This Real Estate Idea Is Stupid

Summary

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Podcast Summary: The Ramsey Show Highlights

Episode: This Real Estate Idea Is Stupid
Date: July 12, 2026
Hosts/Experts: Financial Advisor (from the Ramsey Network)
Theme: Leasing vs. Buying Cars in Retirement

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Episode Overview

In today’s highlight episode, a retiree calls in to seek advice about the wisdom of leasing a new car every three years during retirement to avoid car maintenance hassles. The Ramsey Network financial advisor evaluates the logic behind leasing versus buying outright—especially for those with significant financial means—and offers decisive recommendations about which option actually makes the most sense.

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Key Discussion Points & Insights

1. Retiree Dilemma: Leasing for Less Maintenance

• Retiree’s Inquiry [00:06]:
  The caller, a 70-year-old retiree with no debt and significant financial stability, asks if it makes sense to lease cars every three years so he never has to deal with maintenance worries.
  • Quote:
    "At our age, I don't want to worry about paying for car maintenance. Considering that we can easily afford this. Is it okay for us to lease rather than buy a car?" [00:06]

2. Maintenance Myths With Leasing

• Advisor Clarification:
  • Leasing does not eliminate maintenance responsibilities. Any new car, whether leased or bought, requires the same routine care, though the risk of major repairs is lower when cars are newer.
  • Quote:
    "Leasing a car does not get rid of maintenance. You're still responsible for the maintenance. You're thinking because you're driving a newer car, you're not going to have any." [00:29]
  • The warranty would apply regardless of purchasing or leasing, and minor wear items are not typically covered even on a lease. "The warranty would be on the new car, whether you bought it in cash or whether you leased it." [00:44]

3. Financial Sense: Buying vs. Leasing

• Advisor’s Core Advice:
  • If you have the wealth, buying a new car outright is preferable.
    "If you're a multimillionaire and you want to go buy $100,000 car, go buy a car, just write a check." [01:09]
  • Trading in a new car every three years incurs a loss, but leasing is even costlier due to built-in profit margins and interest in the lease agreement. "You're going to take a loss on that car, but you're going to take a bigger loss if you lease it because 100% of the loss in value is built into the lease." [01:18]
  • Leases include the maximum expected depreciation, plus profit and capital/interest costs.
  • Even rental options (like renting from Hertz full-time) are prohibitively expensive and impractical.

4. Depreciation & Margin

• Financial Wisdom:
  • Cars are a depreciating asset, losing the bulk of value in the first five years. "Cars lose 70% of their value in the first five years. And so $100,000 car becomes a $30,000 car in five years. And that's burning cash." [02:36]
  • If you have the margin and want a new car every three years, buy it outright. Don’t lease.

5. Takeaway: Why Leasing Is "Horrible"

• Strong Language & Final Judgment:
  • The advisor repeatedly and emphatically denounces leasing for nearly all scenarios: "Don't lease it. Don't, don't lease it. No, no. Horrible, horrible, horrible, horrible. Did I mention that it's horrible?" [03:22]
  • For the wealthy, buying and accepting the rapid depreciation is simply a luxury you can afford—leasing just adds cost and provides little to no real benefit.

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Notable Quotes & Memorable Moments

• "Leasing a car does not get rid of maintenance. You're still responsible for the maintenance." — Financial Advisor [00:29]
• "You're going to take a loss on that car, but you're going to take a bigger loss if you lease it because 100% of the loss in value is built into the lease." — Financial Advisor [01:18]
• "Cars lose 70% of their value in the first five years. And so $100,000 car becomes a $30,000 car in five years." — Financial Advisor [02:36]
• "Don't lease it. Don't, don't lease it. No, no. Horrible, horrible, horrible, horrible. Did I mention that it's horrible?" — Financial Advisor [03:22]

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Timestamps for Important Segments

• [00:06] - Retiree’s question about leasing vs. buying and maintenance
• [00:29] - Advisor debunks the maintenance myth for leases
• [01:09] - Why cash buyers are better off skipping the lease
• [01:18] - Leasing is more expensive due to baked-in losses and profit
• [02:36] - Discussion of car depreciation rates
• [03:22] - Advisor’s emphatic conclusion against leasing

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Conclusion

Bottom line:
If you have the financial means and want to drive a new car every few years, buy it with cash and accept the depreciation. Leasing merely magnifies how much value you lose. The theme is clear: Leasing is a “horrible” idea—even for the wealthy—because it guarantees more financial loss, not less hassle.

