Cycle to work scheme - is it worth it?

dawny10

Marco_Panettone wrote: »

That's not the point though - you still get a bike to keep and use whenever you want for less than the RRP. If you look after it the bike will last you for many years. You get to use it at the weekend, through the summer, whenever you decide it'd be nice to go for a ride.

It's all about choices of how to travel (which you still have). Cycle when you want, just on a bike that was cheaper to purchase. Cycling is 'worth' more financially the more you do it, but that remains an individual decision.

Exactly - I wanted a new bike and knew which one I wanted, as its from Decathlon there are unlikely to be any 'sale' reductions I miss out on so I get to save about 30% and pay over 18 months for something I was going to buy anyway. No brainer for me!

browneyedbazzi

I'm thinking about getting a bike through a cycle scheme - the options through my employer are cycleplus (which allows you to go to participating independent cycle shops) or cycle2work (Halfords).

My one query about the scheme is do you have to buy a bike at full price or can you take advantage of offers? If you can buy a bike at an offer price then I think it's great value but if you must pay full list price then the scheme savings start to disappear (especially when you consider the uncertainty about what the final payment to keep the bike will be at the end of the hire period and since I'm not a higher rate tax payer). Does anyone know?

johnmc

Cycle schemes are not that good. They are a lease agreement. You never own the bike.

Better to look for low or 0% schemes and shop around.

And how many are actually used to get to work?

browneyedbazzi

johnmc wrote: »

Cycle schemes are not that good. They are a lease agreement. You never own the bike.

Better to look for low or 0% schemes and shop around.

And how many are actually used to get to work?

They are a lease agreement but usually include options at the end of the term that allow you to own the bike.

0% finance is another option but that doesn't give the tax advantages of the cycle scheme...so if you can buy a discounted or non-list price bike and use the cycle scheme for tax relief you could end up considerably better off than on a 0% finance deal.

As for how the bikes are used - I know several people who have purchased through cycle schemes and regularly cycle to work. I wouldn't commute to work on mine but want to get a folder so I can use it to getting to/from various sites during the working day (because I have to do a lot of site visits and parking for the car is a nightmare in a lot of places where I work). Others may get bikes through the scheme and just use them for leisure - it goes against the spirit of the scheme, but doesn't really affect the value of using the scheme compared to buying a bike outside the scheme.

beardedgelfling

It’s not as black and white as good or bad.

You have to use your brain and work out if it any good for you, and how you want to use the scheme. If you want it to help you save cash on purely commuting costs then it’s not going to be so great. If you’re looking at this as a cheap way to get a top notch entry bike on a poor credit rating with 0% interest and a good 20%+ of the RRP (including one off end payment) – like me this is a good way to go.

I live in Devon and the using the DCC cycle to work scheme I get paid gross salary of about £18,000 give or take (good wage for the south west if you could believe it). I'm gone for a Defy 1 at £1000. That's works out at £83.33 a month that gets taken out of my wages before any other deduction. Meaning that an effectively I'm paying out £58.53 a month. So the final cost for me would over 12 months is £706.

At this point I can buy the bike for 25% of its value from DCC and it's mine. OR and it’s a big OR. I can place a deposit of 7% of bikes cost and extend the hire for another 3 years from the cycle2work scheme. So that’s a £70 deposit to pay out (which is not a lot of money in real terms as you have 12 month to prepare to pay that out).

After this point I can give them the bike back and get my £70 deposit back or keep the bike and not get my deposit back meaning that final cost of the bike is £776 so that's a saving of £227 on a brand new Defy 1 that I can ride as if it was mine for the full 4 years of the extended agreement.

It really is worth it for most people. I’m not on a huge wage or in a high tax band but even I can save a bunch on this scheme and I get a new bike. Now weather it works out cheaper than commuting to work I think is somewhat irrelevant as the point of this scheme is to help you lower greenhouse gases and improve your health saving cash on fuel is do able so long as you don’t go over about the £600 mark. Which will get you a nice bike; one that is more than adequate for commuting.

If you purely about save money, get up extra early and walk to work as this is clearly the cheapest and healthiest way to commute! Just because this does not work for everyone does not means that it’s bad, or if you think 15-20% off RRB of a new bike is not worth it then don’t do the scheme. To say that this is a bad deal when you save money on a new bike I think is unfair.

I found all the info on the cycle to work scheme to be great. It was very clear, transparent, and easy to navigate and get all the info you need to make an informed decision. Try the saving calculator it’s a great way to see how much you can save on the hire costs - this is a little misleading as it doesn’t take into account the last one off payment, but this is because this depends on other factors but it won’t be more than 25% or less than 3%

It would cost me £44 a month to get the bus to work on a weekly ticket. So purely on that I’m making a loss on my cost to get to work, but the other benefits from cycling I think more than outweigh the small elevated cost of commuting.

