Anyone Else Want to Just Punch...

[jlewisinsyr]

Suze Orman...

I seriously cannot stand her. She lives in a fantasy world, one that would basically destroy our economy and probably end about 50% of the remaining marriages that are not already getting divorced.

I remember she was on My Life on D-List once and I seriously wanted to hit her. She was talking about how bad leasing was, blah, blah, blah, and he rhetoric was so played out it wasn't even funny. Her logic was VERY flawed for 90% of the people that leasing works GREAT for, if anything there are more people who should lease!

 

[DVC~OKW~96]

Lease what?

I really haven't listened to her much. I know she's family. Loads of people seem to find her advice valuable. I don't have enough money to worry about investing or doing anything other than paying bills! LOL!

 

[jlewisinsyr]

Lease what?

Vehicles...lesson one of finance Do Not Invest in Depreciating Assets, purchasing a vehicle in cash, loan, etc, is a poor financial decision. Leasing (or renting) is what you do with depreciating assets.

 

[DVC~OKW~96]

Ah. Gotcha.

So then, seriously? I mean I know purchasing a new vehicle immediately subjects the vehicle to depreciation, but is leasing better in the long run?

Here's my (very imperfect and completely NON financial background) thought. If I lease a vehicle, there is a time when I have to return it or pay a balloon payment? Whereas, if I purchase one outright, I could end up driving it for ten or more years (like we did with our little Nissan) which would offset the earlier depreciation?

How off the mark am I?

 

[Tony-NJ]

I think a lot of her advice would cripple the economy LOL. I recently heard her saying to start living like we all lost our jobs - get rid of cabe, internet, land lines, etc. The last thing I would do if I lost my job is get rid of the internet. Has she ever heard of networking?

Then she doesn't want you to spend money at all - I understand we should save money - but if everyone stopped spending money ( almost what's going on right now) it would get much worse than it is now.

Oprah should NOT have her back on LOL! That show reaches too many households...

 

[jlewisinsyr]

Ah. Gotcha.

So then, seriously? I mean I know purchasing a new vehicle immediately subjects the vehicle to depreciation, but is leasing better in the long run?

Here's my (very imperfect and completely NON financial background) thought. If I lease a vehicle, there is a time when I have to return it or pay a balloon payment? Whereas, if I purchase one outright, I could end up driving it for ten or more years (like we did with our little Nissan) which would offset the earlier depreciation?

How off the mark am I?

You wouldn't be a good person to lease, but most consumers replace their vehicles approximately every 3 - 5 years, which means leasing is a better option. There is a lot more to this then that, but there are reasons many businesses lease vehicles (and other major depreciating assets) instead of buying them.

I actually wrote a paper on the misconceptions of leasing and the financial benefits of doing it.

 

[dfchelbay]

Who can afford to buy a new car that is reliable and will give you ten years or more of use? You would have to spend $20,000.00 or more for such a car. The math on that would be...and I'm using 0% interest:

36 mos. $555.55
48 mos. $416.66
60 mos. $333.00
72 mos. $277.77

This is lower that what it would really cost you. Interest has to be figured in, and the real price is probably more like $23,000.00 - $25,000.00 for a Honda or Toyota that you could get 200,000 miles or more out of. Don't forget you have to have auto insurance too. Full coverage as long as you still owe money on it. Generally speaking your warranty is 3 years/36,000 miles (unless it's drivetrain problem) You get to pay for those repairs yourself once your out of warranty (and still making the car loan payments).

 

[Chuck S]

You wouldn't be a good person to lease, but most consumers replace their vehicles approximately every 3 - 5 years, which means leasing is a better option. There is a lot more to this then that, but there are reasons many businesses lease vehicles (and other major depreciating assets) instead of buying them.

I actually wrote a paper on the misconceptions of leasing and the financial benefits of doing it.

One reason businesses lease is because it is a direct expense write off, no depreciation. Individuals don't have that write off tax break. The tax laws make leasing the best deal for a business.

As an individual, I buy my cars and drive them for 10 years or 150K miles. It makes more sense for me to do that.

 

[zeitzeuge]

After owning 4 cars in the past 12 years, I finally decided to lease this last car. Every car prior to that, I owed more then what it was worth. By the time I got my 4th car, it was ridiculous how much I owed.

