Welcome to the Stay Walthy podcast. I'm your host Taylor Schulte and I have a confession to make.

I lease my car. In fact, I've leased three different cars over the last 10 years and my wife, she leases

her car as well. Now, before my friend and occasional guest host of the show, Jeremy Schneider,

shows up at my house with a spreadsheet to show me how bad of a financial decision this is,

let me try and defend myself and share a little bit more about my thinking today. First, to preface

this entire episode, one of the most common phrases you've likely heard me say on this podcast over

the years is that when it comes to financial decisions, there's the textbook answer, and

then there's your answer. And as long as your answer doesn't put your financial plan in

jeopardy, I typically don't have a problem with it. Well, I might be able to use an even bigger spreadsheet than

Jeremy to prove that leasing a car is the textbook answer, I'm okay bowing out of this debate

and just saying that even if the numbers don't crunch, I'm still very happy and confident

with our decision. And before I share my rationale behind that decision, let's start by reviewing some statistics

on the true cost of owning a car.

An important thing to keep in mind when it comes to understanding the lifetime cost of a car,

according to Jesse Kramer, who blogs at the best interest.com, is that certain car expenses

compare like apples and oranges.

For example, how can we judge grandma who drives to the grocery store one time per week against a commuter who drives 100 miles per day?

Or how do we compare costs per mile, like gas and oil changes against costs per time, like yearly registration and inspections? Well, thankfully, we have data to help us make these comparisons, and we have people like Jesse

who are kind enough to comb through it all and help create a single consistent metric for evaluating the cost of a car.

The first two assumptions that he had to make were how long people own their car for and how far people drove each year on average.

Through a number of different sources, he determined that the average lifetime of a car is 15 years, and on average people drive 13,500 miles per year, or 202,500 total miles over the 15-year life cycle of a car. Taking it a step

further, he determined that there are six major costs when it comes to owning a car, purchase and

...