How does everyone afford very expensive cars?

[Idratherbewithmycat]

Ok yes I live in an expensive area but I can’t help but notice that everyone seems to drive expensive SUVs. Some families I know have good but normal incomes (like us) and still drive massive cars (not BMW type but bug lovely peugeots or Kia etc). I was just googling prices as we could do with upgrading what we have and OMG, it’s a lot of money!
Do people usually buy their cars on finance or upfront? We only bought a car once, it was a second hand cheap-ish car we paid fully upfront. Don’t see how we would be able to fork out £25K + for a new car!

Quite a big difference between a £50k car and getting your nails done. Even a gym membership is not in the same ballpark.

I've never understood it myself. Could afford it but can't see any reason to. I buy a one year old car every 8-10 years.

😂

Most people buy cars on finance, changing cars every 3 years. I see that as wasted money, so choose to drive a slightly older car (20 plate). Plus (imo only) think it's silly spending £20k+ on brands like Peugeot, Renault, Ford etc.

Finance / loans / car schemes - you’ll be amazed how many people live life on credit

Same here. Rather have the cash for the immediate things like university accommodation.

We have plenty of cash.

I dont think they do. AI suggests 10-20% salary should be your car budget.
A new cheapish car is 20k which is well above this for most.
There are people with cars at more than their annual wage. Its madness.
On lease seems so backwards. Soon we will be going back to renting tellys and washing machines

Finance. We always like to do finance because a) you can get a nice car and b) you can get a new car regularly, which gives you the peace of mind that it's under warranty. We don't have a super expensive car, but it's a better one by far than we'd have been able to get if we purchased outright.

It's a lot of what people would call "dead" money, but that's what we choose to spend our money on.

PCP at the moment and moving to Sal Sac in a couple of months.
Our only debt is our mortgage and our only finance is a car.

If it’s helpful to help you work out, I got a really nice brand new, albeit basic spec Peugeot 2008 on finance in 2024. The market price was approx £24,000. My monthly payments are £275, which is a decent chunk but not entirely unaffordable

Husband has literally just got a new Volvo XC90. It’d be worth £60-70k ish new, but he got it with 2000 miles on it to bring the cost down to approx £45/50k. It’s a lovely, very grand car but it goes through work. If it didn’t, we wouldn’t go for something as grand

Just telling you this for balance as our cars are both nice but affordable due to our particular circumstances. So hoping for you that it could potentially be more affordable than you think

I have a Kia Sportage but not from new! 3yrs old it
Was 11,000 cars (a few years ago now though) car prices drop off massively in the first couple of years, I traded in my old car for 5000, the rest was savings.
I hadn't had a holiday abroad in 4 yrs before that though, and I didn't get one that year either! 😅
Now looking round downsize now we are out of the rear facing car seat and double buggy stage.
Don't really get the love outside of practicality of the big SUV cars and happy to back to a fiesta or similar!

Some people get company cars or car allowance.

I take the car allowance which has rules set for your car age. My current car i bought new on a lease, then when enough was paid off I switched to refinance on hire purchase as that option was now affordable. By the time it is paid off, my car allowance rules will deem it as too old so will have a new car again. But next time I will have a decent deposit from selling my car, so can go straight to an affordable hire purchase and then have a few years of no finance at the end. Could then potentially save what I was paying, add to what I will get back from selling that car and be able to just buy outright every 7 years.

Other people I know just like having a nice shiney new car every 3 years so they just do lease. They love cars and new car day gives them great joy and something to look forward to so money well spent for them.

In my case I was very fortunate to be given an inheritance so thought I would treat myself. Mine is only a small car though as I prefer them. I dont do many miles so should be able to keep it for a long time.

Most people finance. I have just bought a Range Rover and all the sales reps didn’t know what to do with themselves every time I said I had cash.

Wr used to buy our cars outright, spending approx 10k and we would get a decent family car. However since covid hit used car prices have rocketed.

We lease our cars on finance, it suits us. A brand new car every 3years, no mot costs and no cost to upkeep then as they tend to cause us no problems before we get a new one.

I'd say our car is one of our luxuries in life and we have a budget that we aren't willing ro go over.

So do we. We just choose to use it for different things.

Again, so do I.

Why do snooty mumsnetters think people only have lease cars because they don't have any money?

Like another pp said, dropping £8-10k on a used car is money that could be invested elsewhere - not spent on a depreciating asset. And used cars are not the money saver they used to be since their cost spirelled during Covid anyway.

Same here. Never had a car on lease, but we've had several brand new cars (or ex demos) over the years. Currently, like you, we have three. A brand new 24 plate, an ex demo (less than 5k miles) 72 plate and a brand new (when bought) 08 plate. All paid for in cash. We've always saved the equivalent monthly HP/Loan/Lease payment and used that to buy new. Tend to keep each car for between 8-12 years, the 18 year old one is an extreme just kept for personal circumstances (for son to learn to drive in and then use in order keep insurance low!) and will soon be sold, so we'd be back to just the 2. At first, I bought cheap old banger, and saved the "monthly fee", so after a couple of years, px'd it for something a lot newer (still a few years old) plus the amount I'd saved, continued saving each month, and third car was a 6 month old exdemo, again paid by px and the amount saved, then fourth car was brand new, and I've repeated that pattern ever since for the past few decades. DH had done exactly the same (even when we didn't know eachother), so we've been basically "leap frogging" each other for all the years we've been together.

I lease one paid for by my company (I am self employed). I don't do a lot of business miles but I do some. It's hugely expensive but I have included all servicing costs etc in the deal and 100% of the cost and 50% of the VAT is offset against my annual income so it is worth it for me.

I bought a 50k electric car about 4 years ago and hope it will last about 10 years without having to spend too much on it. It’s really cheap to charge where as I was spending £400 on month on petrol for my previous car. I had a limp sum and decided to spend some on a car and then keep my monthly expenses lower.
Before that I leased three new cars, and that also worked out well.

On lease
Use disposable income

We buy max 3 year old outright.

I’ve a Discovery Sport at the moment. DH is eyeing up a Velar or an XC60.

We do tend to run them until they’re 10, and replace.

Funnily enough, I was just discussing with DH that by the time I’m replacing mine, we’ll have to buy DS his first car. That’ll be an expensive year.

We have a company car worth about £25000 we could never afford this if we were buying it ourselves. It costs us about £200 in company car tax a month. We don’t have to insure it, service it etc. I think lots of people are driving around in company cars and like us wouldn’t be able to afford it themselves

My stepfather sells cars that are second hand (as in only on their second owner after a year or two) and he does a roaring trade.

I've bought and leased over the years. Over 3 years ownership (approx 60k miles) I've spent less money on leases Vs depreciation on a cash bought used car.

Depends on your circumstances so list some pros and cons and do what's right for you guys