To ask, if you have a car, how much you pay per month?

[Threeflyingducks]

I've had three cars in my lifetime, each one so far has been budget/secondhand and paid for outright. For the first time I'm looking to buy a car and pay per month (PCP). My days of cheap runarounds are done, I need something that is reliable for high mileage/long journeys and can fit a gaggle of children/friends in when required, with good safety standards.

Having never had a monthly car payment going out I'm a bit daunted tbh, and would appreciate views! I know it's going to be relevant to respective incomes, I'm just curious what other people see as reasonable. I've heard that lots of the very fancy cars on the road are bought by people on very low mileage/leasing so their options are more affordable than they might appear. But then a work colleague proudly told me that his car (a top of the range SUV, to be fair) was 'only' £300 a month and I thought cripes thats more than my half of the mortgage!

I know how much I'll be paying will be skewed by needing to do a lot of miles (unavoidable currently due to rural-ish location and using the car for work) but I'm curious about what people consider a typical range. Right now everything seems like such an indulgent amount, but that's probably because it's not that long since my travel expense was a weekly bus pass!

I know nothing about leasing cars. Are these payments with insurance included? Surely insurance payments would be higher on a leased car?

I took out a 5 year loan last year to buy a 2 year old Toyota c-her with 5000 miles on clock, top of range and automatic

I’d eyed one up for years and finally took the plunge it’s costing £260 a month which on reflection was silly BUT does Mean I owe it and am not locked into an endless hire agreement

I have a fairly high spec 8yo VW Touareg. I have a bank loan for it and it costs me £289 a month. I have to have a monster car as I tow a horse (am totally on board with the priority list a pp shared 😝

I fear PCP because my car does so much. I'd permanently be worried about scratches, dents and mileage.

Audi Q2 £262pm including insurance, tax, breakdown, tyres, Windows & servicing. Brand new vehicle every 3 years

*Windscreen

You should only spend 1% of the value of your house on a car. Cars sit there losing money. Houses make money over the long term. Prioritise your house.

1% would buy many people a rust bucket.

@Imcneil003 when you say 1% of the house value, do you mean in total?
Because outside of London that means the average person will be spending between approximately £1,200 and £3,000 on a car. That isn't going to get you a decent or reliable motor these days.

1% is tiny. My car cost 2.5% of the value of my house - and I expect that's lower than most.

Dacia Duster - picking it up today - £200 a month for 3 years with servicing

I had a Kuga for years - but Ford has got too expensive

I’ve had the same car for 17 years. Looked into PCP , HP and Bank Loan but it seems a waste of money while my jam jar is still so reliable. Fortunate that my man is a mechanic so I have no garage bills. I guess it’s electric at sometime , the new E Jaguar maybe.

@lmcneil003 I'm an 'essential car user' at work meaning I have to have my car with me at work to do my job, my job pays for my house, yet at your calculation I shouldnt spend more than £1500 on a car?
I've read some strange logic on MN but that's up there!

I know nothing about leasing cars. Are these payments with insurance included? Surely insurance payments would be higher on a leased car?

Some finance options can include insurance, some include servicing, some do not.

PCP is not the same as leasing

Leasing is not the same as HP or PCP

There are a lot of different finance products with different terms and conditions.

Insurance can actually be lower on newer cars - or higher - depends on the person/region/car/occupation etc etc

BTW it is a total myth that old high mileage cars are automatically less reliable, although I understand the appeal of the idea that the seller has to mend stuff under warranty for the period of warranty.

I don't think that's really true - yes there are some cars that just keep going, but even a car that has a long life span is going to need more repairs beyond a certain age. It's just wear and tear. It might mean you can get something changed/replaced and be back on the road but that's not practical to be doing too often when you need the car for work.
The other factor for me is a lot of the long lifespan older cars are big engines and/or diesal. The former isn't good if you're paid per mile, the latter isn't a route I want to be going down, especially as someone with respiratory issues.

There's no right way for everyone to do it. Some people will prefer a lease, some will prefer PCP, some will prefer buying a £500 banger and running it into the ground.

