You have seen it on the Television, heard it on TV "FlexiRent to save", "FlexiRent to get the latest technology", FlexiRent to save tax". In reality FlexiRent is far from what they promote it to be! Lets step back and take a look at some of the facts. In the promotions for Flexirent, they promote the tax benefit of renting your equipment and if you are using it for business purposes you can claim the tax back. All their pricing claims use the assumption that the equipment will be used for 100% business use. In reality unless your FlexiRented computer never leaves the office you can never claim that amount. Lets use the FlexiRent Quote tool on their web site. Lets say we are going to buy a Notebook computer for $2700.00.

• Over 36 months this will cost you $135.54 per month. Over the duration of the "Lease" period this will set you back $4860!
• Over 24 months this will cost you $170.64 per month. Over the duration of the "Lease" period this will set you back $4095!

In both scenarios above you are paying significantly more for the product. Due to a loophole in Australian leasing and renting laws FlexiRent do not have to disclose the full term rental amount to you in the rental contract! So there are quite a few people who get stuck in these agreements when stores such as Harvey Norman have sales on. The sales reps at the stores get commission from FlexiRent for every customer they sign up. This can range from cash incentives, Playstations to holidays! So beware of staff who will push you into a FlexiRent term to get their summer vacation. The sales rep will usually compare the monthly costs of the 3 year FlexiRent to the 2 years interest free, as the monthly payments between the two are fairly similar. The extra cost in the FlexiRent will be explained as insurance premiums and accident cover. Lets look at the cost of the same $2700.00 notebook with a standard 2 year interest free structure.

• Over 24 months you will make monthly payments of $112.50 plus a monthly service fee of $2.95.

So when you think about it, getting this notebook on interest free is only going to cost you an additional $70.80 in account keeping fees, compared to the $2170 in pure profit that FlexiRent is making out of you. At the end of your 24 month interest free period, you have a laptop to keep forever. At the end of your FlexiRent period you have to pay a "small amount" deemed by FlexiRent to own the equipment that you have rented. If you don't you can either keep paying the monthly cost or upgrade to a new machine. Now this is where it starts to get messy. FlexiRent will encourage you to upgrade your machine starting from 12-6 months before your lease finishes. When you take out your new lease for your upgraded computer you are not getting anything for your existing machine, you are adding to the balance of your existing FlexiRent term. Using the same example above, we still "owe" $1631 with 12 months remaining on the contract. If you were to buy a new computer at 24 months of the 36 month term, they would give you the cost of 1 or 2 payments for the current machine then add the cost of the new machine on to of the balance. So if your new machine cost $2500, $1631 (Existing Balance) - $270 (FlexiRent Payment for Goods) + $2500 (Cost of new Goods) = $3861 (Total cost of new FlexiRent term)

• Over 36 months this new agreement will cost you $187.26 per month. Over the duration of the "Lease" period this will set you back $6741.36!

As you can see, the further you get into FlexiRent the bigger financial hole you start digging yourself into. The contract that you sign with FlexiRent pretty much give you no rights as a consumer at all. For starters, there is no cooling off period if you change your mind about your purchase. If your equipment fails and FlexiRent don't want to fix it, you are left with nothing and a bill. If you want out of the contract or want to increase your payments to end your term sooner you can't. They won't even negotiate with you. So from the above, you would have worked out that FlexiRent is pretty much a big scam for cash, to suck in any unsuspecting person who wants a computer and wants it now. Just a a comparative, I have included the same example using Dell's rental plan calculator.

• Over 36 months Dell will charge you $110.48 per month. Over the duration of the "Lease" period this will set you back $3977.
• Over 24 months Dell will charge you $140.77 per month. Over the duration of the "Lease" period this will set you back $3378.

Dell finance has a saving of nearly $1000! You are still paying more for the product in the long run, but it just puts into prospective how much FlexiRent are gouging their customers, plus with Dell finance you actually own the equipment once the rental term is complete. As you have probably guessed, the main point of this blog is to advice you to STAY AWAY FROM FLEXIRENT and also for you to be careful when purchasing a big ticket item. If you cannot afford to lash out the lump sum, should you really be purchasing the goods? Do your research and check the total cost of the rental agreements. After the sales assistant has worked out the cost, walk away think about it. Do some calculations. Ensure that you know the financial commitment you are about to make.