Leasing a car is distinctly different from buying and owning one. Leasing may be all wrong for you -- or perfect for you. The trick is to work out what is affordable -- and the best deal. Filling in our questionnaire below will help you determine if you are a Likely Leaser, a Natural Born Buyer, or somewhere in between.

LEASING TEST
Your answers to these questions will help determine if you are a good candidate for leasing:

1. Do you typically trade for a new car every four years or less? Yes____ No___
   
   
2. Do you want to avoid a down payment of 20% or so of the car's price that is typical with a loan? Yes___ No__
   
   
3. Do you hope to be driving a more expensive model than your current car or truck? Yes__ No___
   
   
4. Do you typically drive less than 15,000 miles a year? Yes___ No___
   
   
5. Do you typically keep your car or truck in good condition, following maintenance schedules and washing it frequently? Yes__ No___
   
   
6. Do you hate the idea of having to sell or trade your used car when it is time to get a new one? Yes___ No___
   
   

If you gave four or more "Yes" answers to these questions, you at least want to consider leasing.

PLUSES AND MINUSES
Leasing is the easiest way to get a new car every few years while letting the dealer or leasing company worry about disposing of the old one. In a "closed-end" lease -- which describes almost all leases being offered by dealers and manufacturers -- the value of your car or truck at the end of the lease will be fixed in advance. Usually, you will have an option to buy it at or near that price if you decide to hold on to it rather than lease or buy a new one. Since payments are based not on the total value of the car but only its depreciation while you are leasing it, you might, for instance, be able to lease a $47,850 Mercedes E320 for monthly payments similar to those on a loan to buy a $33,928 Buick Park Avenue Ultra. As a result of such math, more than 70% of new-car transactions are leases for some luxury nameplates such as Jaguar.

But leases have some major disadvantages. Potentially one of the biggest -- especially if you are not accustomed to leasing vehicles -- is that you are forced to make a major financial decision when your lease expires. You must either turn that car or truck back and buy or lease a new one or alternatively decide to exercise your option to buy the vehicle at the lease-end price known as the "residual value." On the other hand, if you own your car or truck, you can postpone any decision about replacing it at least until mechanical trouble forces your hand.

BUYING TEST
These questions will help you determine if you are a better buyer than leaser:

1. Do you typically keep a car for five years or more? Yes__ No___
   
   
2. Is the idea of finishing with loan payments and owning your car or truck free and clear important to you? Yes___ No___
   
   
3. Can you readily come up with the down payment of 10% of the purchase price that is typical for most car loans? Yes___ No___
   
   
4. Are you casual or even careless about maintenance and keeping your vehicle clean? (Be honest now). Yes___ No___
   
   
5. Are you annoyed by the idea that the dealer or leasing company may charge you a penalty if you want to end your lease early or if you return the car or truck in a condition that does not meet their standards? Yes___ No___
   
   

Three or more "Yes" answers -- especially if they include questions 1 and 3 -- makes you a good candidate for buying rather than leasing. Buying a vehicle and driving it until it drops is almost always the least expensive option. In that case, once your loan is paid off, you still have several years of payment-free driving ahead. And if you are among the lucky car or truck owners (22% recently) who are able to pay cash for your vehicle, so much the better. You are avoiding all the interest charges that you would be paying with either a loan or a lease.

NOT SO SIMPLE
But the question is not always that simple. If you would have to sell stocks or other prospectively profitable investments to raise cash for a new car, you might wind up ahead in the long run if you keep that investment in place and go for a lease with its low up-front cash requirement (typically just a security deposit equal to about one month's payment plus the first month's payment in advance). Some leases require a down payment (known in leasing jargon as a "capital cost reduction"). But the best leasing deals avoid any down payment.

Jerry Edgerton is a senior writer for MONEY MAGAZINE. To read more of his articles, visit the archives of Money.com at http://www.money.com. Jerry is also the author of CAR SHOPPING MADE EASY: BUYING OR LEASING, NEW OR USED.