My 22-Year Auto Lease Nightmare

It wasn’t our fault that a drunk driver plowed into our parked car in the middle of the night while we were on vacation more than 500 miles from home. The car was a total loss but no one was hurt; it could have been worse.

Our loss was insured and we got just enough money from the insurance company to pay off the loan. We wanted to replace that car anyway.

To buy a new car would have required borrowing the down payment and taking on bigger monthly payments. We could have financed a used car with lower payments, but that was beneath what we thought we deserved. A better option—or so we thought— was to lease a new car with nothing down and lower payments than we’d been used to making.

At this critical decision point in our lives, my husband and I blew it. We made the worst choice possible: to lease a new car. It was a decision that turned into a financial nightmare.

Our first leased car lost its value terribly, so we owed a lot when the auto lease was up. Again, we had no available cash, so rolling the shortfall into another auto lease was easy. We repeated this many times and even upped the ante by leasing two new cars at a time. It became nearly impossible to break this cycle that went on for 22 years.

Looking back, it’s easy to see the error of our ways. However, I believe that even in my financially stupid years, if I’d taken five minutes to visualize the choice we were about to make in light of the future, I would have at least hesitated. I want to believe we would have made a different choice.

Over a million people will graduate from college in the next couple of months. Some will start new jobs, while many are still looking; some will move into new apartments, while most will move back home. One thing they all share: They’re facing a world of new financial obligations.

Many graduates already carry a load of debt. To those who are in debt up to their eyeballs, I offer some unsolicited advice. (And this goes for the rest of you, who might be years or decades past your college years—but are still carrying a load of debt.)

The decisions you make now will impact your life in a profound way for years to come.

If you decide to stretch out your student loan payments, take on car payments, plus all the other things you believe you so richly deserve, prepare to take a financial plunge from which it will be difficult to recover. You will open the door to awful things.

The other option is to commit to an upward trajectory by choosing frugality. Even with student debt, if you choose to avoid new debt and live below your means so you can repay your debt quickly, you will be on your way to financial freedom. SOnce debt-free, you’ll be ready to soar.

You’ve reached a critical decision point. There’s no turning back now. Your choices are clear. It’s either up or down. Choose wisely.

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4 replies
  1. Emily Booth
    Emily Booth says:

    I never leased a car but I lived in credit card debt for over 20 years. When I graduated college, credit cards were so easy to get. I constantly got offers in the mail. I made so many bad decisions. I lived from paycheck to paycheck. It was a life of penury. I am over the guilt. Today I live a life of no debt. I tithe. I travel. I have $$ in the bank for emergencies. I enjoy life. But I wish I knew then what I know now about finance.

    Reply
  2. Spice Weasel
    Spice Weasel says:

    And you and your husband were lucky it wasn’t far worse. If one of you had passed on, the survivor would have been on the hook for the whole amount of the lease or both leases when you had two leases. That happened to a friend of mine. Her husband died suddenly about a week after he had leased a new car. Every one expressed their sympathy but were adamant that she had to pay for the lease on the car as dying does not void contracts. If she wanted to return the car, there would be a penalty of over $10,000 for a car that was 1 week old and had less than 50 miles on it! To make matters worse, since the lease was only in her husband’s name, she had to fight to be able to legally even drive the car. At one point, it looked like she might have to hire a flat bed tow truck to take it back to the dealership!

    Lesson: anything that’s pushed hard by a car dealership is probably in their best financial interest not mine.

    Reply
  3. Pat
    Pat says:

    Oh no. What a nightmare. I just taught my daughter to pay cash for used so that she doesn’t have to worry about payments. She loves it now. I have always done that. I hate paying bills. Cash is the only way to go. When we came back stateside (Military) I had to buy a used car and make payments (only 6 thank god after cash down) and that almost killed me. I have never had a car that I had to make payments for in my whole life until then. I usually upgrade my cars every ten years and sell the old one to somebody else.

    Reply
  4. Gwyn Ewing
    Gwyn Ewing says:

    Yikes!! Your story is so scary!

    I went over 4 years without a car when I I was a single mom in my 30s. I lived in apartments which were near bus lines. I walked, rode the bus, and biked to work. I was determined not to take on any more debt, since I was focusing on qualifying to buy a house.

    People would say, “but what if you have an emergency?”. I figured if it was that bad – I could always call 911. I never needed to. In a pinch, I would rent a car from the cheapest agency around.

    Later, when I remarried, we often kept it down to just one car between us. Sometimes, we didn’t even have any vehicle at all. Now we have just one. I walk to work. We much prefer to live below our means!!

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