How do I go about buying a new car??

Rusty_bongo

Hi,

My car has just been condemned by the garage so we need to buy a new one. We manage on one car as a family of 4, and I'm looking at SUVs to make camping/cycling a bit easier.

We are in a pretty fortunate position financially. Although we dont earn huge amounts (£20k each), we have no mortgage and no debts. I also have £30k in the bank (some invested in shares, some premium bonds etc). My husband has no savings.

So, do I pay outright fo a car? I think I could get a reasonable 4 year old Qashqai or similar for around £10k. We would both then pay £75 a month into a savings so that would recoup £9k in 5 years time

..or do I put a £5k deposit on a £17k one year old Skoda Karoq and go down the PCP route? This would cos us around £80 each a month for 4 years.

Any help or advice would be much appreciated listed as I really cannot work this out!!!

ratrace

Rusty_bongo wrote: »

Hi,

My car has just been condemned by the garage so we need to buy a new one. We manage on one car as a family of 4, and I'm looking at SUVs to make camping/cycling a bit easier.

We are in a pretty fortunate position financially. Although we dont earn huge amounts (£20k each), we have no mortgage and no debts. I also have £30k in the bank (some invested in shares, some premium bonds etc). My husband has no savings.

So, do I pay outright fo a car? I think I could get a reasonable 4 year old Qashqai or similar for around £10k. We would both then pay £75 a month into a savings so that would recoup £9k in 5 years time

..or do I put a £5k deposit on a £17k one year old Skoda Karoq and go down the PCP route? This would cos us around £80 each a month for 4 years.

Any help or advice would be much appreciated listed as I really cannot work this out!!!

I would not buy a car on pcp especially if i had cash to buy a car outright and i also would not spend £17k on a skoda that will depreciate a fair ammount

If i was in your position i would just buy a car outright for £10k not only will you be saving a lot in intrest that you would have paid for on a pcp but also have the peace of mind of owning your car instead of renting it, and the money you would pay on pcp just repay intoyour savings every month, you sound very smart and money savvy hence you have built up 30k in savings dont let needing a new car throw you of course, your futre self will thank you for it, we dont need expensive cars just for them to be parked up in the works car park for 8 hrs a day, you have done well dont stop and reverse what you have achieved

the nissan sounds like a good shout but for 10k there are lots of suv's out there. dont rush take your time and make a wise decision and a money saving one


Ps: its nice to seen someone with good financial sense, and not giving in to what society/trends want you to spend your money on, Good on you

Cisco001

I don't know much about car, but I saw this deal

https://www.hotukdeals.com/deals/pre-reg-69-plate-mg-zs-15-vti-tech-excite-11236-at-richmond-motor-group-3313183

Rusty_bongo

Aw, thanks Ratrace - I often get accused of being tight, but am proud of being debt-free. My friends all drive nice cars and have big shiny houses, but it's all on the knock. Makes me anxious just thinking about it!

Yes, I think we'll set a budget of £10k and pay ourselves the money back each month.

Thanks for the nudge!

ratrace

Rusty_bongo wrote: »

Aw, thanks Ratrace - I often get accused of being tight, but am proud of being debt-free. My friends all drive nice cars and have big shiny houses, but it's all on the knock. Makes me anxious just thinking about it!

Yes, I think we'll set a budget of £10k and pay ourselves the money back each month.

Thanks for the nudge!

Your very welcome, there is nothing wrong with being financially savvy as long as you dont take it to the extreme lol, Your friends and family deep down really envy you, why simply because you are a strong person and dont give in to what most people in this day and age see as "normal" and debt unfortunately is very normal, you only just have to the debt free wanna boards on here to give you an insight of the problem. (dont mean to turn this into a philosophy class lol)

Yes 10k is a very reasonable budget and there are lots of cars out there buy somthing with average miles with full service history and you should be good for a few years, keep repaying your saving and in a few years not only will you have all your money back you will also have a car to show for it instead of the other way round with a pcp

all the best if you need advice any cars you have seen just me pm and ill take a look at them for you (I work on cars) stay debt free!:money:

Goudy

I would recommend you work out the figures carefully on a PCP for a used car.
They tend to work out quite an expensive way to buy compared to a PCP on a new one as you often pay a higher interest rate and don't qualify for a manufacturers deposit contribution.

But the best way is the one that costs you less overall, if you're going to buy a £17000 car, make sure it doesn't cost you £22000 in the end. (£17000 would be ideal, less even better!)

If your savings are making next to nothing in interest, it's probably wise to use that than take on finance at a higher rate or if you can find a loan rate cheaper than what your savings are making, use that.

You could hedge your bets and buy new on PCP with a manufacturers deposit contribution.
You could be looking at a £20,000 for just £17,000 which you then use your savings to settle after you take delivery.

Basically you sign up the the new car on PCP and qualify for a nice deposit contribution, then phone up the finance company and pay the settlement figure after you take delivery (so no interest). So now you have a £20,000 car that cost you £17,000.

Sometimes you can increase the deposit contribution through various schemes.
These often depend on where you work, like the Police, Miltary, NHS or teacher, but I've seen deals for M&S and BT staff as well as Aston Villa season ticket holders.

Robisere

Might this help? I agree with spending only £10.000: -

https://www.whatcar.com/news/top-10-used-suvs-for-less-than-pound10000/n14708

10 cars that should strike a chord with you amongst them.

marlot

Rusty_bongo wrote: »

...
So, do I pay outright fo a car? I think I could get a reasonable 4 year old Qashqai or similar for around £10k. We would both then pay £75 a month into a savings so that would recoup £9k in 5 years time

..or do I put a £5k deposit on a £17k one year old Skoda Karoq and go down the PCP route? This would cos us around £80 each a month for 4 years....

I hate the word 'deposit' in relation to the initial payment on PCP. It isn't a deposit - you don't get it back.

So at the end of the four years, you need to find another 5k for the next car. ie. in addition to paying the £80 a month, you also need to save about £100 a month for the next car.

Mutton_Geoff

I needed something to use as a van and chose a Honda CRV based on it’s reliability record. An older BMW or Audi might be tempting but your running costs will be higher. I just had a major service done at a Honda dealer inc brake fluid change, collection and delivery to my home and a full showroon standard valet for less than £300.

Had the car a year and chose petrol 4WD version. The 4WD is part time so kicks in when needed. I put a set of Michelin cross climates on it when I first got it and it seems to cope with everything.

Plenty around sub £10k.

knightstyle

Do not write off your existing car, look for best part exchange, £2k is on the sign outside a Ford garage at the moment. Plus a lot of garages are stuck with diesels so if your driving pattern is OK for them you can get a good deal on one.

NBLondon

Goudy wrote: »

If your savings are making next to nothing in interest, it's probably wise to use that than take on finance at a higher rate

Definitley

or if you can find a loan rate cheaper than what your savings are making, use that.

Ideally. I managed to do that in 2011 when Ford offered a 0% finance deal if you put down 50% up front. So I paid the 50%, left the rest in an ISA then paid off 1 day before the massive interest kicked in. Not sure that sort of deal is around now though...