Hi All,

I'm a few days behind on posts, just getting caught up now.  As many of
you may know, I'm an accountant. From a purely financial point of view,
leasing by individuals who don't have their own businesses is NOT
financially smart!!! Leases were made for companies, NOT individuals. As
a sole proprietor I can write off the monthly lease payments on a car as
well as the insurance and maintenance on the Schedule C of my income tax
return. My husband, on the other hand, can't because he's employed by a
business. Even though I'm self employed, none of my cars are leased
because I plan on keeping them. I'm losing some money doing this but I
took that into account before I bought the car. I'm also planning on
modifying my GTI and didn't want to deal with removing mods when the
time came to turn in the car.

Leasing became popular by car dealers because they could get an
individual into a car they otherwise couldn't afford. Once you've gotten
into a lease it's nearly impossible to stop leasing cars in the future
because you own NOTHING at the end of the lease. In fact, you may OWE
due to mileage or damage. Any down payment you had in the car is gone.
You are paying only for that portion of the car you will be using i.e.
36 months and 45k miles. At the end of the lease a person has no money
to put down on another car and gets talked into another lease. Even if
you buy the car in end, you'll be paying a LOT in finance charges
because you'll end up taking the car over as much as 10 years!! (5 year
lease + 5 years to pay off the buy out). You'll also be required to
carry more insurance and a lower deductible since you have to protect
the true owner of the car, the leasing company. You'll also need to car
"gap" insurance to cover the difference between what the car is worth
and what is owed on it. This "gap" can be substantial and expensive.
Remember, insurance only pays what the car with WORTH not what is OWED
on it. Luckily, GTIs hold their value well (or at least the ones I've
owned have!) so any gap would be minimal. If you have little or no money
down, this gap will, of course, increase.

I advise my clients, family and friends that if you can only afford to
lease the car you're looking at, you can't afford the car. If you want a
new car, look for one that you can afford to buy. If you can't afford
the car you want new, don't lease it, buy it used. The only people who
benefit from leases are business and the self-employed who can write
them off. Don't fall in love with a car you can only afford to lease.

I'm not trying to cut anyone down, just trying to offer some sound
financial advice to those who may not know what the true costs of
leasing are. I don't know tax codes in Canada so our friends to the
North can ignore this. No flames please, there are a lot of younger
people out there who truly don't know! Even my 34 year old neighbors
don't know and are now trapped in the leasing game with $800 a month in
lease payments on 2 cars!!

Trish
'00 Black GTI GLX VR6
'98 Ranger 4X4
'65 911