Lease a Rolex

[Frampton]

Originally Posted by CPTL

With a car, what you're really paying for in a lease is depreciation. The 30k car will be worth 18k after a 3 year lease, so you're paying for the dealer's depreciation (plus some taxes, profit, etc). That money isn't "thrown away," as even if you bought the car for $30k you would still be out $12k in depreciation, plus sales tax, the interest you could have made on a $5k (for example) down payment, etc.

With a Rolex, the asset is likely to either stay flat or appreciate in three-years' time--so the lease cash is thrown away.

I can't think of any financially sound way to lease an asset that doesn't depreciate. Using purchase money financing will always be superior.

That's really the argument in a nutshell. Add to that the fact that many vehicle leases are made for business purposes, and you then have the added benefit of expensing the payments. This benefit could not be realized for a luxury item such as a wristwatch.

[kelly56]

Leasing a car is a bad idea. Leasing a watch is stupid. Find an AD willing to offer a 12 months same as cash arrangement.

[GBJIV]

This is really a math question. How much is the total cost of ownership leasing for the period plus the amount due for purchase at the end. Tax incentives really do not come into play unless you want to be audited. So, do the math on total cost of ownership - see what you are paying for the option and see if it makes sense. Think about the time value of your money during the period if you were holding on to it and investing it or what have you. Compare the numbers and see if it is worth it.

Because the asset in this case - Rolex does not seem to depreciate on the open market much - I think the consensus on this forum is correct - probably will not work out well mathematically because the residual would probably be close to buying a new one at the end of the lease. So, probably best to buy it up front and or finance it with discipline (pay the terms exactly during the period) so that you truly get the financing for free. The gamble is that you will miss a payment or go over the terms and then the rate explodes to something completely unreasonable. Anyway, look at the math - it may make sense.

In many cases here in the U.S. - the math on leasing a car with associated tax benefits is highly advantagious versus buying. Also, cars here often depreciate more than set residual value and it is very nice to give a car back when it is not worth what you would need to pay to own it. This has happened to me on a couple of Mercedes.

Anyway - Good Luck with your decision!

[B-ling88]

I have leased a car
Mortgaging my condo
Never leased watches and paid full on all my watches

[FrankinCA]

my understanding of watch leases is that you will pay an interest rate of some sort. You might be paying more for your watch than need be.

I am getting ahead of myself, but I wouldn't do it. If I didn't have the money, I wouldn't do it.

Also, this type of debt is considered revolving credit. This affects your credit score.

I would wait until I have the money or most of it and put the rest on a card.

good luck.

Frank

[SUPERDOC]

I don't think that it's fair to compare a car to a watch...

I have both owned and leased cars, and right now leasing is a much better option...#1. I'm incorporated and it's better from tax perspective.
#2. You only pay for the portion of car you use...and you only pay the taxes on that portion. In 3 yrs, the car has depreciated so much that if you had purchased and tried to sell in three years (and I have a short attention span, and no use for a car that may need maintenance repair) you would lose on having paid full taxes....and it may be the difference of only a couple thousand. My time is more valuable than that, and the time wasted tryong to sell the car could be put to better use.

#3. right now the car market is shaky in canada....anyone who bought their car over a year ago is going to take a huuuge hit trying to sell because of the recent price adjustment in the canadian dollar. anyone with a lease just walks away from it.

In addition, trying to sell your 2008 model in 2011...what will it be worth if there is an alternate fuel source? or electric or solar rules the day...
May be a bit like selling your HDDVD player, or betamax...

A Rolex will never be a betamax.

[ed830]

Originally Posted by Timekiller

I am aware this is a developing trend but I have a couple of questions regarding leasing a watch. Can you get out of the lease early? Any penalties for that? Do you have the option to purchase the watch at lease end? Value based on what? If not, then do you have to lease another one?

Like most who have responded I understand the advantages/disadvantages of leasing a vehicle. I'm not sure I see much benefit except a small monthly payment versus an outlay all at once in leasing a watch. In the case of the vehicle you can get out early, ie trade it in, you can buy it at the end if you fall in love. What happens with the watch?

According to their lease agreement, like car leases, you can terminate the lease early and penalties are calculated base on fair market value just like cars. In that case for Rolexs it make sense cause it retains its value better. The purchase option is also stated on the lease contract just like car leases. but here unlike cars the residual is set at much lower percentage which means paying it off should not be a problem.

I am stating these cause I just leased a Explorer II through them. I am paying $180 / month for a 3 year program. By the end of the lease the residual is set at $1,000 to own the watch outright. I guess that still gives me an added option should I decided to let the watch go (not likely) but I still enjoy that option to choose. Important thing is, I am wearing the watch I wanted for a long time.

[f16570]

Still sounds like a lot of cash to me. Surely a bank loan/dealer credit wouldhave worked out cheaper. The AD I got mine from offered 24 months 0% with a 10% deposit. Total payaple MRP. No Interest No Worries.

[ed830]

Originally Posted by f16570

Still sounds like a lot of cash to me. Surely a bank loan/dealer credit wouldhave worked out cheaper. The AD I got mine from offered 24 months 0% with a 10% deposit. Total payaple MRP. No Interest No Worries.

I ask my AD and the 0% offer are for hard to sell pieces. You can really ask them to discount the more popular Rolexes since the 0% offer is basically a form of discount disguise in a finance program. My AD did try to get me into a different watch and offered me discounts in the cap cost of the lease. But I like the Explorer II.

[Wolfgang427]

Originally Posted by azmmza

Would you lease a brand new Rolex Submariner for 36 months at $100 a month?
I lease my car
I lease my condo
I know that im better off buying both, and not leasing but most people still lease their cars.

So bottom line, if you had the option to lease the watch would you?

No I would not.
I don't lease my cars and I don't lease my house. If you keep leasing stuff you will never own anything.