New economical car on finance or older used car for cash?

Lgas

I've decided it's really time to buy myself another car, as I have no other means of transport apart from expensive taxis, and I wouldn't get on a bus where I live!

The trouble is pretty much every car i've ever owned has been a bit of a banger, i've only ever paid £1000 or less, and i've ended up either spending hundreds of pounds within the first few months, or as in the case of my last car, just giving up and scrapping the thing (multiple problems with a 1997 polo!).

Now the choice I have is to either get another used car; I have up to £1000 cash if my OH chips in, and a more knowedgeable person to take with me to viewings, or get a new car on finance. The 2 I am looking at in particular are the 1.0 Kia Picanto and the Hyundai i10 1.0 blue (both featured in the Daily Mail's top 10 cheapest cars to run, and both free to tax).

The Kia has 7 years warranty plus a year's free breakdown cover, and the Hyundai has 5 years warranty plus 5 years free roadside assistance etc. I've found the Picanto seems to have slightly better depreciation value.

I have enough income to have a new car on finance, but can't decide which is better - older car: costs more to run, may have expensive problems to fix, tax to pay for every year, but not adding to my fixed financial outgoings every month. New car - cheap to run (figures estimate 67 mpg for both models!), free to tax, covered by long warranties, but set payments coming out every month for finance.

Any thoughts? I've obviously never bought a new car before and always said I wouldn't because it loses so much money just being driven out of the showroom, but with these models, because they are relatively cheap, it doesn't seem to be the case. I would be keeping the car for as long as is practical - no kids or dog, only me, OH, and friends to ferry about.

Lgas

Thanks! I've been looking in it a bit more and I can definately get a car under 5 years old, fairly low mileage, that is quite cheap to tax, for £3000 or less, I haven't been able to find a lot for £1000 or less but it would be cheaper, not to mention a better APR, to top up my nationwide loan and get something that will hopefully last me a bit longer, rather than giving myself another loan/payment plan. I've finally got a well paying job and it would be nice to have something modern but reliable. After graduating I bought a 7 year old daewoo matiz (don't laugh!) for £1000 in 2007 and spent hundreds and hundreds on it in the first few months, it's just such a minefield.

forgotmyname

Buying new is madness i buy cars that are 4 or 5 years old usually high mileage because i dont do many
after a few years it evens out but i paid less for it.

£2000 ish is my budget when swapping. Keep them for about 4 years.

New car £6k which is only worth £4k after adding your name to the logbook, But with interest you owe £9k over 5 years?

Madness....
Buy something well looked after and not the posh model with all the electrics waiting to fail and empty your pockets.

If you had spent hundreds in the 1st few months you should have sorted everything and had a reliable car after or is that
wishful thinking?

Wh05apk

I recently bought a car for my daughter, initially we were looking about £1000 level, but at that price there is a lot of rubbish out there, I am not saying you will not find a good car, but you will spend a long time looking, or be very lucky, in the end we went up to £2000 and at that level there are a lot of good cars around, unless you are doing a lot of miles don't worry too much about fuel costs, look for something reliable, and better condition, a £200 unexpected repair bill, would have paid for a lot of additional fuel.

At the £2000 level small cars are very popular as first cars, and are relatively expensive, for the same money, you could probably buy a larger/better equipped car a year or so newer.

sunshinetours

Again how people can advise without knowing your mileage likely useage I am not sure?
The fact that you would keep it for as long as possible also doesn't automatically rule out a brand new cheap car with decent warranty either.
Petrol prices and road tax are not going to go down over the next 5-10 years are they? So the new car doing 60mpg + and fre road tax for now at least doesn't look so bad over its lifetime maybe (depending on annual mileage)

Hammyman

Say you buy a new car for £6000 on finance which costs you £7000 in total. 3 years later you you sell it for £4000. That car has cost you £3000 plus any repairs it'll need.

Have any of the £1000 cars you've bought cost you £1000 a year in repairs?

Wireless_2

Personal Car Purchase (PCP), and give the car back after three years?

The wife uses a car for business, and the cheapest deal is PCP over three years, rather than Leasing, she just has Insurance and Diesel to pay for, and judging by her last PCP deal, which ended last Summer, she'll buy one new tyre during that time, plus a Service every 12.5k, which doesn't have to be a main dealer, covering 45k in total. After three years she just hands the keys back, and takes out a new deal on PCP, just choose a model with free road tax, and not even that is a problem.

78.2 mpg is the best daily average she's had so far, but regularly gets over 66 mpg, and it's a 1.6 diesel.

What about the TV deal from Peugeot, £99 a month and just add fuel?

As the other poster says, unless you sit down and work out your average mileage, and the type of journeys you normally take, and the mpg of a particular old car you're looking at, it's road tax, whether it'll pass its next MOT, and how much it will affect your insurance premium, you'll never be able to compare it with a new car on PCP.

BTW, I don't know anyone who actually buys a new vehicle on HP, thats such an expensive way of motoring, and means you're saddled with the same vehicle for five years or more, and start worrying about whether it will pass it's next MOT, stuff that for a game of soldiers.

King_Nothing

I personally wouldn't pay to rent and drive someone elses car for three years, then give them it back at the end.

sunshinetours

Hammyman wrote: »

Say you buy a new car for £6000 on finance which costs you £7000 in total. 3 years later you you sell it for £4000. That car has cost you £3000 plus any repairs it'll need.

Have any of the £1000 cars you've bought cost you £1000 a year in repairs?

What about the £4000 cash you now have......

And the potential reduced fuel and road tax costs....

As i said its never that straight forward without all the facts