Don't buy a new car out of uni...

rev_henry

gadgetmind wrote: »

Current A8 was bought with above average miles but sat nav showed loads of destinations in Denmark and Germany, so that's fine,

It also had ESP and ABS faults showing on the dash, for which I got £750 wiped off an already good price. As I'd pulled the fault codes, I knew that all it needed was an £8.20 brake pedal switch.

Knowledge is power.

This is the way forward! I'm hoping to buy something similar when I graduate in a few months. Maybe an old 5 series.

kidmugsy

rev_henry wrote: »

This is the way forward! I'm hoping to buy something similar when I graduate in a few months. Maybe an old 5 series.

Good to see that the crushing burden of student debt won't inhibit the young from stimulating the consumer economy.

atush

gadgetmind wrote: »

My FIL buys a brand new Peugeot "1234" every three years gets "a good deal" because they knock a wodge off the list price, then chops it again three years later.

He occasionally makes a comment about my "flash cars", as does my father who drives Mondeos, but I know for sure that my depreciation and running costs are a fraction of theirs.

I probably bought one of his old ones for my boys lol

karlie88

lalman wrote: »

I wish i was given that advice (dont buy a new car out of uni) when i finished uni 6 years ago.

I was lucky enough to land a 17k job about 5 months after i finished uni... which is pretty decent up north... as i was living with my folks i saved for a year and decided in my 'wisdom..' buying on PCP a 20k audi was a good deal... I paid 242 pounds a month (around 20% of my salary at the time) and when the PCP finished 3 years later i was still on a similar salary as the financial crisis hit... anyway long story cut short... i decided not to get a new car and instead buy my existing car as i had only done 18 thousand miles in it... 2 years further on and its today.. and the 8200 i owed on the car i loaned and just paid 3500 early (saving 116 pounds interest).

I wish i had saved that money and bought a second hand car instead - yes my audi is still in good working order but it was really a stupid decision.

The lesson i have learnt is i will always buy 1-2 year old cars... and keep them until they are uneconomical....

anyone else got any sage advice from unfrugal youths?

Depends on your finances.

I graduated in July 2012 and went straight into a job earning 29k.

I already had a lot of savings and have always loved cars (I am a big motorsport fan) and so, I bought a new car with a RRP of £24k for £19k. So far, I have not regretted that decision (I have owned the car for 15 months now). I paid the car in full; no finance.

I was fully aware of the depreciation values, insurance costs, fuel costs etc. The car still puts a smile on my face.

My plan is to keep it as my main car for another 2 years or so and then I'll use it as a track day car every month or so.

I wouldn't call myself an 'unfrugal' youth.

The_Earl_of_Streatham

The point of being young (if there is one) is that you've got plenty of time to dig yourself out of any mess you find yourself in. Assumed in this analysis is your ability to spot a mistake and not repeat it, you would appear have done that. You are also seem happy to advertise it here to see if you can learn even more from it. You'll probably be all right.

On the issue of credit generally, I've had loads in the past and always paid it off, though on one occasion it did get as far as the warning letters. It's there to use, take it or leave it but understand the risks.

As to the business of using credit only to buy a house, I am perplexed. The only time to use credit is to buy the thing which it would be most disastrous to lose? Not a decision arrived at from a rational investigation of credit but one that arises out of sheer necessity.

Freecall

Shurely the real MSE issue here is not the car itself, if you can afford a brand new Bentley and that is what you want then that is up to the individual.

The real financial scandal is the PCP's which are sold to people who don't really understand what they can do to your long term wealth.

jimjames

kidmugsy wrote: »

Good to see that the crushing burden of student debt won't inhibit the young from stimulating the consumer economy.

An old 5 series at £1000 won't do much to stimulate the economy!

mark88man wrote: »

4.5 years later its at 230K miles and apart from being a bit sluggish up hill has averaged a total of £1k a year for tax, insurance and servicing - not bad as most mileage is expensed and I have a car allowance well north of that

I do get comments on my PoS (Piece of !!!!!!) Audi - but I don't really care

Comments (PoS) like that are great when you know that you're the one saving a fortune with that car. 10 years ago I had an A4 I bought with 138k on it, fantastic car and no real issues other than servicing in 40k miles done in it. I always tend to get cars that are over 100k miles now.

mark55man

Well Jim I'm with you on that on


I have a bit of a punt on BKIR (Bank of Ireland ordinaries) in my risky S&S pot - these already have good safety margin on them so am going to leave them for a few months - post reporting. if they rocket I may take some profits and accelerate procurement of my replacement car and even go as new as an 08 plate - mainly as that's what my daughter just got when she passed her test a few months ago. gadgetmind's A8 is possibly a bit rich for me but I may explore

F1F93

lalman wrote: »

I wish i was given that advice (dont buy a new car out of uni) when i finished uni 6 years ago.

