Happy New Year everyone!

The New Years is a perfect time to make some personal finance resolutions that will change the course of your financial life. On tomorrow’s show, I plan to talk about some of the things I’ve done this week that I hope will make my finances better next year.

Also, if you’re trying to decide whether to buy or lease a car, www.Edmunds.com reports that the number of folks leasing cars rose 21 percent in 2006. Here’s what they say you should do if you’re going to lease a car (and we’ll talk about this more on tomorrow’s show):

Limit your down payment:
Contrary to popular belief, down payments are not necessarily required for leases. Down payments will help to lower monthly lease payments, but it is typically in the consumer’s best financial interest to put little or no money down to fully benefit from leasing’s low finance rates.

Negotiate your mileage limit:
Leases include a maximum number of miles that the car can be driven without incurring a surcharge, and that maximum is negotiable. The average consumer drives approximately 14,000 miles per year. Make sure your lease mileage limit matches your needs. Additional miles can cost up to 35 cents per mile, which can become a major expense.

Negotiate the price of the car:
Monthly payments are normally calculated based on the assumption that the car’s value is the manufacturer’s suggested retail price (MSRP).

Shop around:
Not all lease deals are heavily advertised. The automakers’ national and regional lease programs can be researched at no charge within Edmunds.com’s (www.edmunds.com/incentives/RebateController) Incentives and Rebates database. Individual dealerships can offer further discounts. Shop around for the lowest monthly payments and upfront costs.

Make apples-to-apples comparisons:
Leasing can be confusing because there are so many factors to consider: down payment, monthly payment, term of lease, allowed mileage, drive-off fees, interest rates. Evaluate all the factors as you compare and make a decision.

Finally, the IRS opens for business next week — but the forms won’t have all the right information on them, because they don’t include the Tax Extender’s Act info. You can find out what you’re missing on www.irs.gov.

I hope you’ll join me tomorrow, 11:00am-1:00pm (EST) or download the show later this week.

Published: Jan 6, 2007