AIBU to spend £20k on our first car?

[starksausage]

I’ve never owned a car before. I’m in my late 20s now. Don’t own my own home but have enough for a deposit. Been with DP for 8 years.

We need a car for various reasons now and have found a used one we like for £20k. AIBU to spend this much money? We bring home roughly £10k a month and this would cost about £500 a month

She’s been saving a deposit for a house though hasn’t she?

I have a bigger house than you both

But a car loan would reduce the mortgage they could get.

In which case it is probably better to get a cheaper car.

What's the interest rate?

Have you bought a used car recently?

20k isn't expensive for a used car. It's maybe 3 years old I'm guessing.

Much less than that and you're looking at 10+ years old. You might want to roll the dice on reliability but the OP doesn't.

🤣🤣🤣

Like someone spending a lot of money on a bag, or going somewhere luxurious on holiday rather than Skegness?

DH likes his cars. He enjoys driving and owning them and so for him having a collection of nice ones is money well spent.

But why do they make sense but a nice car not?

Why are people like you unable to understand that different people get pleasure from different things?

Cars are depreciating assets. Look at the list of most reliable makes and then consider what the car is going to cost you to insure and to run. We have never bothered with flashy cars but we have, reluctantly, spent more than that on a new car we hope to keep at least 7 years.

I don’t think that’s too bad, and it’s a three year loan. People pay that on lease hire/pcp and have nothing to show for it after three years. A newer car will be more efficient, reliable and have a greater resale value at the end. However, with such a good income, could you pay it off sooner?

You are assuming that people dont want prestige brands cars and any old car will do - after all it just gets you from A to B. I like a premium car and buy via PCP so I get a new car every 3 years. I like that flexibility. I dont need to get it through a MOT. There are no unexpected bills. I just dont need to really worry about it. When I was younger I had old bangers and never knew from day to day whether it was going to start, need costly repairs etc.

If you follow this way of thinking what about just buying a 'house' doesnt really matter what it is. For some people cars are important. For others they are just a means to an end.

I'd love to know where you're buying your cars. I just looked and if you want a 3yo Toyota bigger than a Yaris, not practical for most, you do need to spend close to £20k.

For me, cheaper/older is a false economy. If I'm spending a large sum on a car, which it us whatever you buy, I want a few years from it. Most cars need money spending from about 5yo and become uneliable from 8/10 years, unless you're very lucky.

Obviously you have to buy what you can afford, but why would you choose to have an unreliable scruffy car, any more than you'd choose an unreliable washing machine or scruffy shoes?

You need to consider the impact that this car or any debt will have on you buying a house if you are wanting to buy within the timeframe of the loan.

Is having the car or the house a priority?

If this becomes a big enough problem they can just sell it again and probably recoup most of the money.

Used cars are expensive now so it’s a false economy to by a “cheap” one that’s still going to be at least 5k which will be scrap in a few years.

You can have a better car for a few years then sell it and the cost per year will be about the same.

Only if that’s a problem. They may not need to go to maximum borrowing capacity so makes no difference.

On 10k pm presumably they've built up the house deposit quite quickly. I'd spend some of the savings, rather than take credit, and then save (at least the £500 pm payment) to replace it, but I don't think spending £20k on a newish modest car is a stupid financial decision.

DH has the sporty Yaris.

It was not available used when he bought it and it cost him £33,000 new.

I think some posters have lost sight of what a débecte small used car costs nowadays. I know his is at the higher end but you are really not talking about anything crazy for £20,000.

If it is your first car, you are highly likely to dent it or scrape the paint or smash a light at some point. That is just life.

A PCP or leased car will be a pain and very expensive to keep pristine, which you need to do to if you want to swap it at the end of the contract.
The newer the car, the more expensive it will be for fully-comp insurance.

Pay outright for an old banger for the first couple of years on the road, then think about a nicer car.

The most important thing is reliability - not whether you like the design / how it looks etc. 20k is a lot to spend. You could spend half of that and get yourself a really good car. I have always gotten approved-used Skodas. They are built like tanks, super reliable and have never given me any grief. They just run and run, for many years with no hassle.

I voted you are being unreasonable as I’d prioritise a house over a car. Increase your house deposit and buy a car for £10k.
When you dent, scratch and scrape the car as expected especially in your first car you’ll feel awful. Also having a “cheap” first car is almost like a right of passage.
Obviously newer cars require less maintenance / cheaper to insure sometimes but it’s better to upgrade once you’re more confident on the road.
Congrats on passing your test!

Sec hand cars are v expensive nowadays. I’ve seen loads at the £20k price point when looking for one just a couple of months ago. When we last bought a decade ago that would have been a new and quite fancy car (relatively!). Our new car now is double what it was 12 years ago. Not same model but same kind of thing we were looking for. I wouldn’t buy on finance, though.

Out of interest I’ve just looked at Skoda used cars. They have 5,063 approved used cars. 74 are £10k or less.

the vast majority of them are £38-40k