I was lucky enough to land a 17k job about 5 months after i finished uni... which is pretty decent up north... as i was living with my folks i saved for a year and decided in my 'wisdom..' buying on PCP a 20k audi was a good deal... I paid 242 pounds a month (around 20% of my salary at the time) and when the PCP finished 3 years later i was still on a similar salary as the financial crisis hit... anyway long story cut short... i decided not to get a new car and instead buy my existing car as i had only done 18 thousand miles in it... 2 years further on and its today.. and the 8200 i owed on the car i loaned and just paid 3500 early (saving 116 pounds interest).

I wish i had saved that money and bought a second hand car instead - yes my audi is still in good working order but it was really a stupid decision.

The lesson i have learnt is i will always buy 1-2 year old cars... and keep them until they are uneconomical....

anyone else got any sage advice from unfrugal youths?

I'm afraid I disagree with this...
Not all new car deals are bad! And in fact, often they are cheaper than old cars.
My current car (an 06 Ford Focus 1.6TDCi Ghia) is costing me about this much to keep on the road, including depreciation, servicing, MOT, and repairs (I have assumed that over the next few years it will cost me as much to repair as it has done so far and will not become unreliable). Plus a newer car will be generally be cheaper to insure, more economical, possibly faster, and will have more gadgets depending on the model.

The whole point of PCP is to get a new car every three years. Did you even consider part ex-ing your Audi against a new one? Given the price of three year old audi's that cost 20K new you may well have got as much as 11K as trade in. That's £3000 as a deposit on your next one. If your deposit previously was about this much, then you could have got a brand new Audi for the same monthly payments as you were paying now, and got the security of a warranty too.

Also, did you do much research into the different cars of that class before wading in and buying? I'm presuming for £20K you would have got an A3? Or possibly a base spec A4? If you got the A3, did you consider the Ford Focus? Vauxhall Astra? Skoda Octavia? Seat Leon? VW Golf? etc. There are easily a dozen different cars in that sector. I'm sure one of them will have done you a good deal in regards to interest. I'm not sure if they're still doing it, but Skoda were offering 0% interest and free servicing for 3 years. Seat were offering over £1000 worth of extras including a DAB radio and Xenon's. And so on.

Then we get on to brokers. There are many different websites such as orangewheels, drivethedeal etc which will find the best deal on a particular car, then put you in touch with the dealer offering this. Using this deal (and WhatCar's Target Price) you can haggle with your local dealer and see if they will beat this. You shouldn't EVER pay list price for a new car.

Also, did you ever consider ex-demo cars? These will often have as little as a thousand miles on the clock, are often loaded with options to show off the tech and are massively reduced (I've seen a £20K car reduced to £14K). Effectively a brand new car.





I understand what you're saying, and it's very easy to get stung like you have. But what I'm trying to say is that if you're rigorous enough, you should be able to get a good deal on a new car. And it might be cheaper than you think!

HHarry

I have to say that I'd disagree (a little) as well. It's very sensible to always make the 'safe' financial decision, but at some point you're going to want to enjoy or treat yourself and to do that you're going to have to spend a bit. I'm sure that paying off your mortgage at 45 or 50 is a great feeling, but have some fun in the middle as well.

I did the same as the OP. Promoted at 21, went and bought a new MGF on PCP. Only I handed it back after 2 years, having paid £10k for the priviledge. Managed to lose a smiliar amount on another car a few years later, only this time I had bought it at 3 years old (so it doesn't always work out!) Yet I don't regert either incident because I got a lot of pleasure from both cars.
Next week some friends and I have rented a helicopter for the day to take us snowboarding. I could have paid something off the mortgage instead, but if I waited until I was mortgage free, my body would have long given up!

Be sensible, make the decision for the right reasons, and don't regret it!