My current car I leased. I got a lower rate, negotiated the miles, and even though I was still upsidedown some on my car, my payment dropped about 180 dollars a month. If I wasn't upsidedown on my previous car I traded in, he said that I would have probably been closer to 250-280 lowered payments.

When I trade in my current lease for my next car, the way it's worked out, I will never be upsidedown on the car.

Plus, it took me 15 minutes over the phone to do the deal. They showed up the next day at home, dropped off the car, took mine, signed the paperwork and he was gone 15 minutes later.

I'll never buy a car again since I like to have a new one every 3 years anyway so I'll have a warranty.

 

[MAF]

I love Suze Orman...

 

[PeterPan09]

I've heard that she has a deal with FICO, which is why she constantly recommends that people get their FICO score, not just their credit score.

 

[zeitzeuge]

FICO basically is a company formed as a way to measure credit risk by a man named Fair Isaac for the Fair Isaac Corporation. FICO scrore is just a term given to credit scores based upon the Fair Issac scoring system the company developed. The three major bureaus, Equifax, Experian and TransUnion all use the FICO way of scoring. All companies use one or all three of these bureaus scores in credit decision making.

The term FICO used for credit scores has kind of become how we use the word Bandaid or Kleenex.

(Sorry, I've been working in the mortgage lending industry for 19 years. LOL )

 

[DVC~OKW~96]

Well you see? I am learning some things! :yes:

The Nissan we bought was a deal, I'm sure. It was used (less than a year old) and ended up being about $12,000. We drove that baby for 10 years, and if she hadn't jumped time (timing belt) we'd still be puttering along in it. :yes:

I do understand a little bit about leasing, but have never really seen how it would benefit me.

In some ways, the little I've heard of Suze does seem to make sense. She advocates for living within one's means from what I can gather? Perhaps if more people had done that we'd not be in this mess, or is that too simplistic?

She's a little too preachy for me, a little too warm fuzzy. Money, finances, etc. should be about just that, not take the bend that she seems to bring to the topic.

Sheesh! Not sure where I got that opinion from as I've really only ever seen bits of her and then not often!

 

[jlewisinsyr]

One reason businesses lease is because it is a direct expense write off, no depreciation. Individuals don't have that write off tax break. The tax laws make leasing the best deal for a business.

As an individual, I buy my cars and drive them for 10 years or 150K miles. It makes more sense for me to do that.

I am well aware of the variance differences, I am a financial analyst for a Global Fortune 25...

I was trying to be simplistic in terms of the reasons, but, yes there are other reasons besides capital, like the tax benefits.

Again, leasing isn't for everyone, but to just knock it down as not an option is a poor decision. You, like others have said regarding mileage and time you'd keep your vehicle, are not a good lease candidate.

 

[DVC~OKW~96]

So, from my totally uniformed/financially ignorant perspective, finances, money mangement, ect. should be a matter of "cut and dried." Do this, don't do that. Here is what the best option is...

I'm getting the impression that isn't always the case? Feels more like a soft science/art to me, rather than the hard science/ numbers never lie thing I thought it was?

So, if the average Jane wants to determine what the best approach to financial management is for her and her family, where does she start?

 

[Uncle Remus]

So, from my totally uniformed/financially ignorant perspective, finances, money mangement, ect. should be a matter of "cut and dried." Do this, don't do that. Here is what the best option is...

I'm getting the impression that isn't always the case? Feels more like a soft science/art to me, rather than the hard science/ numbers never lie thing I thought it was?

So, if the average Jane wants to determine what the best approach to financial management is for her and her family, where does she start?

Start by using your own financial formula which should be can ya afford it?

It's all mumbo jumbo so someone else can get a piece of your pie, they're all in cahoots with each other.

 

[TuckandStuiesMom]

I know I'm kinda a weirdo -- but I always buy, run'em as long as I can (my once a week hay truck's got almost 300K on it and my old RAV4's closing in on 250K) and pay cash. My big savings is on insurance -- I carry collision on my husband's big high-dollar truck but only liability on the other three (with two under 25 yo drivers, we save about $3,600/years with liability only)

As far as I can tell, there really is no one-size-fits-all solution.