Even moderately expensive cars..how do people afford them?

agent007 – Member

what’s more unexpected than a £30k loss come trade in time as per the guy with the Lexus above?

That’s pretty much a perfect example of “expected” tbh.

He certainly didn’t sound like he expected that? Still, perhaps he should have realised and yes, entirely foreseeable.

ransos – Member

I’d say for a lot of people (SE England excluded, perhaps) your image of motoring is the exception, rather than the rule.

Purlease. Most people use their cars for commuting, the school run and shopping. They are purely a convenient tool.

Eh? When I said ‘your image’ (referring to Binners’ motorway jam pic)in the bit you quoted, I literally meant the picture used. Nothing more.
I have no doubt that most people use their car for commuting, dropping the kids off and doing the weekly shop. But do most people spend most of their time sat in traffic on a motorway going nowhere? I’m not so sure.
I commute 22k miles/year which has gone down from 32k miles per year in my previous job. There was the odd traffic jam when there had been some kind of accident and there are always slow bits where the traffic backs up. But, I can’t think of the last time I was sat in a proper traffic jam going nowhere fast.
There’s still plenty of nice driving to be had in most parts of the country.

And is it really that surprising for car advertisers to show their cars being used in an ‘optimum’ state, rather than stuck in a traffic jam. Surely people don’t take the adverts literally? Or do people really think that Corsa’s are driven by little furry characters shouting ‘come on’, that Nissan 4x4s can leap buildings and that other cars (brand I have forgotten) causes large pots of paint to explode??

Its all personal circumstance isnt it.

We have got 1 £20k car, and till recently had a second Mondeo with 100k on the clock. Thats now gone and been replaced with a brand new Toyota Aygo on PCP. Put £300 deposit (would never ever put more than £500 in to a PCP) and £150 a month for 3 years, we know what the service costs will be etc, and will just get rid before MOT’s etc.
Next car will either be a Porsche or some form of sports car (second hand) to avoid huge depreciation.

It amazes me how much people are willing to spend on push bikes.

Had a company car via car ownership scheme. Given the pricing, it was easy to see which cars lost money – Renaults 😯 . So as others have said, most people don’t buy cars, they fund depreciation and promise to give it back in a reasonable condition. Cars that lose money slowest are therefore more affordable (relatively speaking).

Three years ago, I finally moved closer to work, and commuted by bike again. Had to fund the car for another two years, but it has been gone 13 months now. The car allowance pays for our aged Honda CRV, and I buy bike stuff instead.

The fact that I rode in today on a bike that cost the same as a decent car, is incidental, and I guess only a bike affcionado would notice the “status” it gives me 😉

Mate of mine still recons the best thing about ever owning* a porsche 911 is being able to say “because I felt like a c**t driving it” to any wannabbees that ask him why he got rid 😀

*Paid for from a nice % of a £1m plus sales deal at the time

amplebrew – Member
I completely understand why folks want and buy nice new cars, its all depends what you’re into.

Some people get a lot of enjoyment from owning a nice car and I don’t necessarily think they are trying to fill some kind of void.

Plenty of folks have a car as their hobby and get loads of fun from just owning and driving it; depreciation doesn’t even enter into the equation.

If you really had the hots for a particular car and can afford it; then does it really matter what the depreciation is?

There is no point making do with something else and being too sensible about it. A car is probably the next dearest thing people buy after a house, so you need to love what you’re spending all that money on.

I no longer run a car as I only work 7 miles away from work and I can get to the shops and trails without needing a car.

Agree.

I used to be quite into cars, but since moving to London I can’t even entertain the idea of car ownership, and if I did it would be a sub £1k banger. Having said that if I was on £50k a year I might look at this differently.

I commute 22k miles/year which has gone down from 32k miles per year in my previous job. There was the odd traffic jam when there had been some kind of accident and there are always slow bits where the traffic backs up. But, I can’t think of the last time I was sat in a proper traffic jam going nowhere fast.
There’s still plenty of nice driving to be had in most parts of the country.

You must tell us where these wonderful empty roads are. So I can cycle on them.

You must tell us where these wonderful empty roads are. So I can cycle on them.

They’re by me. 🙂

What I don’t get is really how can people afford to run these cars, with the price of petrol the thought of having a Range Rover drinking all that would make me sell it.

I have asked myself the same question many times as I also earn a fair bit over the nation average yet don’t feel that I could afford a new expensive car.

