Redundancy and new car. PCP or not

maisie1234

I will shortly be leaving my company after nearly 35 years and will get just under £100k. I currently get a company car which I do like (no worries about repairs etc). I did have a PCP agreement a couple of years ago which I liked too. I have no interest in keeping an old banger on the road and would like a new car. Thinking of Fiesta or Mini One. Should I get a PCP or offer cash?

I presume that I should apply for a PCP before I leave the company. I am planning to take my pension but won’t have anything like my current earnings (about 40% of current earnings). I have little debt bar £70k on a mortgage and a loan for £3500 which will be paid off in 14 months time. I am also due to come into some inheritance in the next 5 years circa £300-£400k. My husband is still working and we are comfortably off.

I don’t want to defer and defer payments. Like my luxury holidays but can budget if required. I am nearly 60 with two nearly grown up children.

Could anyone advise pleae?

AdrianC

~£100k coming in as redundancy.
~£15k cash for a new or pre-reg Mini.
Pay the loan and mortgage off, leaving ~£10k+ cash, and much lower monthly outgoings from reduced income.

Seems like a no-brainer to me.

marlot

When I left, I had the option of buying my company car at trade price. Is that an option if you're happy with your car?


If you're buying new, check out brokers - I found coast2coast the best, but drivethedeal, carfile etc are with a look. If buying new, manufacturers often contribute if you buy on PCP. I've done that, and then used my right to withdraw from the finance within 14 days. I've always been able to keep the manufacturers contribution.

AdrianC

marlot wrote: »

When I left, I had the option of buying my company car at trade price. Is that an option if you're happy with your car?

Most company cars will be leased, so the employer won't have any right to buy the car - it'll either float around a large employer's fleet until the lease is up and it's returned, or it'll be returned early.

It also won't address the OP's requirements, which are for a zero-hassle car. They're going to need to address maintenance themselves on anything they own, but while a service pack is usually available on a dealer-supplied new or near-new car, it certainly won't be on their ex-cocar.

maisie1234

My car is only 3 months old. The company tend to ask top prices for their cars (and wonder why no one buys them!) but I will be asking for a price. Thank you. I haven’t applied for VR yet. Could be turned down but they have to give to someone otherwise there really isn’t any point offering it in the first place.

maisie1234

On my previous PCP I brought a service pack which I found useful and some dents and scratches insurance which I didn’t! I also brought the Gap insurance but again had no use of it. I guess insurance is a complete waste of time until it isn’t...

maisie1234

Adrian is right as well. My company would rather have a car sitting in their fleet garages as opposed to god forbid giving it to a loyal employee who has looked after it well (me!) and giving them a trade price.

System

maisie1234 wrote: »

Adrian is right as well. My company would rather have a car sitting in their fleet garages as opposed to god forbid giving it to a loyal employee who has looked after it well (me!) and giving them a trade price.

Depreciation and/or payments are a tax write off.

System

AdrianC wrote: »

~£100k coming in as redundancy.
~£15k cash for a new or pre-reg Mini.
Pay the loan and mortgage off, leaving ~£10k+ cash, and much lower monthly outgoings from reduced income.

Seems like a no-brainer to me.

This but take out on PCP to get the discounts offered, pay off in full within 14 days of the agreement starting.

marlot

AdrianC wrote: »

Most company cars will be leased,...

About half my company cars have been company owned, half leased.


If there are redundancies around, it can focus the fleet manager's mind. I got my 9-month old car for half its list price when I left one employer. It was a good 30% less than it would have cost me at a dealer. And because I'd specified the colours and extras, it was exactly what I wanted. Plus I knew its history.

macman

£100K before or after tax? You'll pay tax at your marginal rate on £70K: only the first £30K is tax free.
As above: clear the debt first (mortgage and loan). Why take out a PCP at a higher rate than you'll get on your savings?