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How do lots of people afford the brand new luxury cars ?

361 replies

Stroganoffo · 02/02/2023 15:24

Keep seeing 22 plate Mercedes, Audi , BMW and tesla, when I was little these were quite rare as only the wealthy had them. Now it seems everyone has one considering the average wage isn't that high and the cost of one is 50k. I have a good wage and still don't want to fork out lots. How are people affording them. Is it all on credit ? Aren't people worried with everything else going up and the cost of living crisis ?.

OP posts:
Reugny · 02/02/2023 17:15

@YaWeeFurryBastard one of my friends, who does earn more than average but not enough to afford such an expensive car, gets the same benefit.

NotAgainFrederick · 02/02/2023 17:14

I know young adults in ordinary jobs who have these kind of cars. There parents just have ordinary jobs as well. So I have no idea.

YaWeeFurryBastard · 02/02/2023 17:11

RedToothBrush · 02/02/2023 16:01

DH could get a 'nice car' on his company scheme.

Why, you would, boogles my mind though in terms of the financials. It doesn't even work that well in terms of taxation for him.

He looked at it for three or four years before deciding it was a mugs game, which tied you to a company. Thankfully since he didn't get one, it was easier for him to change jobs when problems started emerging there. He's paid better at his new place.

He was relieved and he's been massively put off the company car handcuffs. Instead we're saving for a new car of his choosing which we will own and not have the spectre of debt having over us (which in theory could affect remortgaging in future too). It's theoretically an asset, which although it depreciates, you still have something tangible rather than just throwing money at thin air. Indeed because the second hand market has been so inflated, the amount his current car has depreciated is a lot less than we factored. Its functional and gets him from a to b.

Every so often he wistfully dreams of having the flash badge with all the gadgets. Then looks at the numbers and goes 'fuck that, I could do x, y and z for that'. It makes no sense except for ego or status.

DH is reinforced by the experience of someone else. A friend of his at his last place is single and bought a fancy car. He's stuck with it, it's woeful fuel efficiency (at one point last year it got to the point he was avoiding going into the office). He loves his car but he'd never get something similar again.

I think you’ve misunderstood here. My DH gets a decent company car fully paid for by the company including settling the tax, if he moves company he’ll just hand back his current car and get a new one as part of the new job package, it’s really quite straight forward! It’s almost always far more beneficial to take the company car than the cash alternative, unless you are talking about a salary sacrifice scheme, which I don’t think the poster you have quoted is.

Baconand · 02/02/2023 17:11

WowIlikereallyhateyou · 02/02/2023 16:53

Really, your comment is absolutely hilarious!

Soooo, you put down an initial on your lease car……..which you loose
You make a monthly payment to cover the depreciation of the lease car……which you loose.
You own nothing at the end of it and start the process all over again.

Mmmm, who is the idiot???

You may need help with maths. It absolutely is cheaper to lease the cars we have-electric. I’m not interested in driving a polluting shit heap. I have standards!

Surelyitscoffeetime · 02/02/2023 17:11

Baconand · 02/02/2023 16:00

Yes but if your used car goes wrong you can lose all the money you put in to it. With a lease it’s not your problem if it’s faulty. I do a lot of miles so a £500 car won’t work. I’d be looking at £10k for something reliable enough.

We only have electric cars and they are very cost effective to lease. No-one wants to own old tech and because they are so cheap to run the lease cost is still cheaper than petrol.

I’ve not got anything luxury right now as took a super cheap VW on lease after mat leave. It’s under £200 a month inc home charging cost and insurance. I couldn’t run an old petrol car for that.

My electric BMW that went before it was just over £300. That was on par with an old petrol car in terms of cost but all the benefits of new car (plus environmental reasons). Win win.

We also have a new MG4, that’s under £200 a month on a PCP. Not luxury by any means but a lovely car. Far cheaper than anything petrol!

Is your VW on lease or PCP? Think I need to look into this!

NImumconfused · 02/02/2023 17:07

I think I may have misunderstood PCP a bit - I thought you made an initial down payment, then your 36/48 months, and the you either handed it back and got nothing back or kept it and paid the remaining lump sum, but people on here have mentioned trade in value? If you don't keep it is it worth something towards your next car?

FieldsOfRoses · 02/02/2023 17:03

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jtaeapa · 02/02/2023 17:00

on the tick as my mother in law used to say

Kangarude · 02/02/2023 17:00

Not £50k but I paid £45k for my car. Paid for it by selling my previous car for £20k and the rest I paid in cash. I work, no mortgage or young children and have savings. It obviously isn't for everyone, but suits me.

BodyShapeWoes · 02/02/2023 16:59

One company car, one which was a pcp and now being paid off via hp (last few payments this year) and one car is 15 year old runaround

Works for us

household income of just under 100k but we had the pcp before I changed jobs it’s always been around £300 a month

WowIlikereallyhateyou · 02/02/2023 16:58

MissConductUS · 02/02/2023 16:21

We pay cash when we buy new cars, then drive them until the wheels fall off. I guess we're financial idiots.

Disadvantages to Leasing As attractive as a lease may appear, there are a number of disadvantages:

• In the end, leasing usually costs you more than an equivalent loan because you’re paying for the car during the time when it is most rapidly depreciating.

• If you lease one car after another, monthly payments go on forever. By contrast, the longer you keep a vehicle after the loan is paid off, the more value you get out of it. Over the long term, the cheapest way to drive is to buy a car and keep it until it’s uneconomical to repair.

