Agador, yes I think lease salespeople play on worries about cars becoming less reliable.
Increasingly, people seem unable to cope with the idea of any unexpected expenditure, or anything which doesn’t come out as a certain monthly direct debit. So people worry not so much that their car might break down (and actually modern cars are very reliable) but about needing to spend any money on anything. Even the thought of £200-£300 for servicing seems to really worry some people. And cars do involve costs…they need new tyres and servicing and the replacement of certain parts, even when they continue as reliable cars.
So I’d say, if the idea of paying out £400 at some point during the year fills you with extreme worry….to the point that you will take on a financing scheme that essentially will cost you more than this over time, some work on budgeting would probably help long term. Or I guess, we can just accept that people in their bid to avoid any uncertainty will always pay through the nose.
It’s the same with lots of things. People have a dread of needing a new boiler or their pet needing vet treatment, or their washing machine needing replacing, or their pipes freezing. So they take out lots of costly policies which feel affordable on a mo they basis and give certainty, but essentially cost loads more.
It’s as if people don’t trust themselves with their own money. They don’t trust themselves to put SOME of the money they spend monthly on car payments, servicing plans, insurance policies for multiple things etc, to accumulate some money, so that when ONE of those things happen, they have some cash they can draw on. Rarely will ALL of those things need spending on, and paying up front or as and when needed is almost always cheaper. But perhaps it’s too worrying and people don’t trust themselves to budget and manage a bill. And perhaps they haven’t got any patience at all, to wait the necessary few months for savings tos cumulate for the first purchase…so they get into a cycle of leasing/monthly policies. And it absolutely is a cycle, because if you have hundreds coming out every month, to pay for the car you already have, and a service plan and a vet policy and a boiler policy and….then it’s so much harder to ever save any money. And this partly accounts for why some people genuinely have practically no savings, but somehow are driving a new car.
It really is a salesperson’s dream, that people have these fears about an expense. You only have to go into the dealership to see posters telling you have much a new exhaust or cam belt can be, but you can avoid that by paying £x per month for ever.
In my mind, lots of people having a new car every 2-3 years basically can’t afford it. They are living beyond their means. It kind of feels affordable to them, because they don’t then equate the fact they haven’t managed to save a house deposit, with the fact they are replacing a financed car every 2 years. Or oerhaos the fact that retirement will need to come 5 years later, because over 30 years, the extra expenditure on cars might amount to really massive pension contributions.
Sorry, boring I know and not in the spirit of this thread, where leading or finance is a given and people just want advice about the cheapest or best way to do it.