How much to spend on a used car

andypa1

Hi all,

I currently drive a 2006 Honda Civic, it cost me £3500 3 years ago and it's been brilliant, super reliable, efficient etc.

It's now looking a bit tatty and having looked around I'm likely to get about £2k to £2500 for it, not bad for depreciation I reckon seeing that i've added 30k to the clock

Looking for a new used car I'm just wondering what is a reasonable price to pay in terms of percentage of my income? I'm aware that some people pay lots of money every month on a hire purchase but I'm not interested in doing that.

I'm currently taking home £2k a month after tax and mortage is very affordable, i'm very careful with money and live well within my means.

The Jaguar XF looks great and I can get a decent 2009 / 2010 for £10k with savings / selling my current car. It's the most i've ever spent on a car so while I know that Martin would say just dump my savings into overpaying the mortage instead actually I'd really enjoy driving it.

Am I being wreckless spending nearly a third of my annual salary on a car? It will probably last me at least 3 years so I guess it's more like a tenth of my annual salary plus I'll be getting something for it when I sell it.

Would really appreciate any advice you might have for me about how much you all spend on a used car as a percentage of income.

andypa1

I should probably also mention that I don't have any debt to my name.

BeenThroughItAll

I change my car whenever I feel like it, which is often every six months or so, and I've had a variety of 'nice' cars; BMWs, Audis, Jeeps, Volvos, Skodas, MX5s, Saabs, etc in the last five years or so. My criteria are simple - must have full leather, must have working climate control, must have cruise control, must have an auto box. The MX5s are the only exceptions I've made to two of those. I never spend more than about 4% of my salary on outright purchase, and every one of the cars I buy could last me at least 3 years if I didn't get bored, so you don't need to spend much at all.

loskie

andypa1 wrote: »

I should probably also mention that I don't have any debt to my name.

apart from a mortgage

andypa1

sorry if this is rude to ask, but how much are you typically paying for these 'nice' cars?
I'm not sure if you're working that out as the cost of the car spread over 3 years is 4% or not?

gilbert_and_sullivan

This possibly isn't what you want to hear, but you are in a very fortunate position, decent income, manageable mortgage and the icing on the cake no debts, well done, and no that isn't sarcasm i mean it.

My advice for what its worth is to spend a few quid on the current car, maybe get a little one man and his dog bodyshop to fettle the paint back to shape, give it a one hell of a service and maintain it well for the rest of its time, and keep it.

Then you throw any spare money you have at the mortgage, interest rates have really never been lower, pay that mortgage off asap, and breath easy when interest rates eventually have to rise in order to stabilise the economy, which has been going round the U bend for many years...others who seem to have forgotten history are buying new cars on PCP deals like they're going to be banned or something, there will be much wailing and weeping to be heard in due course as people who borrowed on depreciating assets lose their homes, we've been there before and people never learn, you can be breathing easy and buy whatever cars you want.

Trust me, the day you pay that mortgage off is probably the most liberating day in your life.

Our last two cars cost £1170 and £3500, both worth near enough the same now some 2.5 years and 1.8 years later respectively, combined purchase price was about 10% of my annual salary, so no cost at all this year for car purchases and hopefully they'll both last another 3 to 5 years each.
As you, no debts, don't want any.

An XF has the ability to provide you with some eye watering bills.

BeenThroughItAll

andypa1 wrote: »

sorry if this is rude to ask, but how much are you typically paying for these 'nice' cars?
I'm not sure if you're working that out as the cost of the car spread over 3 years is 4% or not?

No, it's around 4% of my annual salary over 1 year. I normally pay somewhere between 2K and 2.5K.