Paying monthly for a car? Should I do it?

[Bruminbrum]

Hi all,

could use some car advice. I’ll caveat this with, I’ve never taken anything out on lease or purchase.

we have as a household 2 cars owned outright. One 7 seater that I think we could see for c£13/£14k and one hatch back we could see for c£7/8k (but the car is getting a bit old now so could really be replaced and I’ve been wanting to for a while)

my company now has a new electric vehicle scheme, and they’ve got my 7 seater available for £500 a month, including charging point, insurance, energy credits, road tax and services rolled in. Should I do it? We spend about £100 a month in fuel per car and insurance annually is about £800. It would get deducted from my salary and my husband would set up a standing order for half.

it would take our household income to c £6k a month inc child benefit (which we save for the kids)

we’d then sell the hatch back and get another run around car, for c£11k and then invest the rest.

we’d need to tighten our belt on a few things like eating out and tbh frittering money away but we typically save around £1k a month, so reckon we’d still be able to save £800 a month. Plus then £8k going straight into the bank. Thoughts?

As this is a lease there is no balloon payment at the end.
there would be, as you said a surcharge if you go over the mileage.

if I took a 50k loan? As that’s the cost of the car new. Car finance the apr is usually sky higher but unlikely to get a 50k unsecured loan, so that would be additional borrowing on a mortgage. Probably £300 a month depending on term and rate.

my cars need a little bit of work, but they are looking a bit old (well aware this is a status and vanity thing)

50k loan, yeah tough one. I wouldn't buy a 50k car. I mean I have more than enough cash in the bank to buy one but I still wouldn't get a 50k car. I wouldn't finance a 50k car either. 😀

But I appreciate plenty of people would. I'm quite happy being the person driving the Ford when all my mates have got Mercs! I always laugh and say I have the worst car in the car park at the health club.

Most people i know seem to lease their cars, my work does a similar scheme to you.

But im old school and I like knowing that after x date my car payments end and I own the car. I just finished paying mine off after 5 years and im over the moon as I adore my car. It's nothing fancy but it was the first big thing I bought myself when I returned to work after 10yrs as a sahm. I plan on keeping it for as long as possible.

Car prices these days scare me. My car is 7 years old and worth more now than I bought it for which is bonkers! It's not a "cheap" car but not a luxury car either.