(FORTUNE Magazine) – Your family is clamoring for a new car, so it looks like curtains for that little cushion of cash you have in the bank. Then the dealer suggests you lease your wheels. The big advantage of leasing over buying is that you don't need to pony up a huge down payment. You'll have to give the dealer a security deposit, often equivalent to a month's payment, which is refundable at the end of the lease. You're also required to make the first monthly installment in advance. But on an average car, these outlays run to hundreds of dollars, not thousands. Realizing that many of their customers are strapped for ready cash, more auto dealers are making the leasing pitch. Says Steve Betz, a Pontiac marketing manager in Purchase, New York: ''Leases used to be designed for doctors looking for write-offs, but now they're aimed at the broad middle class.'' Even if you're not daunted by a down payment, leasing can still make sense. Your monthly payments will be lower than the bite on an auto loan because you are paying to use the car for two to four years rather than to own it. For example: A three-year lease on a Taurus LX would run you $486 a month, vs. $569 on a three-year 12.3% loan, with 10% down. That's the regular deal, but be on the lookout for specials. Luxury car makers in particular are heavily subsidizing deals. For example, recently you could sign a four-year lease on a $24,000 Saab 9000 for $369 a month. For certain people, leasing makes psychological sense. If you absolutely must be seen tooling around in the latest model, go for a two-year lease. Not only do you pay less per month, but you won't have the hassle of selling your car when it goes out of style. Or if you thrill to the idea of driving a more luxurious car than you can comfortably finance, lease your dream for less. Nobody ever mistook the auto industry for the Red Cross, so what's the catch? Answer: You build no equity in a leased car. Take the Taurus. At the end of three years you've paid out $17,483 and you're left with an option to buy the car for $6,359. If you exercise the option, your payments total $23,842. Buy the car initially, and your outlay is $22,281. Nor is leasing such a hot idea if you think you might need to break the lease. You'll face charges, perhaps thousands, to make up for the rapid depreciation not covered by your early lease payments.