Best car leasing deals for young drivers

  • How young people can get leasing deals 
  • The best cars to lease for young people 
  • Is leasing available with free insurance?

If you've Googled this; there's a good chance you already know what leasing is. But if you've come across this article in a different way, it's worth repeating.

Leasing, sometimes referred to as Personal Car Leasing, or Personal Contract Hire (PCH) is effectively a form of long-term renting.

After an initial payment, fixed monthly payments are made for a predetermined amount of time. Then that's it - once you're done you need to search for another car. Typical contract length is around two to three years.

Strictly speaking, leasing is unavailable to drivers under 18-years old. Although a lot of leasing companies have a minimum age limit of 25.

Did you know that generous British parents spend an average of £3,410.30 on their child’s first car?


Car leasing with free insurance 

2018 Fiat 500 front

Leasing with free insurance, especially for young people, is hard to find. Most leasing companies will not offer free insurance.

There are a few specialist finance companies out there that offer cars with free insurance if you take up a Personal Contract Purchase (PCP) deal.

Although marketed as 'free' it's essentially just a bundled price for your PCP deal and insurance together. It's always worth shopping around for insurance deals to see if you can pay less by buying insurance separately.

If you like the idea of bundling motoring costs together, research Peugeot's Just Add Fuel, or Citroen's SimplyDrive. They both offer cars where the monthly costs, tax, insurance, and servicing are bundled into one payment. Volvo reckons that its bundled option, named Volvo Care, will make up 50% of its sales by 2025.

>> Car leasing with no deposit

The best cars to lease for young people:

Need a bit of inspiration? Parkers is here to help. All the cars on this list have low running costs, enough kit for day to day life, and car insurance premiums that aren’t out of this world.

1. VW Up 
2. Fiat 500  
3. Toyota Aygo 
4. Fiat Panda 
5. Dacia Sandero 
6. Vauxhall Corsa 

7. Ford Fiesta 
8. Volkswagen T-Cross 
9. Smart EQ Forfour

1. Volkswagen Up

2019 VW Up front

The Up is the benchmark of the city car class - a sector almost entirely dedicated to the young and old. Inside it feels every bit the junior VW - it's not exactly flash, but it's well put together and has grown-up bits like phone connectivity.

Despite a compact shape, there's still enough room for four adults. Boot space is up there with the best (251 litres), while economy reigns supreme at 68.9mpg for 1.0-litre models. Insurance group ratings of 1-4 (depending on spec) help keep insurance costs rock bottom too.**

Leasing price: from £185 per month
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2. Fiat 500

Fiat 500 in white, with Italian colour decal

While similar in size to the VW Up above, the 500 is different in outlook. The Up is utilitarian and practical, while the 500 is a chic throwback that oozes style.

Front seat passengers get a lot more space than rear ones, and the 185 litre boot is small too. The Up has a practically cavernous 251 litre boot in comparison. But Fiat 500s are cheap as chips with leasing deals. Insurance groups are slightly higher than the Up, though.**

Leasing price: from £139 per month
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3. Toyota Aygo

The Aygo treads the path between the 500 and Up. It's distinctive like the Fiat, and practical like the Volkswagen.

The interior does feel a little older, and a little cheaper than almost every other car on this list. It is however, made by Toyota, a company that regularly tops the charts as one of the most reliable car brands.**

Leasing price: from £144 per month
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4. Fiat Panda

2012 blue Fiat Panda front

The Panda is a very, very different car to the Fiat 500, despite sharing a lot of mechanical components. It's not out and out fashionable, but it doubles down on value for money.

Its square, squat like proportions make it practical too - boot space measures in at a whopping 260 litres, while there are 14 cubbyholes inside. Just think of the cables, chargers, and McDonald's wrappers you can stuff in them.**

Leasing price: from £151 per month
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5. Dacia Sandero

Dacia Sandero side

The Sandero is famously (well, within the right circles) Britain's cheapest new car. From new, it costs £6,995, and for that price you get daytime running lights, tinted windows, and not much else.

It's incredibly cheap price does of course translate into cheap monthly lease deals. And it is a good bit bigger than the likes of the VW Up too. Just make sure you get a Comfort spec model if you want Apple CarPlay and rear parking sensors.**

Leasing price: from per month
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6. Vauxhall Corsa

Vauxhall Corsa five door moving

There's a new Corsa in showrooms right now, which means you can expect deals galore on the already inexpensive old version.

It isn't the best car in class, but, with discounts included, it's a compellingly cheap option, especially if you're looking for a short-term deal. Cheap insurance, too.**

7. Ford Fiesta

2017 blue Ford Fiesta front

With a range of quality engines, exciting handling, and the practicalities of a much larger car, it’s easy to see why the Ford Fiesta is the best-selling car in the UK.

The Fiesta was awarded a five-star (out of five) rating by Euro NCAP and received particular praise for its programmable ‘MyKey’ system, which allows parents to set maximum speed and stereo volume limits for their children. The broad spectrum of engines range from economical to fast. Unsurprisingly, slower = cheaper to insure.**

Leasing price: from £181 per month
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8. VW T-Cross

2019 VW T-Cross driving

We understand that not all young people are carefree singletons that just want something small and cheap. Some young people have bigger commitments and need a larger car.

The T-Cross has a raft of small and economical petrol engines, and with a boot size of 450 litres, it's large enough to accommodate small families.

Most versions sit below insurance group 10 too.**

Leasing price: from £178 per month
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9. Smart EQ Forfour

2017 Smart Forfour EQ moving

An electric car might seem a bit of a left-field choice for a person without much experience driving, but there's method to our madness here. Electric cars are extremely easy to drive - there are no gears. Put it in D (for drive) and whoosh away in near silence. Electric cars are notorious for instant power. And while the Forfour feels reasonably quick off the line, it's still not in the least bit quick.

This results in a low insurance group rating, ergo, reasonably priced insurance. As the name suggests, it seats four people in comfort, and it's easy to park too.**

Leasing price: from £156 per month
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Read these if you're young: 

If you’re young and researching your first finance deal, make sure you read these articles too.

If you're looking to borrow money and get a great cash-price deal, then visit our Car Finance Calculator tool to work out your monthly payments.

** These deals are indicative examples of some packages available as at 2 March 2020, but are subject to change without prior notice. Everyone's financial circumstances are different and the availability of credit is subject to status. Terms, conditions and exclusions apply. Parkers cannot recommend a deal for you specifically.

Bauer Consumer Media Limited is an appointed representative of ZenAuto Limited for the broking of regulated consumer hire agreements. ZenAuto Limited is authorised and regulated by the Financial Conduct Authority. ZenAuto Limited's registered office is Number One, Great Exhibition Way, Kirkstall Forge, Leeds LS5 3BF. ZenAuto Limited's company registration number is 10967345. ZenAuto is the trading name of ZenAuto Limited.