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A lot of people treat writing off expenses like it’s a financial life hack<\/a>. The logic goes: if you can write it off, then it’s basically free, right? Not quite, according to personal finance expert Dave Ramsey.<\/p>\n Lauren from Toronto called into \u201cThe Ramsey Show<\/a>\u201d recently to ask a question plenty of business owners wrestle with: should you buy or lease a car if you can write off the lease as a business expense? Her husband thought leasing was the smarter move. Lauren wasn’t so sure.<\/p>\n Don’t Miss:<\/p>\n \u201cI\u2019m trying to decide whether to buy or lease a car,\u201d Lauren said. \u201cMy husband leases his car. I currently own mine, so I\u2019m used to not having monthly car payments. My husband thinks I should lease because we can write it off<\/a> through our business. I would prefer to buy.\u201d<\/p>\n Ramsey came out swinging.<\/p>\n \u201cYour husband\u2019s so wrong. It\u2019s unbelievable how wrong he is,\u201d he said. \u201cHe\u2019s not just a little bit wrong, he\u2019s like really wrong.\u201d<\/p>\n Ramsey broke it down: in Canada, Lauren and her husband pay about 45% in taxes. If they write off a 10,000 Canadian dollars ($7,100) lease payment, they reduce their taxable income by CA$10,000. But the savings only amount to CA$4,500 in taxes.<\/p>\n \u201cYou\u2019ve traded a dollar for 45 cents,\u201d he said. \u201cThat\u2019s a bad trade.\u201d<\/p>\n Trending: The \u2018ChatGPT of Marketing’ Just Opened a $0.81\/Share Round \u2014 10,000+ Investors Are Already In<\/a><\/p>\n Ramsey added, \u201cWise people do not spend money on their business and trade a dollar for 45 cents and call it sophisticated.\u201d<\/p>\n Even the argument that leasing keeps the car under warranty didn’t hold water. Ramsey pointed out that new cars lose 60% to 70% of their value in the first four years.<\/p>\n \u201cThis is just dumb, dumb, dumb,\u201d he said. \u201cIt\u2019s rationalization cuz he likes the car. Don\u2019t do it.\u201d<\/p>\n According to Ramsey, the idea of writing off a lease is usually just rationalizing a desire to have a nicer car<\/a>. \u201cHe just wanted to buy the car, and he tried to figure out some way to posture and act like it\u2019s smart,\u201d Ramsey said of Lauren\u2019s husband. \u201cBy the time you get through doing the math, you look not only not smart, you look just plain dumb.\u201d<\/p>\n