When To Rent And When To Buy – A Guide

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renting vs. buying a home, rent vs. buy, home buying, home costs, clothing, home repair

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The following is a post by MPFJ staff writer, Toi Williams, who is a professional personal finance blogger of Fine Tuned Finances. She has backgrounds in personal finance, sales, and real estate.
Many of us have been conditioned to think that if we want something, the best way to get it is to buy it.

But, there are many situations where it may be better for us to rent the items that we want instead. It can be difficult to decide whether it will be more cost effective to buy an item or to rent one, but there are some guidelines that you can use to help you make the decision.

Here is how to decide when to rent an item and when to buy it:


One of the biggest expenses for any household is housing. Many financial experts will tell you that you should try to purchase a home as soon as you can because of all of the advantages of home ownership, but in some cases, it may be smarter to rent your home than it would be to buy it. Here is how to tell the difference.
When To Rent
One of the biggest factors when determining whether you should be renting a home instead of trying to purchase one is the amount of time that you plan to spend in the area. If you have just moved to a new area and are not sure if you are going to like it, it may be better to rent a home for your family for a few years so you can see how you enjoy the neighborhood. This gives you the option to move to another part of town without a great deal of hassle if you decide that a particular neighborhood is not for you.
People that have just secured a new job and have relocated to be closer to their employment may also find that it is more beneficial to rent a home at first. That way, if you find that the job is not what you thought it was or if your new boss is a tyrant, you will not have the weight of a home to sell holding you back from exploring other employment opportunities. It is also better to rent if you feel you may be promoted to another position at another location within a few years. It is never cost effective to buy a house that you will be in for less than five years.
When To Buy
If you have lived in the area for a significant amount of time and know that you will be living and working in the area for the foreseeable future, then it may be more beneficial for you to purchase a home in the area. Purchasing a home will often result in lower payments than you would have to pay each month while renting a similar sized home and you will receive the tax benefits from the government that are reserved for homeowners. You will also have more control over the property and what you can do with it, including decorating any way you want, obtaining pets, and changing the exterior of the home.


Outside of tuxedos for weddings, many people do not think about renting clothing to wear, but you would be surprised at the amount of clothing that is available to rent for people of all ages and sizes.

Because clothing can be expensive, it often doesn’t make sense to buy all of the clothing items that you desire for all of the occasions that come up. Here is how you can make the decision on what choice will be best.

When To Rent
For almost every special occasion, it will be more cost effective to rent the clothing that you need instead of buying new items. Special occasion dresses for women can cost hundreds of dollars, and suits for men can be even more expensive. In most cases, the main clothing items that are worn for these occasions are only worn once and then are left in the closet for many years untouched. Special occasions when you should consider renting clothing include weddings (especially wedding dresses and tuxedos), proms, and captain’s dinners on cruise ship vacations.
When To Buy
It is best to limit your clothing purchases to things that you will be wearing frequently and things that will last from year to year. Staple items, like t-shirts, jeans, and work clothes are always good purchases because you will get your money’s worth of wear out of them. The cost per wear ratio gets even better if you are able to purchase these items when they are on sale or on clearance. You should also buy the clothing items that you know you may need multiple times over the next few years, like a black suit for job interviews and funerals. Purchase shoes that can go with multiple outfits instead of unique ones that only match one or two items in your closet.


Buying tools can be very expensive, especially if you need specialty tools for a home improvement project. Fortunately, you do not always have to buy a tool to be able to use it for what you need. In many cases, it may be better to rent the tool than to purchase it outright. Here are some signs that can help you make the decision.
When To Rent
If you will only be using the tool for a specific project, like remodeling the kitchen or removing a tree from the backyard, it is often more cost effective to rent the tool for the length of time that you need it. Once you have used the tool, you can return it to the home improvement store that you rented it from, paying a fraction of the price of purchasing the item and saving valuable storage space in your home, shed, or garage. Renting a tool is also good if it is the first time that you have ever used that particular type of tool, so you can see how it works and how you like it before you decide to buy.
When To Buy
If you know that you will be using a tool frequently or for multiple projects, it will be more beneficial to buy it and have it on hand than to run back and forth to the store to rent it every time it is needed. Tools that are purchased should be versatile and you should be comfortable in its use before you decide to purchase it. Every home should have a toolbox with basic tools in it to handle basic home and appliance repairs, but other specialty items, such as chainsaws, demolition hammers, and electric sanders, should only be purchased if you are sure that you are going to be using it multiple times during the course of a year.
How about you all? Do you typically rent items you use infrequently, or do you just buy instead? What items do you usually rent?
 Share your experiences by commenting below!

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