Do you buy your cars outright or on finance/lease?

[Daddypigsglasses]

I’ve always saved up and brought a nearly new car then run it into the ground. It was instilled into me as a child that borrowing money was bad and this is the way my parents always did it.

I need to replace my car soon and it’s become blindingly obvious to me since my kids started school last year and I began noticing the other parent’s cars that we are the only ones (and I mean only ones) driving around in anything like a 12 year old focus.

Do most other people else get cars on finance? Is it the sensible thing to do? I can’t get my head around it. I’ve got around 8k to spend so likely that would get me a 15 plate decent car, which is still going to be older than everyone else’s!

I’m not usually showy but I seem to have serious envy where the other parents are concerned.

Like many PP, I've always bought outright 2nd hand and kept them going as long as possible. However I'm not sure I'm going to keep doing this. Current car is an 8 yo Peugeot that cost £4k which I've had for 2 years. Took a bank loan for it which means I'm paying what a lease might cost per month anyway, and on top of that I've had a stinking repair bill every year of between £600 and £1000 (diesel injectors etc) Just gearing up for this years incident as I think the suspension has gone with the last pothole. This doesn't include normal servicing, tyres and small repairs. The upshot is that I'm feeling trapped as I never get far enough past the last big cost to feel like I've recovered value out of the car, and it's getting pretty unreliable. Think I'll lease next time.

Peugeots are generally shit cars to be fair.
I think it's weird that some people seem to be assuming that new is better and more reliable than used. It's not necessarily the case. It all depends on what car you buy, you have to choose carefully.

I had an ancient Ford Focus that was ridiculously reliable. I was planning to drive it until it died but it just wouldn't die! Cost a lot less in maintenance than a lot of much newer cars, I'm sure.

But with new you get a warranty for a minimum of three years so no repair or MOT costs.

With older cars, but not so old that you can scrap them if you get a big bill, you hoping that you don't get bills like OneMore had, and her car has probably cost as much if not more than a new car.

Warranty doesn't cover loads of stuff as my brother has just found out with his Tiguan.

Peugeots are generally shit cars to be fair.

Not my experience. My first Peugeot was a 309 bought new in 1991 which racked up 200,000 miles over 9 years with pretty minimal repairs - mostly just consumables such as brake discs, tyres etc. It did breakdown once along the way but can't remember what it was - from memory easily fixed in the garage for a few hundred.

I replaced it with a new 306 in 2000 which did about the same - I kept it to around 2010 - I wasn't driving quite so much due to a job change, but it still got to about 150,000 miles or so, again, just the normal repairs/consumables, although that one needed a new section of exhaust.

All in all they were damn good workhorses. I'd have had another but when I looked at options in 2010, there wasn't anything in the range I liked - I'm pretty large so needed a spacious interior, but the similar sized cars (to the 309 and 306) were very tight inside with door pockets and central consoles. I opted for a Renault instead which performed just as well.

I wonder if the earlier poster was talking about the smaller Peugeots, i.e. the 10x and 20x ranges which do appear pretty cheap and nasty!

We did a bank loan and backed ourselves. We didn't need a bank loan, but just to keep money in our accounts we did. We'll
Likely pay it off way ahead of time.
Disagree with financing, don't buy it if you can't afford it. But I realise that is considered old fashioned thinking.
PCP will definitely be the next financial scandal.

So you have 8k

You could get a personal unsecured loan at 2.9% for the rest

Your repayments on a 20k car would be roughly 250 pm

Go to a dealership get a 6 month old car probably driven by the staff etc
Bargain!! Just test drive it lots of them and strike up a deal

Say the car is listed as 21k

Ask for their best price

They won't go for it

Say: fine I want a 3 year service package, 6 months tax, floor matts etc etc

Or 3k off

If they say no walk away try another

It works every time I've bought some amazing cars doing this

Golf tdi 6 months old 12k on the clock 11k

Finance. We like nice cars and change every 3 years one is through Dhs business and we pay for the other one.

