Buying a new car is a big decision and an equally large purchase. It’s important to know your options and understand which is the best fit for your situation.

First things first. Figure out what you need in a car. Are you looking for a new or a used car? How will you use the car. Are you logging a lot of miles in your daily commute, or keeping your trips short and close to home? Do you need space for a lot of people or stuff, or is it just you riding solo most of the time? Does winter make you wish for four-wheel drive? 

Narrow down your car search as much as possible and get a ballpark price tag to best inform your choice to buy or lease. 

Leasing vs. buying a car

There are two options to choose from when considering a new car. You can either lease a new car or purchase it. Keep in mind that your options are limited when buying a used car; you can only finance your purchase with a loan or pay for it in full. Used cars can't be leased.

Buying and leasing both have pros and cons. So, going with one over the other might depend on your situation, preferences, and/or what you can realistically afford.


Generally, it makes more financial sense to buy a car. It’s a fiscal move that allows for more savings and flexibility of ownership in the long term. There are advantages and disadvantages to buying that could sway your decision.



  • You own the car outright after loan is paid in full, leaving you with cashflow to put towards maintenance and your next vehicle
  • No early termination fees or mileage costs
  • Trade in or sell the car whenever you want
  • You’re free to refinance and possibly lower your payments
  • Often higher down payment and monthly payments
  • The peace of mind offered by the warranty typically expires after about 3 years of owning the car, though some well-maintained vehicles can last 200,000 miles.
  • Selling the car privately can be a hassle, but a dealer likely won't pay you as much as a private buyer

Your decision to buy—versus leasing—a car is the wisest one in the overall sense of cost-effectiveness; however, it should be a decision based on your situational needs. The key to getting a good deal is preparing yourself before you ever step foot in the showroom. Securing your financing ahead of time, through a bank or credit union you trust, will ensure that the financing part of the deal is made with your best interest at heart. The dealership is designed to play off your emotions–excitement about your new car, stress over the new expense, anxiety over negotiations, and impatience to move forward. Remove financing from the equation so you can make a focused decision in a neutral environment is your best bet. We’ll talk more about that negotiation piece in a future post.


Maybe it’s that new car smell and the latest tech and gadgets that appeal to you and drive your decision toward leasing a new car. Or maybe the lower monthly payments are more attractive to your budget.

Before signing on the dotted line, make sure you understand the full cost of leasing. Leasing deals often have complicated terms and conditions with additional fees that end up costing you more in the long run. Below are some pros and cons to leasing a car to help you make an informed decision when thinking about leasing.



  • Lower monthly payments
  • Offers the security and peace of mind of a brand new vehicle you’ll likely return before the warranty expires
  • Allows you to plan for changing needs (e.g. a growing family)
  • Upgrade your car every 3 years or so
  • Pay termination fees if you choose to turn the car in early
  • Pay mileage fees if you go over the miles allotted
  • Contracts can be complicated and difficult to understand
  • Responsible for normal wear and tear not covered by the warranty

In terms of total expense, it’s always financially better to purchase a car in the long run. But leasing may offer a practical short-term option for individual situations, especially if you’re on a budget. To decide which way to go, consider if the benefits of leasing are worth paying more in the long run, and whether the restrictions (like limited mileage and no term flexibility) will work with your lifestyle.

Most importantly, don’t let a dealership salesperson strong-arm you into making a decision before you’re ready. Get all the details about the lease agreement, including the fine print and any additional costs incurred when the lease is up, and take as much time as you need to consider the offer. Crunch the numbers in comparison to what you would pay to buy that car. If you still feel confident that leasing is a practical choice for your next car, close the deal. Arming yourself with information is the only way to be sure you make the best choice for you.

Whether you’re buying or leasing a car, you should talk to an expert whose ultimate goal is to walk you through the options and provide guidance toward next steps.

Don’t do it alone!

Still dreaming about that new car? Let’s make it a reality! Before you walk into the dealership, get your ducks in a row by deciding if you’ll buy or lease and determining what would be a good deal for your budget. As friendly as your dealer salesperson may be, don’t forget that she makes money on the sale of the car, selling the financing of that car, and any add-ons you agree to buy like optional features, extra warranties, GAP insurance, etc. Any uncertainty on your part makes your purchase easier to complicate. Complication = confusion = tipping the deal in the salesperson's favor.

Line up your financing before you shop to make sure you don’t pay more than you should. Get preapproved through your trusted financial institution to get into the car of your dreams without financing nightmares.

GOLD Credit Union has your best interest at heart and awesome auto loan rates to match.

Interested in learning more? Contact us today to talk to our team of experts.

Cori Gosser

Cori Gosser

Cori is the Vice President of Lending at GOLD. She directs and coordinates all lending activities, oversees a staff of Loan Officers and Associates, and helps GOLD Members take charge of their financial futures with loan products that fit their needs. Cori genuinely enjoys seeing our Members save money and watching their credit scores increase and lives improve due to guidance from her department.

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