The rise in popularity of electric cars has gone up dramatically. These once dream cars are now easier to purchase and charge up, helping your electric bill. One of the most popular brands to buy is a Tesla (NASDAQ: TSLA). Elon Musk knew what he was doing when he figured out how to easily create and offer electric cars. The problem for a lot of people who want one is how expensive it is. Fortunately, there are a couple of different ways you can get into a new Model X. Two of the most popular ways to get a new car are to either lease or outright buy it. If you’re undecided about what you should do, here’s a helpful guide. 

 

Leasing A Tesla Model X

What exactly does it mean to lease a car? If you lease a car, you agree on an exact time frame for how long you want to drive the car. You can also agree on the amount of miles you want to drive the car. For example, instead of having a 60-month payment for a car, you would lease a car for 36 months. This would allow you to drive whatever car you want for 36 months. However, you can’t drive more than 10,000 miles per year, on average, during these 36 months. The second that timeframe is over, you have to return the car. It’s in your best interest to return the car before you exceed the average of 10,000 miles.

This is because the dealership will charge you for every mile you go over. That varies from dealership to dealership, but the average is 30 cents per mile. The amount you owe adds up quickly if you’re not careful. Now, let’s talk about the Model X specifically. The Tesla Model X leasing cost is based on a purchase price of $94,990. On average, you’ll have to put down $10,000 upfront before you get started. After that, you’ll sign a lease of $1,717 before other fees and taxes. These taxes and fees vary based on what state you live in, your credit score, and a few other things. Once that’s all signed, you’ll be good to go for the next three years. Now let’s talk about how much it costs to buy a Tesla Model X.

 

Buying A Tesla Model X

Unlike leasing, purchasing a car allows you to drive for however long you want and however many miles. The car is all yours. The price for purchasing a car is lower than what the estimated value is if you lease it. This is because if you buy it, the dealership doesn’t have to worry about reselling it. Nor do they have to worry about any potential accidents or other issues. Leasing a car comes with more risk for the dealership, so they raise the value of the car to get you to pay more per month. The purchase price of a Tesla Model X is $79,990, excluding taxes or fees, compared to the lease value of $94,990. These taxes and fees vary based on where you live, like with leasing a car. For example, if you live in California with average credit, get the average new car interest rate of 6.63%, and put down $10,000, your monthly payment will be $1,373.70. 

 

Is It Better For You to Lease or Buy A Tesla Model X?

The answer to this question comes down to what you want from the car. Odds are, if you’re looking into a Tesla, finances aren’t going to force you to make a decision one way or the other. But if they are, you should buy the car and have a payment plan. You can return the car early if you lease it, but you’ll have to pay a price. And even so, it’s still $340 cheaper to have a monthly payment. Teslas hold their value well, so if you did sell yours, you’d get a very similar price to what you originally bought it for. If finances aren’t coming in the way of your decision, then you have to think about what you want.

If you’re unsure about if you want to drive a Tesla Model X for a long time, it’s still a smarter decision to buy it. Even before calculating the fees and taxes, if you live in California, after the 36 months are up, you’ll have paid $71,812. This was calculated by multiplying 1,717 by 36 and adding in the $10,000 down payment. You’ll have almost paid the value of the car if you just purchased it. Let’s say you buy the Tesla and aren’t the biggest fan of it after those three years. Assuming you live in California, have average credit, and get the 6.63% rate, you’ll have paid 59,452.20. That’s $12,000 less and you can re-sell it to pay the rest of the balance off. You might even be able to pocket a little bit of the money. It might seem like a good idea at first, but leasing instead of buying the Tesla Model X isn’t a good idea. 

 

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