The question was partly answered when I re-mortgaged with FirstDirect and had a phone application where the very nice lady went over my bank acct during the process.
She was amazed that I had no bank loan, no car, loan, no lease, PCP, no maintenance, no credit card bill etc. It seems we are in a very small minority in saving up for things before we buy them (house excluded of course)

We save money every month and have a enough to live on for quite a while should something unfortunate happen – very very few people are in this situation and live month to month. If I took most of our savings and didn’t overpay the mortgage (even better switch it to I/O) then I could pay for a very expensive car.

no bank loan, no car, loan, no lease, PCP, no maintenance, no credit card bill etc

Add no mortgage to that list and you can see why some people can afford expensive cars….

tonyg2003 – Member

no bank loan, no car, loan, no lease, PCP, no maintenance, no credit card bill etc

Add no mortgage to that list and you can see why some people can afford expensive cars….

Some may still live with their parents so no even food bill …

I am in the some situation as DaveRambo up there – no debts apart from the mortgage. I drive an ‘expensive’ car but it wasn’t expensive to me. £40k car, bought 3 years old for £11.5k, now 8 years old with 180k miles. So in 5 years, it’s cost me <200 a month in depreciation. I’ve had one ‘unexpected’ bill for £800 but apart from that it’s only needed routine stuff, so I guess all in costs including that depreciation, maintenance, tyres, insurance, road tax is about £3500 a year. If I was to have the same car on my company car scheme the net deduction (lease cost + BIK tax) from my monthly pay would be about £800 – or £9600 a year. Plenty of people in the company do think that that is money well spent – I don’t. But it’s their choice.

ransos – Member

You must tell us where these wonderful empty roads are. So I can cycle on them.

I never said empty and I never said suitable for cycling on.

But, I commute round Peterborough, down the A1 and then onto the A14. Parts of the A14 get a bit slow, but nothing majorly bad for the stretch I use. Admittedly, other stretches of the A14 are a nightmare if you hit them at the wrong time…..
Prior to that it was the same, but carrying on down the A1 to Letchworth. Again – no real snarl ups, except for a bit slow at Black Cat roundabout and I had quite a few back road routes stored up in case of any major issues.

Not great driving roads, admittedly (quite the opposite in fact) but far removed from binners pic of total gridlock, which was the point I was trying to make….
I have been to Wales many times, Yorkshire, the Peak District, Devon & Cornwall, The South Coast around the New Forest, up to Scotland, Cumbria etc. and there’s been plenty of excellent driving (and cycling) roads almost devoid of traffic….

I’ve lost count of the number of chavvy looking folk I’ve seen driving decent motors. Not saying they’ve not grafted for them, but I reckon a fair few bought council houses on the cheap (discounted) and are sitting on a stack of cash as a result, especially down here in the SE.

This is an outrage ! I was saw a chap wearing a footbll shirt and driving a rover, they`ll be playing golf next!!

Where I live in Surrey the big houses always seem to have old bangers outside and the smaller ones and flats seem to have the 911s, Astons etc. Funny that.

‘Two cars on the drive, nothing in the fridge’ as the saying goes.

It more socially acceptable to shout how well you’re doing by driving down the street in your Aston than walking round holding up your wallet or shoving your Rolex in peoples’ faces.

Another way of looking at it:

Buy new car at 25K, depreciation 12.5K in 3 years cost = £347 a month
Buy same car second hand 12.5K depreciation 6.25K in 3 years + additional put asside for tyres + repairs + cambelts etc (say £2k) = £229 a month

Thats £118 a month extra for the peace of mind of a totally new warrantied car that was 25K new eg octavia golf etc..

OK I havent included interest on the payments but you get the idea.

theres a guy in our street must be very early 20’s, he drives a 13 plate Audi A3, rents his house and works in a local factory on an average wage.

he told me he took out a massive loan for it, he doesnt drink or go out much but the car makes him happy.

theres also a recent housing estate near us that has just sold the last new house, i know a few lads who live there (all have 1-3 year old audis, mercs, jeeps)and its all about the ‘image’ they freely admit they dont have a pot too p*ss in and are loaned/credit carded up to the max and all have interest only mortgages and its all about the image!

end of the day each to their own.

As above, paid for by lease/loan, it’s always been cheap to extend the mortgage a bit if you don’t want to go car finance route which is more expensive, if you are disciplined you are not increasing your debt over the life of the car. New vs older, cars these days have 24 month service internals and very low costs over first 4 or even 6 years

BTW all you lovers of the BMW M3, you can buy a Porsche Cayman for the same money, 2 vs 4 seats but a much better car

Bloke I know works for Ford. He’s a pm in engine design, and gets two cars at a time. Only catch if you can call it that, is that they’re only allowed to keep them for a few months then they go back and he gets a new pair. Pretty much pick of the range, always top spec cars. Oh, and one of them is always a seven seater that goes to his sister in law to use for her child minding business- he doesnt even need to keep it for his own use. In the old days it was a disco, but obviously galaxy’s now.
I’ve never dared ask him how much the scheme costs them, or the ins and outs of it. I’m guessing not much but it’s a hell of a bonus.

