PCP optimisation

mp80

Hi

I'm looking at one of the DriveTheDeal Audi Q5s - this is an S Line 2.0 190PS with Pano, Tech, Comfort pack. The saving on list is getting on for £10,000.

The GMFV I've been quoted is £21.5k on c. £430 / month PCP deal with 4k deposit in on 48k miles - which is by a long way the cheapest I've come across including lease comparisons through quite a lot of brokers.

Now we've paid c. 400-420 a month for car finance for about 8 years now, so it's now a normal operating cost for us.

My question, given the high MGFV which is obviously priced to sell and not for equity - I will definitely not keep the car, therefore does it make more financial sense to

a) Pay a bigger deposit

still pay 4k deposit, and lump sum the 'rental' part of the PCP in one go after the first payment to get it down to 50 quid a month without affecting the capital balloon (i was told you can do that?) - I'm aware I will still be charged interest on the balloon, however I will have avoided 4 years worth of interest accrual on payments I'm contractually obliged to make, will have significantly reduced payments and also be closer to the VT point in case of financial catastrophe down the line.

All advice welcome, except the usual advice I should have bought an 8 year old wreck for £1500. I don't want to own the car, I want something nice and it's within means. I'm trying to optimise the deal as best as I can.

M

neilmcl

Could you not do better leasing? PCP isn't really designed for buyers who have no interest in a final purchase.

geeovana

mp80 wrote: »

Hi

Now we've paid c. 400-420 a month for car finance for about 8 years now, so it's now a normal operating cost for us.

M

That's £40K plus anymore you have put down with deposits.


If you had saved and invested that monthly amount you would have well over £50K now.


Food for thought.

mp80

The cheapest lease I!!!8217;ve found was about 100 per month more expensive. Like for like

mp80

I could have done many things with the benefit of hindsight, I could have had a heart attack three years ago, I could have lost hundreds of thousands on the stock market crash, I could have won the lottery

haven’t done any of these things and I have a specific question, so how is your comment relevant or helpful to the here and now ?

geeovana

mp80 wrote: »

I could have done many things with the benefit of hindsight, I could have had a heart attack three years ago, I could have lost hundreds of thousands on the stock market crash, I could have won the lottery

haven’t done any of these things and I have a specific question, so how is your comment relevant or helpful to the here and now ?

I was simply stating the 'Moneysaving' facts.


You couldn't have lost hundreds of thousands on the stock market crash with the money you have spent on the car could you? The 'crash' was 2007 - 2008 and you stated you have been spending on car finance for the last 8 years. That put's the start date at 2010 by my calculations. The S&P 500 has risen over 140% since then excluding dividends, so you would in fact have a lot more than £50K if you have put the money into a global index tracker. The above £50K+ was assuming 7% growth / year, (standard market return).


I agree with your comment regarding the heart attack and balance is very important. However, stating you could have won the lottery so you need not save for the future is slightly worrying. Is that your pension plan for the future?


I was simply trying to point out how much money you have spent on car finance in the past 8 years. I meant no offence, honestly. I myself think car finance is a colossal waste of money, however who's to say I am right. I have no idea of your financial situation. £50K + may be a drop in the ocean to yourself. I was simply stating some facts I thought may interest you, as you consider your next finance agreement.

Mercdriver

geeovana wrote: »

That's £40K plus anymore you have put down with deposits.


If you had saved and invested that monthly amount you would have well over £50K now.


Food for thought.

While that is true, the OP would have had no car in the meantime.

geeovana

Mercdriver wrote: »

While that is true, the OP would have had no car in the meantime.

Clearly, I was making a point. Let's get the thread back on track so the OP can get the answer he was after in the first place.


He clearly doesn't want advice on anything other than what he believes is right.


He appears really mature liking your post.

motorguy

geeovana wrote: »

Clearly i was making a point.

Yes. You were.

geeovana wrote: »

He clearly doesn't want advice on anything other than what he believes is right.

Exactly.

What suits your beliefs / financial constraints does not suit others.

He asked for advice on the deal, not on how he choses to spend his money.

motorguy

mp80 wrote: »

Hi

I'm looking at one of the DriveTheDeal Audi Q5s - this is an S Line 2.0 190PS with Pano, Tech, Comfort pack. The saving on list is getting on for £10,000.

The GMFV I've been quoted is £21.5k on c. £430 / month PCP deal with 4k deposit in on 48k miles - which is by a long way the cheapest I've come across including lease comparisons through quite a lot of brokers.

Now we've paid c. 400-420 a month for car finance for about 8 years now, so it's now a normal operating cost for us.

My question, given the high MGFV which is obviously priced to sell and not for equity - I will definitely not keep the car, therefore does it make more financial sense to

a) Pay a bigger deposit

still pay 4k deposit, and lump sum the 'rental' part of the PCP in one go after the first payment to get it down to 50 quid a month without affecting the capital balloon (i was told you can do that?) - I'm aware I will still be charged interest on the balloon, however I will have avoided 4 years worth of interest accrual on payments I'm contractually obliged to make, will have significantly reduced payments and also be closer to the VT point in case of financial catastrophe down the line.

All advice welcome, except the usual advice I should have bought an 8 year old wreck for £1500. I don't want to own the car, I want something nice and it's within means. I'm trying to optimise the deal as best as I can.

M

If you have no intentions of keeping the car, i'd either leave it as is or reduce the deposit and treating it wholly as a rental, which it is.

Your ammortised monthly cost is £513, so you're getting a slight false positive with the heavy ish deposit.

Mercdriver

geeovana wrote: »

Clearly, I was making a point. Let's get the thread back on track so the OP can get the answer he was after in the first place.


He clearly doesn't want advice on anything other than what he believes is right.


He appears really mature liking your post.

You might say he is not being very MSE, but he isn't asking how he can best save money overall. He is asking for the most efficient way of doing what he wants to do. You might suggest that he should get a 3 year old Dacia Duster and put the remainder of the money in the bank. But he knows what it is he wants, and is looking for the most efficient way of getting what he wants.