• Lease contracts specify a limited number of miles. If you go over that limit, you’ll have to pay an excess mileage penalty. That can range from 10 cents to as much as 50 cents for every additional mile. So be sure to calculate how much you plan to drive. You don’t get a credit for unused miles.

MissConductUS,
my other half specialises in this area and advising large lenders in automotive, he eould never lease a car, and you are absolutely correct the most financially savvy way to put a vehicle on the road is to buy it, look after it and drive the wheels off it.
You are far from an idiot!

QuertyGirl · 02/02/2023 16:56

Comedycook · 02/02/2023 16:50

Cars used to be a barometer of wealth. Not any more.

No, just willingness to consume regardless

Blossomtoes · 02/02/2023 16:54

Stroganoffo · 02/02/2023 16:41

I balk at spending £500 on a car per month, I'm in a high income household. Aren't people worried about denting it ? Scratching the alloys ? I bought a one year old car outright it's nearly 7 years old now. I've looked at the lease deals but I'd be worried about having to keep it pristine and the sums are eye watering. I think I'll wait until this one packs in and do the same again.

If you’re trading it in for a new one they don’t even look at small defects that a few hours in the workshop can solve. It definitely doesn’t have to be pristine. Our new car is going to cost us £240 a month, it’s hardly eye watering.

AngelsWithSilverWings · 02/02/2023 16:54

@Stroganoffo we paid £330 per month for a four year lease on our E class Mercedes. This was an absolute bargain. Yes the alloys are a nightmare. We never had that worry when we leased a Nissan. We have just paid £400 to get them all fixed just to hand the car back and avoid a penalty. The car went back yesterday and we are waiting on the verdict regarding any damage penalties due.

It was the best and most luxurious car I've ever driven so I don't regret the expense.

WowIlikereallyhateyou · 02/02/2023 16:53

Baconand · 02/02/2023 15:40

We lease. We get some absolute bargains.
Only a financial idiot would buy a depreciating asset like a new car outright.

Really, your comment is absolutely hilarious!

Soooo, you put down an initial on your lease car……..which you loose
You make a monthly payment to cover the depreciation of the lease car……which you loose.
You own nothing at the end of it and start the process all over again.

Mmmm, who is the idiot???

Comedycook · 02/02/2023 16:50

Cars used to be a barometer of wealth. Not any more.

AngelsWithSilverWings · 02/02/2023 16:48

I'm our case leasing. It's not so easy to get a deal now but when we got a brand new E class Mercedes in 2019 we had actually been all set to order our third leased Nissan. When we went to complete the order a "hot deal" popped up for the E class which was cheaper per month than the Nissan.

The lease is up on the Mercedes now and we've ordered a CLA class but it's very much a downgrade even though it's more expensive ( and it's been 6 months since we ordered it and still no sign of it even being built let alone delivered!)

Cactuslover88 · 02/02/2023 16:47

I’m paying £175 a month for 3 years to effectively lease (PCP) a brand new Audi, on a £100k a year household salary that’s perfectly affordable… If you want to own the car at the end that’s different. I was fed up of driving an older car that constantly needed repairing where I’d worry about it needing work done constantly. Like others have said, I don’t see the issue renting a depreciating asset.

x2boys · 02/02/2023 16:45

rothbury · 02/02/2023 15:53

Sorry, should have elaborated. I don't think people with DC with SEN cannot have nice things, but one of these children will never be able to live independently. I would have put money aside for my DC care rather than spend it on a luxury brand car, as would most parents I believe.

Depending on the rate of DLA,the child gets ,they might be able to get a mobility car?the child would have to be in receipt.of the High rate mobility component.

Stroganoffo · 02/02/2023 16:41

I balk at spending £500 on a car per month, I'm in a high income household. Aren't people worried about denting it ? Scratching the alloys ? I bought a one year old car outright it's nearly 7 years old now. I've looked at the lease deals but I'd be worried about having to keep it pristine and the sums are eye watering. I think I'll wait until this one packs in and do the same again.

OP posts:
MissConductUS · 02/02/2023 16:41

I'd rather still be paying and sitting in a car with all the bells and whistles, than in a 16 year old, falling apart, money pit mondeo like my brother.

When the car costs more to repair than it's worth, we trade it in or donate it and buy a new one. My daughter has our 2012 Subaru at uni and it's fine. It's never needed a major repair, just the scheduled maintenance and things you'd expect to replace like tires and brake parts.

SweetSakura · 02/02/2023 16:40

They have more money. Or they like spending the money they have on cars.

DH and I have two basic runabouts but both have high paid jobs, we've prioritised a big house,.decent pensions, lots of activities and holidays with the kids. I have friends with big new SUVs constantly sighing about things they can't afford.... Different priorities.

(I also know people whose parents buy them a fancy new car every few years - some people just have a lot of money from sources other than employment)

RudsyFarmer · 02/02/2023 16:39

The reason we buy, not lease is because DP does all the maintenance on them. We can put as much mileage on. The kids are pretty bloody messy and I’m not freaking out and I guess we can afford to buy. Then we part exchange and but again. Oh and I don’t give a shit about what I drive as long as it’s reliable, so I guess I’m low maintenance in that regard.

x2boys · 02/02/2023 16:38

We got a brand new mobility car as my sons disabled it's not a top.of the range model though ,it s paid for out of the mobility component of my sons DLA.

Applesandcarrots · 02/02/2023 16:37

when I was little these were quite rare as only the wealthy had them.

When my mum was little same apllied to jeans and bananas....
Times change

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