I PCP'd a couple of cars when PCP first appeared - it seemed like they didn't exactly know what they were doing and it meant that both times I was able to recover the £8k deposit I put down on them at the end of the term. Stuff like that doesn't happen any more as they're much tighter on it.

For the last 5 years we've been leasing our 2 cars as I got amazing deals, but we only do around 9k miles p/a per car. The deals recently haven't been so amazing, so one of them got switched for a newish used car. Might be lots of good lease deals popping up in the next few weeks though...

Leases are good because they're relatively cheap if you find a special offer and you're not doing high miles (12k+ p/a). You generally get breakdown cover included and car tax will be paid for you - with the warranty you basically just have to insure and fuel it on top of your payment. It's also delivered to your door. They are not more expensive to insure than if you owned it. If your credit score is a concern, leases are also good as you only get the total cost of the lease added to your file - not the whole cost of the car as you would with PCP or other loan.
Currently got an Audi Q5 for 3 years with £2.5k initial rental then £285/month.

The other car we have is on HP that I set up with my bank, who then paid the seller directly. A 2 year old Mazda 6 at £220/month for 5 years. Hopefully it should be worth £4k or so at the end of the term and not cost me too much in unexpected bills (touch wood).

It would also be perfectly possible to spend around £5k on a car that will suit your needs and be reliable for 5 years - but you have to find it first and any bills that crop up are your responsibility.

Pistonheads has a 'Car Buying' forum - if you start a thread there detailing what kind of car you want, your driving profile and budget then you'll get plenty of people offering advice and cars that would suit.

£500 per month (or just under, I think). Forget the final payment, it’s a waste of money and I have never bought one out; I prefer to upgrade for the same amount per month and get a newer model. For me cars provide a service, like a cell phone. They aren’t an asset. Important to also factor in the money saved on servicing, repairs, breakdown cover etc on a lease.

£244 pcm salary sacrifice. Over 4 years

I agree that there's no right way for anyone to do it, so you have to make your own decisions OP, and just because someone else decides that £500 pm is reasonable on their budget and circumstances, while someone else buys a car outright for £500 in total, because that suits them, doesn't mean that either are right for you.

I do agree to an extent about seeing PCP/leasing as buying a service, rather than an asset and it doesn't even need to be that expensive, particularly if you can manage with a smaller car and don't do massive miles.

A couple of years ago, I had a PCP on a new Skoda Citigo for £130 pm for 10k miles pa and that covered servicing and breakdown cover too and I didn't even need to pay a deposit.

You'd struggle to run any car for much less when you take MOTs, repairs, breakdown cover, and the purchase price into account. I didn't even need to put any tyres on it because the original ones were still (just about) legal, when I returned the car.

I agree with @Barbara - £130 pcm for 10K miles/year inc servicing and breakdown would be tough to beat in any form.

Toyota Yaris Hybrid on 4 year plan - I was paying £148 for three years, then when it came to paying off the final payment of £3k they allowed me to finance that as well (I was happy with my car and didn't have any car in mind that I wanted to switch to). I wanted to pay it off in the year (I could choose how long I wanted to finance it) so my payments jumped to £284. Just paid it off and now the car is mine - don't have to worry about any payments whilst I'm on maternity leave now.

the latter isn't a route I want to be going down, especially as someone with respiratory issues.

Modern Euro 6 diesels are very clean - and they remain better for the environment in that they don't emit as much CO2 for distance travelled.

They are fitted with particulate filters so don't have the PCM concerns associated with older diesels.

I’m about to swap a fabia at £135/pm for 10k which I’ve had for 3 years for a facelift model at £152pm. I had a small amount of negative equity as I had no bells or whistles and the car was standard colour. Two years servicing, first year tax, no mot for 3 years roadside assistance and a warranty included, 0% finance for 4 years and no deposit other than a dealer contribution of £2.5k

I am totally shocked by these figures. We have always bought low mileage cars a couple of years old and used them to the death.

DD1 is currently driving a 17 year old car that has gone through the whole family, DD2’s is about 14 years old. Both running fine because they have been well maintained by us for all those years. Yes there has been the odd big bill along the way but nothing in comparison to the numbers above.

only ever paid cash. i currently drive a well loved 2006 ford focus, whose value doubles every time i fill the petrol tank.