I’ll be spending an extra £14 a month on my bike but this also gives me the freedom to ride to other places rather than getting a bus, or driving. I also quit smoking due to getting onto my bike so this will save me £100+ a month too and helps with the health thing again.

If I’d gone for a bike at about £700-750 I’d be breaking even. So if I wanted to save money I could have gone for a bike at £600 that’s £35 a month so then I’d be saving money. But I’m, really getting into my cycling so it make sense in the long rung to go for the better bike at £1000 rather than cheeping out and having to upgrade outside the scheme later…

Marco_Panettone

You've also just costed the bike for 1 year. If you commute on it for 3+ years it saves you even more.

Not bad for an additional £14 a week for a year!

Moto2

After this point I can give them the bike back and get my £70 deposit back or keep the bike and not get my deposit back meaning that final cost of the bike is £776 so that's a saving of £227 on a brand new Defy 1 that I can ride as if it was mine for the full 4 years of the extended agreement.

I think it's very marginal unless you're a higher rate tax payer
You can find a Defy1 discounted to around that price anyway

goonarmy

Its a good scheme. My employeers use evans. And the lads at work all use it. None of them comute on the bikes as they have company vans required for their work. They have bought mountain and road bikes and safety equipment for themselves and family members at a discount rate. They do own the bikes outright. The only problem they have had is a couple have overpaid by one or two payments which was rectified the following payday. Our scheme is quick and simple although evans arent always great. I have known them to tell our guys that bikes are being built ready for collection that arent in the store. But that is them not the scheme.

beardedgelfling

Moto2 wrote: »

I think it's very marginal unless you're a higher rate tax payer
You can find a Defy1 discounted to around that price anyway

Can you find a new Defy 1 2014 at that price... No.
Can you find a new Defy 1 2013 at that price... Not likely
Can you find a new Defy 1 2012 at that price... Only if your very lucky
(that's assuming any are still on sale new).


Reason being the bikes not changed in at least 3 years hence the new paint job to make it look new and different. However it's the same frame, same spec's, same price... only difference is colour scheme. So any bike shop selling them for £250 less than £999 is being stupid beyond belief... Still that's not to say it will never happen, just not often.

Also as shops selling bikes on the scheme are out of pocket by 10% by all accounts. So they will be very unlikely sell bike of a sale price on the scheme. I tried this on £1300 Cube down to £999 but they wont sell it on the scheme at that price because they are already making a loss on the scheme.

I don't quite get this part, as surly if that was the case... why would any shop join up?


A £220 saving is not marginal, £5 is marginal. If you think £220 is a marginal saving you clearly have/earn a lot more money than I do, or have no concept of the value of money.

This is also a 0% interest scheme at no point will you EVER be charge interest.

You make payment out of your wages so you will never miss a payment as it all happens at payrol before you get your payslip.

You make about a 20-30% saving on a normal wage/tax like me.

It really is a no brainier as far as I can see. Anyone that thinks it's a bad scheme then I'd like them to say how and why... not just offer conjecture and the subjective opinion without any explanation as to how they came to that conclussion.


On a side note; some people are getting scheme's confused there are at least 2 national schemes running one is 'bike to work' and the other is 'cycle to work'.

Cycle to work seems to be more aimed at local bike stores around the UK helping to support local business, green living and good health.

Where as bike to work seems to be aimed at large national companies like Halfords and a like. My employer is only doing cycle to work scheme so not sure on the exact details but they are different and easily confused...

Moto2

Well, a 2013 Defy is pretty easy to find under £800, a 2014, probably not
But the scheme isn't about Giant Defys, there's loads of other bikes out there that are discounted when bought normally but not with the cycle to work schemes.
There's loads of 0% credit cards out there.

One of the largest suppliers of entry level bikes in the UK - Planet-X charge you a fee of up to 12% for using the scheme to get a bike and they're not the only ones.
You are unlikely to get any discount off the bike from anywhere as they have to pay the scheme 10 or 12%
I've bought many, many bikes over the years and always had discount

As for a fiver being what you'd call marginal on £1k, I'd say about 10% would be for me for various reasons
What happens if you leave before the lease expires on your scheme bike?
Maybe you'll be made redundant?
Who owns the bike you've been making payments on?

I think the savings are probably worth it for higher tax payers but not always for lower rate payers, it'll depend what you want and what's available to some degree.
I would never listen to any one that simply said it was great and you're wrong to question it.
By all means use a scheme but do your sums and research first because it's not always the best option.