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Transcript

[Financial Advisor]

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[Retiree]

I am a 70 year old retiree. My wife and I prepared well for retirement and have no debt, including our home. I would like to lease a car for three years and then give it back and repeat the process every three years. At our age, I don't want to worry about paying for car maintenance. Considering that we can easily afford this. Is it okay for us to lease or rather than buy a car?

[Financial Advisor]

Leasing a car does not get rid of maintenance. You're still responsible for the maintenance. You're thinking because you're driving a newer car, you're not going to have any.

[Retiree]

Is it paying for maintenance? Is the.

[Financial Advisor]

I wonder if the warranty is not included in a lease.

[Retiree]

If the warranty for.

[Financial Advisor]

Well, the warranty would be on the new car, whether you bought it in cash or whether you leased it. And the quality of the car not needing as much maintenance might be what he's referring to. I want to drive a nice car so I don't have to worry about it.

[Retiree]

Well, he just said not worrying about paying for car maintenance. Paying for.

[Financial Advisor]

Well, you do pay for car maintenance, but you don't have to pay for it. If there's not much like a brand new car, you don't have a lot of maintenance on it.

[Retiree]

Yeah, that's true.

[Financial Advisor]

So that's what I'm thinking. He's thinking about. I want to drive a nice car that doesn't require a lot of maintenance. Okay. If that's what you're saying, it's ridiculous to do it the way you're talking about. You should just buy the car and go buy a brand new car. It sounds like you're a multimillionaire. If you're a multimillionaire and you want to go buy $100,000 car, go buy a car, just write a check. And then three years later, if you feel like that car's getting old, then write another check, get you another one. And you're going to take a loss on that car, but you're going to take a bigger loss if you lease it because 100% of the loss in value is built into the lease. So whatever you would lose by buying a new car and trading it every three years, you're paying for it in the lease. You're going to lose more than that by leasing because the lease covers at least that plus a profit, plus a cost of capital and the interest.

[Retiree]

Yeah.

[Financial Advisor]

So your theory breaks down and if you think that leased cars have less maintenance than Cars that are paid for that are the same exact car, they don't. And there is no lease maintenance program. Now, you could rent one at Hertz and Hertz will keep it, but that would be like super expensive, right? If you want to go over Hertz or dollar rent a car and rent you a car the whole time, they'll, they'll maintain their car, but you're going to pay through the nose for that, obviously, and that's not what you're talking about. So I'm thinking that what he's talking about is that a nicer car doesn't require as much maintenance.

[Retiree]

And if I get a new car every three years, I'm not going to have as much.

[Financial Advisor]

I don't have to worry about it. And if you can afford to do that and you want to do that, I don't have a problem with that at all. It's just you're losing a lot of money in the first three years is when a car loses its most value because cars lose 70% of their value in the first five years. And so $100,000 car becomes a $30,000 car in five years. And that's burning cash. Don't wait for the interest rate to be perfect. Before buying or refinancing a home, talk to Churchill Mortgage. Smart buyers buy the home they can afford now and then refinance later if rates improve. Churchill helps you make decisions with confidence instead of guessing. And Churchill Mortgage has a webpage with special offers just for our audience. Go to Churchillmortgage.com Ramsayoffer this is a paid advertisement in MLS ID 1591 in mlsconsumerexcess.org equal housing lender. But if you got a lot of money, you can afford to do that. Okay, I just bought a brand new Ford Bronco Raptor package, okay? But I can afford for the thing to be worth nothing in a few years. I can afford for that. It's not gonna affect my life. I've got enough margin. And if that's you, you got enough margin and you want to do this, I'm fine with that. You know, that's, that's why you've worked. But don't, don't lease it. Don't, don't lease it. No, no. Horrible, horrible, horrible, horrible. Did I mention that it's horrible? Create your free every dollar budget today. The simplest way to budget for your life.