Some of these justifications are getting ridiculous now "we like nice cars"... as if it's not possible to buy a "nice car" outright?! I think "nice car" is a euphemism for "expensive car I can't actually afford"

People don't need to justify how they spend their own money

But that's what this whole thread is!

Always buy outright from savings

No - originally it was what do you do and why, not 'defend yourself against randomers'

"Defend yourself against randomers" is a major theme of mumsnet

Hahaha very true!!!

Outright.

I’d rather own my car than have nothing to show for my money at the end of the lease period. I have a very nice one too

I lease them. I'm a bit of a petrolhead and CBA'd with most of the faff that goes along with car buying. I also get bored of cars and so prefer to change out every few years.

For some people, finance is a choice, but for others it’s not a choice because they don’t have the cash up front to buy outright.

If it’s a choice, fair enough. I calculate the true ‘cost’ or benefit of different options by seeing the alternatives I can have or go without. So spending £6k 11 years ago has meant I’ve not paid the monthly finance bills but about £400 on average per year for servicing and minor replacements. The fact I’ve done that for 30 years has probably meant I’ve paid off my mortgage a couple of years sooner. That has probably helped me find independent education and will help me retire at 58.

It’s just choices isn’t it - consume today or consume tomorrow. Have the things you fancy today and pay more and longer or accept something lesser today and have more tomorrow. There’s no right choice as long as you understand the consequences of your choice.

Lots of people live in fear of unexpected bills - for their car, or their pet needing medical treatment or their boiler breaking down - it’s because so many people don’t have even a couple of grand behind them - life is very hand to mouth. So you can have boiler insurance or pet insurance or a lease car or various other monthly payments to avoid bigger surprise bills. But you typically pay more for those things. Those with more cash feel less anxious and more able to take the risk and just fork out if a big cost appears - and they generally spend less through this approach. Having £10k in the bank gives peace of mind which allows you to choose the cheaper option and grow your £10k even more. Paying by instalments probably makes it harder to ever grow decent savings because you’re paying more and longer. It can be a trap, in the same way people have found some of the schemes like Help to Buy helped on one hand and allowed a purchase that wouldn’t have been possible, but are also traps in their own way, unless handled very carefully and with a medium term plan to escape them.

Someone I work with does his cars (2) and motorbike on pc. They have a good income and he likes to change every couple of years. He will say that spending 30k on Audi is madness but 300pm let's you drive it without breaking the bank. He got his 19 yr old a Toyota Corolla prob 8yrs old for 1500 so knows what to spend money on. The idea of owning the car is good but your equity is going down all the time through depreciation. For some people their car is their status and others it just needs to be reliable. However a money pit of a car is not good. Diesels are not a great buy now and in the next few yrs more cities are going to close off the centre's to through traffic. I went pcp as the finance was as much money and at the end I would still have an older car that may have started to fail. When they start costing big money for repairs and/or become unreliable they have to go.

Wombat puts it very succinctly. The nub is if you are poor you are screwed. Those with money or have cars provided have more options

Wombat that all makes sense.

In general though I think some people are greedy and think they "need" a £20k car when no one does.

(Actual poor people don't have cars at all, btw!)

We buy outright, usually nearly new (don't see the point buying completely new), so 6 months or a year old. Then keep it until we outgrow it/enviro rules change/it starts becoming expensive to fix. Last car was about 18k I think and still going strong 6 years later.

We've had 2 medium-large Peugeots, covering about 14 years in total and they've never been in the garage or broken down!

We could easily afford to have something new and snazzy but we're really just not that bothered about cars. If it's very safe and big enough, fairly eco, then we're happy. DH also gets a good car allowance but as we don't keep buying new cars then we can just invest that money instead.

Be extremely cautious of PCP deals, I currently have one as does my mum. Unfortunately (won’t go into too much detail) but we have had an awful and painful battle to return my mums car, due to unforeseen circumstances. I will be buying mine at the end of the PCP and ending the deal.

Spent 10k outright on an 18 month old car with 3.5 years manufacturers warranty left 5 years ago. Will run it into the ground.