As the end of financial year approaches, every where you turn there is another ad tempting you to get a new car. But are you better off buying or leasing?
Australians take pride in their car and most people choose to own their vehicle. When you own it, you can do whatever you like with it - its yours. Taking out a car or personal loan is still the most popular form of vehicle finance. You make monthly repayments over a set period of time, usually three or five years, and at the end you own the car outright.
Whereas if you enter into a finance lease you pay for the use of the car. You still make set monthly repayments, and at the end of the loan term either pay the residual value (balloon) of the car, or swap the lease to a new vehicle. The value of a vehicle depreciates rapidly so leasing is often a better option for businesses who provide their staff with a vehicle. The business does not have to spend a substantial amount to keep their fleet modern.
A novated lease is when you take out a finance lease and your employer makes the lease payments out of your before-tax salary. Some employers offer a novated lease option as part of a salary package, as it can reduce your taxable income, but you need to consider what will happen if you lost your job.
Call Lisa Elliott on 3310 8858 to discuss how we can help you with your vehicle finance by accessing our many lenders.