Imagine driving a new, or near new car every day for the rest of your life. For many people, that is the main appeal of leasing.

Leasing allows Americans with little, or no, down payment to drive away with a new car every three or four years. Monthly payments are lower than a standard automobile loan and in most cases a solid warranty means few worries for the length of the lease.

When you lease a car or truck you are basically choosing to rent rather than to buy. You make a small down payment and pay a monthly lease charge until the term expires, about three years down the line. When the lease ends you can buy the car, sell it privately or simply return it. Most people elect to return the car to the dealership or leasing company and start the whole process again.

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Like anything, leasing has its pros and cons to consider:

The pros of leasing:

• The down payment required is smaller than if you purchase a vehicle.

• Monthly payments are lower (unless you put on high mileage and agree to pay an additional fee to compensate for this).

• When the lease expires you simply return the car to the agent. There is no need to worry about negotiating a trade-in or selling privately.

• You will always be driving a new, or near new, vehicle.

• You can drive a nicer car than you would if you bought the car and were making loan payments.

• If you use your vehicle for business you can deduct the depreciation and interest on the lease.

• A good new car warranty means your maintenance costs are low.

The cons of leasing:

• You build no equity in the vehicle.

• You will always have a car payment as long as you continue to lease.

• If you lease a car you cannot customize it in any way.

• You must pay a fee (often high) if you end the lease early.

• You may have to pay a fine at the end of the lease if the vehicle has not been maintained well.

• The number of miles you can put on the car each year will be limited, or you will be subject to an additional fee.

You need to evaluate your own situation – what your real automotive needs are – and make the decision for yourself. Remember, if you decided to buy a new car rather than lease it, and you maintain the car well, it should last for 10 or more years depending on how you drive it. That means that many of the years you are driving it, there are no car payments to make. So the question becomes, are you happier with the idea of no payments for several years or the idea of driving a new/newer car?