and tear with no vehicle to show for it. Also, keep in mind you may have a limited number of miles to drive on a lease, and if you go over that mileage, it can cost you. WHAT CAN I EXPECT AT A DEALERSHIP? Don't assume you'll be able to go to a dealership just to look around. When you step on a lot, you can expect to be approached by a salesperson. You can also expect to answer some qualifying questions so the salesperson can better help you find what you're looking for. Many traditional dealerships sell both new and used cars. At a traditional dealership, you can expect to haggle over the price. If you go somewhere like CarMax ® , where they only sell used cars and have a no-haggle policy, you should expect to pay the price on the sticker. If you decide to buy a new car from a dealership, you may have the option of adding extras to the basic model. In fact, some of the cars on the showroom floor will already have some of these "extras" that can inflate the price of the car, adding hundreds of dollars to the sticker price, and complicate the negotiation process. These include items that don't come standard with the car, such as chrome-plated wheels, splash guards, alarm systems and more. According to Edmunds.com ® , when it comes to car buying, and specifically the extras, do your homework. Often these are high-profit markups that drive up the price of the vehicle. Don't pay more than you should. 6

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