Car leasing is a contract that allows individuals to rent a car long-term (typically anywhere between 24-28 months) on a monthly payment basis. Those leasing can select their preferred car for a duration that suits their needs, with mileage in mind. They will still have to cover costs such as car insurance, servicing and maintenance (this may be included, depending on the agency), and there may be additional fees on top. When you lease a car, you will need to put down a deposit, but this can lower your monthly payments if it is significant enough.

Car subscriptions are a newer form of rental to hit the market in recent years and are designed to offer all-in-one, all-inclusive car subscription packages that run from 1-24 months. One of the most attractive features is that monthly payments will include the usual costs of running a car, including insurance, breakdown cover, road tax and maintenance, so you won’t have to worry about getting everything paid separately. Deposits are typically low and can be as little as one month’s payment upfront.

Pros and cons of leasing

Pros:

Affordability

No ownership

Try before you buy

A higher deposit can lower monthly payments

Cons:

Long-term agreements may not suit your needs

Not all car-associated payments are covered

Fees can quickly mount up if you exceed mileage agreements and more

Pros and cons of car subscriptions

Pros:

Flexibility

Full coverage

Access to the latest vehicles, including electric ones deal for short-term needs

Affordability

Low deposit

7. Can benefit businesses offering company cars to a more modern workforce

Cons:

Limited mileage

You may not qualify if you have poor credit

Which option is best?

The answer to this question will depend on your personal needs. While one person may prioritise having access to the latest technologies, another may prefer the ability to try before they buy, so even the smallest difference could affect your overall decision.

As things become more and more expensive in the UK, these are certainly both affordable options, but having all of the costs covered in one payment could seal the deal. There are a host of pros and cons for both, so it can be worthwhile to do your research and make comparisons to ensure you make the right selection.