There is a myriad of reasons why leasing a car for a college student is better than purchasing one. For example, a new car comes with modern safety features and a full warranty which are very useful for a young driver. You can also get very affordable deals, mainly if you use online broker that will cost you less than $100 a month. A lot of your time will be sent in class, so you don’t have to worry about exceeding the mileage limit. However, you must make these considerations before leasing a car. Here are the dos and don’ts;
- Have a realistic budget.
A typical college student has more than enough expenses to fit into their small income and allowance. These include clothing, food, entertainment, gas, cellphone, and travel. If you add car expenses to that, it has to be something you can afford to avoid late payments or financial struggle. Ideally, you should budget for 10% of your income. This means you can’t get the car you want, but at least you will have a car.
- Get full insurance coverage. The state only requires you to take up liability insurance for a leased car. However, there is a lot that can happen to your vehicle when you are in college, including towing, vandalism, and theft. Make sure you get gap insurance, collision and comprehensive insurance and of course personal injury insurance for your medical bills.
- Get the right lease period. The average lease period is usually three years, which is equivalent to the time you need to graduate from college. However, if you know you will not need the car for the entire three years, its best to get another option. Returning the vehicle before its lease period expires is very costly.
- Check the warranty. As a student, you don’t want to welcome extra expenses in terms of car maintenance. Make sure the warranty will take care of the general maintenance, so you don’t have to use your own money.
- Don’t take a car with little mileage limit. You may think that as a student, you don’t require too many miles on their vehicle because you will rarely go anywhere. However, things come up, and you might need to drive more often. Just get a deal that offers a reasonable limit of 12,000 miles per year.
- Don’t go alone. As a student, you are more likely to be taken advantage of by the salesmen at the dealership. Take a knowledgeable person with you so they can get you a good deal. An adult will understand those jargons and read through the contract.
- Pay too much down payment. The best option would actually to have no down payment, but if it’s mandatory, it should be very little.
- Take an open lease. If the car residual value is more than its actual value at the end of the lease, you will have to cover the difference out of your pocket. Make sure you get a closed lease to avoid that problem.
You should negotiate and never give your car to anybody else because they might wreck it. With these dos and don’ts, you are likely to get a good deal that will not make your college life too hard.