Not great driving roads, admittedly (quite the opposite in fact) but far removed from binners pic of total gridlock, which was the point I was trying to make….

It’s a photograph – how do you know it’s gridlock? All you seem to be doing is confirming that driving is mostly a chore unless you’re in a part of the country where there aren’t many jobs.

I’m kind of with the OP except maybe I’m willing to just go with the idea that people have different priorities to me.

I have an 09 Mondeo. It was approx £13k when I bought it at 8 months old. That’s plenty for me as it’s big (I’m tall), has plenty of space to be convenient, isn’t too thirsty and I like driving it. I just can’t see what I’d gain out of spending more given that it is just a tool for getting round (and I’m no car hater – I love cars as it goes but I think I’d only ever want something fast if I could actually take it round the track regualarly).

The funny thing I find though is when I meet other people at similar level to me professionally – they almost invariably seem to drive Audis/BMWs as company cars. I did the sums and it just didn’t make sense to me – not even close actually – so I took the allowance but I always get the impression that they’re suprised that I ‘only’ drive a Mondeo and don’t want an Audi or BMW. In fact, I know a few have asked about me behind my back to check that I’m not just pretending to be on their level professionally…

I guess it’s just a cultural thing isn’t it? Success = house, car, family. Car is often the most visible.

I bought a new car recently (sorry Cougar), the salesman wasn’t a bit surprised when I replied “cheque” when he asked how I wished to pay. It had a negligible impact on my disposable income and I don’t use it for any of the following except for objects to big to carry on a bike.

Most people use their cars for commuting, the school run and shopping. They are purely a convenient tool

It’s a toy, a nasty polluting toy, so I try not to play with it too much.

As for a status symbol, my neighbours would be more impressed by a 2CV than any modern car but a 2CV won’t swallow three people and their bikes.

Bloke I know works for Ford. He’s a pm in engine design, and gets two cars at a time. Only catch if you can call it that, is that they’re only allowed to keep them for a few months

& then sold on the the unsuspecting public as ex demos?

Another way of looking at it:

Buy new car at 25K, depreciation 12.5K in 3 years cost = £347 a month
Buy same car second hand 12.5K depreciation 6.25K in 3 years + additional put asside for tyres + repairs + cambelts etc (say £2k) = £229 a month

Thats £118 a month extra for the peace of mind of a totally new warrantied car that was 25K new eg octavia golf etc..

OK I havent included interest on the payments but you get the idea.

Bit exagerated to assume that a new car would require no maintenence, and yes you conveniently forgot the interest payments on your loan which at 7% typical would be around £70 a month (assuming you financed the whole car) or probably similar payable to a lease company (i.e. their profit) if you leased. Add an annual service (at main dealer prices to avoid voiding the warranty) and say a full set of tyres in the three years and you’re looking at around £1.5k or £42 per month.

So new car would cost £459 per month, second hand would be £229 a month – or £230 cheaper. If you’re a higher rate tax payer then you’d need to earn an extra £4k a year to cover that!

Don’t forget that with the way cars are made these days then a 3-6 year old car usually won’t require significantly more maintainace that a 1-3 year old car, particularly if you buy well, plus all the recalls or niggles that you often get with new cars will have normally been sorted by the first owner. With a car outside the warranty period you also have the option to service at an independant specialist, at around half the cost a main dealer would normally rip you off by.

Rather you than me, and my peace of mind comes from knowing I always actually own my cars and could sell whenever if circumstances change, plus splitting the extra I save between a retirement investment and the odd foreign holiday – paid for with money rather than a loan.

Whatever floats your though boat I guess.

its all about keeping up with the neighbors/ colleagues etc

the funny thing about croozing around in flash motors- ive got mates that work in the city with some truly tasteless (to me) porches, bmws, convertibles etc, they see them as ‘fanny magnets’
but in reality its mostly blokes that check you out as you are tearing away from the traffic lights like the stig or looking cool on the scene driving past bars in kensington

however when I had a summer job working for the council in 2.5 tonne builders trucks…copy of TheSun, maccyD wrappers on the dash- all the cliches I was amazed at the number of women that slyly (some not so slyly) glance up to the cab

Was that after you did that Diet Coke advertising campaign though Kimbers? 😀

binners – Member
Was that after you did that Diet Coke advertising campaign though Kimbers?

when they saw me and my mate driving they usually just looked away dissapointed

so I took the allowance but I always get the impression that they’re suprised that I ‘only’ drive a Mondeo and don’t want an Audi or BMW. In fact, I know a few have asked about me behind my back to check that I’m not just pretending to be on their level professionally…

That’s one of the most tragic things I’ve ever heard. And sort of says it all about why certain people buy certain cars. The kind of people that marketing departments wet themselves with glee over. Talk about desperate insecurity!

