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Start the New Year Right: Financial Tips for Buying or Leasing a Vehicle 

January 7, 2025
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The holiday season often comes with its share of financial strain. Between gift shopping, festive gatherings, and year-end expenses, your wallet might feel a little lighter. If you’re planning to buy or lease a vehicle, whether new or used, it’s important to take a step back and evaluate your finances to start the year on the right foot. 

Here are some key financial considerations to keep in mind: 

  1. Assess Your Budget
    Take a realistic look at your post-holiday finances. Determine how much you can afford for monthly payments, including additional expenses like insurance, maintenance, and fuel. Keep in mind that these costs will vary depending on whether you choose to lease or buy. 

    Many Canadian banks provide car loan calculators to estimate vehicle costs and monthly payments. The Canadian Automobile Association (CAA) also offers a tool to calculate ongoing ownership expenses. 

  1. Understand All-In Pricing
    In Ontario, dealers are required to include all fees in the advertised price of a vehicle. This means the cost you see should include charges like freight, PDI, and other mandatory fees. Always confirm that the advertised price matches the final bill of sale. Be sure to read our article from last year to better understand all-in price advertising before you begin looking at vehicles.  
  1. Compare Leasing vs. Buying
    Leasing a vehicle often comes with lower monthly payments, but you won’t own the car at the end of the lease term. Buying a vehicle might be more expensive upfront, but it offers long-term value if you plan to keep the car for several years. Weigh the pros and cons to determine which option suits your lifestyle and financial goals. 
  1. Plan for Long-Term Costs
    Beyond the purchase price or lease payments, think about the long-term costs of owning a vehicle. This includes maintenance, potential repairs, and the impact of depreciation on a car’s resale value. If you’re buying used, ensure the car has been inspected and comes with a history report to avoid unexpected issues. 
  1. Shop Smart and Avoid Curbsiders
    Curbsiders are illegal, unlicensed sellers who often misrepresent vehicles. To avoid scams and hidden costs, and to ensure you are protected by the provincial legislation be sure to buy from a registered dealer. This means should something go wrong with the purchase, you are covered by the Motor Vehicle Dealers Act (MVDA) and Consumer Protection Act (CPA) 

    You can verify a dealer’s registration on the OMVIC website.  

  1. Don’t Rush
    Post-holiday sales and incentives can be tempting, but don’t let a good deal pressure you into a quick decision. Take your time to research, compare options, and consider how this purchase fits into your overall financial plan for the year. 

    And remember there is no cooling-off period in Ontario. This means once you have signed a contract, it is a legally binding agreement.  

Start 2025 on Solid Ground 

A new or used vehicle is a significant financial commitment, even when leasing. By carefully considering your budget, understanding the true cost of ownership, and avoiding common pitfalls, you can make a decision that sets you up for success. 

For more tips and resources on car buying or leasing in Ontario, visit OMVIC.ca. We’re here to help you make informed choices and protect your rights as a consumer.