Best Way to Finance a £30-40k car?

davidjwest

Iceweasel wrote: »

I am newly retired and will probably never buy another new car again - as a private individual.

My plans are the same, retire in ten years or so and treat myself to something with the lump sum from the pension - although mine will be more modest I suspect.

Depending on the stock market and how much the government robs from me, maybe £30k if I am lucky.

Good luck and happy retirement!

Dimey

Would you consider a Toyota RAV 4 or a Mazda CX5?

Your £25K could buy top of the range without the need for finance. More economical and more reliable than the Range Rover.

http://www.autoblog.com/mazda/cx-5/

http://www.autoblog.com/2013/04/16/2013-toyota-rav4-review/

alleycat`

Concur with TradePro, the new santa fe is a gem and well worth a drive.
You just have to get past the badge, which i accept, some people just can't

alleycat`

Dimey wrote: »

Would you consider a Toyota RAV 4 or a Mazda CX5?

Your £25K could buy top of the range without the need for finance. More economical and more reliable than the Range Rover.

http://www.autoblog.com/mazda/cx-5/

http://www.autoblog.com/2013/04/16/2013-toyota-rav4-review/

I thought the top of the range rav's and cx5's were pushing 30K?

tired_dad

My comments

1. You earn your money and that gives you the right to spend it how you want. If the OP wants to spend 40k on a car, then that is his/her prerogative. I'm assuming therefore that the OP has the earning potential to justify this sort of expense. Therefore I will not give any advice about spending less.

2. In terms of financing such a purchase, this issue really hinges on a simple calculation of how often do you want to change the car. If you are the sort of person who wants to have a new car every 3y and does average miles, then some form of lease deal is a no brainer. You are committing yourself to a life of car rotation every 3y and you will pay for the privilege. Most of the depreciation occurs in these years. You will pay for that + the interest on the loan amount etc etc. The industry is wedded to getting customers into the car rotation trap. Some people love this and that is fine. Most new 40k+ cars on the road are owned by people who cannot afford them but are renting them. This is the reality of modern life.

3. Modern cars are generally well made and if looked after will last for years. If you are the sort of person who will keep your car until it falls apart, then by far the cheapest way to own is to buy outright. Pick the end of a quarter and most dealers will give a hefty discount to a cash buyer if they need to sell to a deadline to get their bonus. So assume 5-10% off the list price for a start. Then the longer you keep the car, the cheaper the annual cost to run.

My friend buys an eclass merc for 30k in 1999. That was a lot of money in those days. Still drives it and its perfect. Even if the car is worth £1k now, thats 2k per year ownership costs versus 7-10k if he was in the lease trap.


Its totally up to the OP and his/her lifestyle. Whenever I have bought a car, i've done the figures and always calculated that buying outright is the least expensive way of owning a car. ALso the most secure because at least you own the entity so if financial situation changes (life is uncertain) at least you don't have to hand the car back. That is my personal preference but many of my friends lease and I have no problem with that. Just don't lease thinking you're doing yourself or the dealer some sort of favour. Its always about extracting maximum $$ from the customer, just dressed to look like a investment.

A car is never an investment (except a few classics). Its the one thing we have that it tantamount to piling cash and burning it.

redux

How keen are you on a 4x4, and this idea of treating yourself?

I'd say stick with your previous spending scheme, and go for an estate of a less expensive brand.

Citroen C5, Seat Exeo, Skoda Octavia or Superb, and you could get one under a year old with just a few thousand miles for £14 to £16,000.

I haven't done the sums, but that could work out over £100 a week cheaper across 3 or 4 years.

Dimey

alleycat` wrote: »

I thought the top of the range rav's and cx5's were pushing 30K?

I was thinking £22k. Must be out of touch Ha Ha!

Tiptop2000

Thanks all, its a tough one. The need for a 4x4 & estate is driven by always carting around the dog, plus luggage to my in-laws and my Mums in Cornwall. Plus a little one is imminent, all being well.

In all honesty I find most 4x4's just lacking in interior quality before I even drive them. I want the cabin to feel a little special, not Aston Martin but be a nice place to sit. I find that most 4x4's are purely functional and that their interiors lack any elegance. The only ones I am considering are Audi Q5/Q7, Volkswagen Toureg, Land Rover Disco and Range Rover.

In terms of the estate cars I like the performance/power of the BMW diesel estates (335d or 535d), but they come with a price. Albeit not much more than a second hand RRover. I do actually like the Skoda estates but doubt the wife would let me have one.

Money wise I think buying it seems OK, we have good enough income to support a £30-40k car. Its just I have never spent that sort of money so wanted to consider finance options.

Great advice, car searching tomorrow on the forecourts to get a feel for cars.

redux

Skoda Superb or Yeti TDI 170 bhp 4x4 then, for around £20,000.

Get your wife to read some reviews of them. The time to look down a bit on Skoda ended years ago.

Someone I know had a Touareg, and got fed up with things going wrong, and now owns something similar Japanese, probably Toyota.

TradePro

Tiptop2000 wrote: »

In all honesty I find most 4x4's just lacking in interior quality before I even drive them. I want the cabin to feel a little special, not Aston Martin but be a nice place to sit. I find that most 4x4's are purely functional and that their interiors lack any elegance. The only ones I am considering are Audi Q5/Q7, Volkswagen Toureg, Land Rover Disco and Range Rover.

It's important that the ambience in the cabin is just so as you sit on the hard shoulder waiting for the AA to come and rescue you...