Ha ha I turned up for my 1st IT contract role in a battered old Micra, the others thought me a bit odd as they had Beemers and the like. The thing is I lived in London and rarely used my car and had to leave it on the street so it was ideal for that.

To all of you saying “how do people afford expensive cars” there is probably a forum somewhere of people saying “how do people afford £1K on a bike”. It’s all relative.

It is indeed all relative – I doubt there are actually people asking how others can afford a £1k bike – why people would spend that much on a bike, maybe, but not afford. The thing is, even that “cheap” PCP mentioned up there costs a total of £5700 over 3 years, which is several thousand more than my car is likely to cost over the same period (my last car cost ~£800 a year in depreciation, I’m expecting the current one to do rather better), making “expensive” bikes very easy to afford given the same amount of income.

It amazes me how much people are willing to spend on push bikes.

A lot less than you’re spending on a basic boring car?

People say they buy new cars because they don’t want any unexpected bills

They replace the chance of a big bill with the guarantee of an even bigger loss due to depreciation 🙄

Funny thing with cars as status symbols is they dont point you out as rich, often more aspirational.

Most of the properly rich people I know seem to drive around in battered old Peugouts or similar.

So as said before, its leasing when you pay for the difference between new and resale, people getting hocked up usually with the cars previously leased and there are rather annoyingly quite a lot of people out there who earn six figures or have done well in property,investments or inheritence.

Buggers..eh, mind due we all like a car that start, stops has a good radio and the aircon works.

I worked with a contractor who prefaced everything with it’s value and brand (i.e. I was driving my 34K Audi after watching my 3K Sony TV while drinking a £40 bottle of Lindernams ). Bit sad really.

Oh well, he’s married with kids now and he’s driving round in a 15k Piscasso 😉

Certainly not jealousy…just curiosity. I just wonder how the school run car park can be so full of Discos, Range Rovers, Audi’s, BMWs etc…I would love any of them frankly, and there’s me in my crappy Insignia, which cost me £10k….I won’t feel quite so inadequate knowing that they’re all ‘renting’.

To me 10k on a car sounds a lot.
We have 3 mortgage payments till the house is paid off. Next year we might buy a new(er) car but it sure won’t be 10k.
I have just spent 1200 quid on a push bike frame though.

TBH I was raised to be a bit debt averse and while I’m hardly rolling in savings, I’m not really up to my eyeballs in debt either (Ignoring our mortgage).

I’d just see a shiny new motor as a scary, money sucking financial millstone, I’m sure we have the credit rating to go out and get ourselves neck deep in finance in the pursuit of a Blinged out chav mobile, but we’ve resisted up to now…

I think people are too quick to overlook the joys of bangonomics these days, you can buy some ridiculous mid 90s-mid 00s cars for peanuts…

Can’t afford an M3 you say? I bet You can if you’re willing to compromise on New & Shiney-ness, find something W/X reg in reasonable shape under 120K, drive it for 6 months, decide you’re not actually that much of a boy racer, then chop it in for about even money (assuming the gearbox lasts) and embark on your next bargain bin motoring adventure…

The other thing is that certain 10+ year old cars carry on working really rather well and are still perfectly serviceable, I’m always noticing just how many Mk4 golfs of a similar vintage to our own, on W/X/01/02 plates, these are “Old” cars by current standards but there’s still a lot of them going…

“the funny thing about croozing around in flash motors- ive got mates that work in the city with some truly tasteless (to me) porches, bmws, convertibles etc, they see them as ‘fanny magnets'”

Where as most people will assume they are some kind of penis extension.

Has the car you drive ever helped pull a member of the opposite (or maybe the same) sex? I drive a 1965 Beetle and the only admiring glances it gets are from other middle aged chaps. And I am certainly not interested in them.

What he says ^^. Our 9 year old mondeo doesn’t have a bit of rust on it.
Cars last so much better these days.

Not having a car and having to hitch hike resulted in many propositions from both sexes some of which I was happy to accept. Then I bought a car and got married. However recent hitching has confirmed that the offers are still there even if I politely decline.

Not having a car and having to hitch hike resulted in many propositions from both sexes some of which I was happy to accept. Then I bought a car and got married. However recent hitching has confirmed that the offers are still there even if I politely decline.

Do go on….

Edukator?