Q: Okay, Dr. Skousen, since you're so smart, what's the answer to this one: Buy or lease? My car dealer says that a lease is a much better deal, but I'm still not sure. What's your view?

A: The answer may surprise you: buy a formerly-leased car!

You have three options: (1) Lease a new car, (2) buy a new car or (3) buy a used car. The first option is clearly the most expensive. Yes, leasing has its advantages. You get a luxury car with nothing down, low monthly payments, hassle-free repairs and a guaranteed buy-back. One out of every four cars is leased today. But there is no free lunch. You pay for this convenience out of your pocketbook. And buying a new car means losing 20% or more of the value of your purchase the day you drive it off the lot.

If you want to save money, check the classifieds and buy a late-model used car, preferably two to three years old with low mileage (25,000 or less). Look especially at used-car lots operated by major dealers. That's where the bargains will be found over the next few years, as a glut of leased cars come onto the used car market.