Anyone into cars but not credit?

[ShadyDuck]

It really is up to the individual how they use their money.

For me, life has changed a lot year to year.

Although my job is very secure in my industry, I still like the idea that should I loose my job that the vehicles in my garage are not a (monthly) financial burden. If anything one of them at least is an appreciating asset that I could sell to get me out of trouble. The only thing I need to worry about would be mortgage and food, and for me personally, is comforting to know.

I don't drive new cars, but I don't feel I need too. Each to their own I guess.

[twoblacklines]

daemon said:

That point doesn't need to b made - the £600 a month car in the original post ISN'T an a3 tdi.

400 posts in and people still haven't read the OP properly, amazing isn't it????

[NickCQ]

daemon said:

Why? Surely it hardly encourages people to put their money into the "safe hands" of our banking industry to get a 1% return?

People need to be encouraged to put more into penoon planning, yes absolutely, however savings rates don't do that.

No, I never suggested a 100% cash savings portfolio. Personally I'm about 60% global bond funds, 20% global equities and 20% UK equities, with a couple of k in cash as a liquidity buffer. All my market investing is done through Vanguard or similar low cost passive funds, so no 'evil' banks intermediating me (although I have exposure on the equity side clearly).

I'd be happy to see 2-3% annual real growth - the power of compounding means that I should be OK at my target retirement age.

[anonymous-user]

Granfondo said:

I don't see how asking someone about their new car is anyway passive aggressive but you do seem to read into things differently than normal people!

P.S. I quite like the GLA 45amg so was interested in how he found his new car but the insults start so before it ruins the thread and people go off running to the mods I will try not to reply to you or D.

Edited by anonymous-user on Sunday 23 October 12:48

Brilliant edit

Nobody's going to run to the mods.

I can lend you a spade if you like ? Alternatively I can point you towards Mercedes Benz UK finance offers page to help you better qualify that new found interest funnily enough not mentioned on a more obviously relevant thread ?

Or of course you can follow entirely expected form and say " I'm not talking to you na na na"

Would you like to expand on the debt peddler point ?

[anonymous-user]

NickCQ said:

No, I never suggested a 100% cash savings portfolio. Personally I'm about 60% global bond funds, 20% global equities and 20% UK equities, with a couple of k in cash as a liquidity buffer. All my market investing is done through Vanguard or similar low cost passive funds, so no 'evil' banks intermediating me (although I have exposure on the equity side clearly).

I'd be happy to see 2-3% annual real growth - the power of compounding means that I should be OK at my target retirement age.

And frankly you'll do at least as good a job as many pension fund managers all whilst maintaining a sense of control of one's destiny.

[NickCQ]

RSK21 said:

And frankly you'll do at least as good a job as many pension fund managers all whilst maintaining a sense of control of one's destiny.

I hope so! The level of fees I pay to any manager is pretty much the only thing I can control with any certainty - so I try and minimise it.

[Driver101]

The level of debt people take on to own a car I find concerning. Maybe it's just the internet making it more transparent as people now openly talk about their finances whereas they were a taboo subject in the past.

The way people openly admit to being in huge debt and working out the least expensive way to pass negative equity on to the next car if it's normal I just don't agree with.

People are taking 4 year PCP deals out to keep monthly payments low then can't even keep the car until the breakeven point. That says to me they really can't afford the car. They say as they meet the monthly payment shows they can afford it.

I don't understand how finance is now so relaxed that you can walk out with a £50,000 car with just a few hundred pounds deposit.

[Granfondo]

Driver101 said:

The level of debt people take on to own a car I find concerning. Maybe it's just the internet making it more transparent as people now openly talk about their finances whereas they were a taboo subject in the past.

The way people openly admit to being in huge debt and working out the least expensive way to pass negative equity on to the next car if it's normal I just don't agree with.

People are taking 4 year PCP deals out to keep monthly payments low then can't even keep the car until the breakeven point. That says to me they really can't afford the car. They say as they meet the monthly payment shows they can afford it.

I don't understand how finance is now so relaxed that you can walk out with a £50,000 car with just a few hundred pounds deposit.

[anonymous-user]

Driver101 said:

People are taking 4 year PCP deals out to keep monthly payments low then can't even keep the car until the breakeven point. That says to me they really can't afford the car. They say as they meet the monthly payment shows they can afford it.

I don't understand how finance is now so relaxed that you can walk out with a £50,000 car with just a few hundred pounds deposit.

I don't understand the keep until breakeven point - can yu expand on that ?

As for relaxed I'm assuming that because it's all asset backed and usually funded by the manufacturer it's a game of volume versus risk .

[Fox-]

RSK21 said:

I don't understand the keep until breakeven point - can yu expand on that ?

He is presumably talking about people who VT the car at 50% of balance repaid.

[f1nn]

Different people with different financial situations have different opinions on how best to fund different vehicles for different uses at different times, non of which is anything to do with anyone else.

I could look out of my window now at my neighbours cars ranging from various Audi's BMW's Mercs etc, through to 206's and Focus's of all ages and I'm sure however they all funded them make sense to them.

If I was to keep my current car, or lease 50k's worth of white Audi, what concern is that of anyone else?

Edited by f1nn on Sunday 23 October 13:41

[Driver101]

RSK21 said:

I don't understand the keep until breakeven point - can yu expand on that ?

As for relaxed I'm assuming that because it's all asset backed and usually funded by the manufacturer it's a game of volume versus risk .

They are taking cars out on 4 year PCP deals and keeping them for 2 or 3 years. At the end of the 2 or 3 years they owe more than the car is worth. The negative equity is then added on to the car they purchase next.

The dealers are massaging the negative equity as it's hidden into the discounts that should be achieved. The end result is they find themselves even further in debt with the latest contract and will struggle to get back out of negative equity.

[NickCQ]

f1nn said:

I was to keep my current car, or lease 50k's worth of white Audi, what concern is that of anyone else?

I'm really not trying to refer to any specific posters here, but I get the sense that there are some people out there who feel that the vehicle pecking order is being upset by leasing. Time was where you could feel a little superior about having a £50k car because it indicated some level of financial success. Now anyone can get their hands on one, that feeling has gone away and the signalling value of the status symbol has declined.

[Driver101]

Fox- said:

RSK21 said:

I don't understand the keep until breakeven point - can yu expand on that ?

He is presumably talking about people who VT the car at 50% of balance repaid.

People aren't making 50% of the payments. For most PCP deals I see the 50% is only made very close to original agreement anyway. The GFMV is often around the 50% for the expensive German cars.

[twoblacklines]

My main issue is that people like this friend say to me "You can't be doing very well in life owning that" points to 57 plate A3 tdi, which costs me very little to run, insure and tax, and is paid off in full... and then saying to me "If you did better you can get yourself one of these" - points to brand new S5 sportback...and proceeds to tell me all the virtues of personal leasing, that after the lease ends he just "hands it back" and its "cheaper than buying new".... and yeah a bit of me dies inside because if that is true then, great, but I was brought up that if you don't have it in the bank then you don't buy it that simple... and if I have £50k in my bank it is better to invest it than spend it on a depreciating asset anyway.

The point is you get judged on what car you drive by people who "own" a car that doesn't actually belong to them, it belongs to the finance company, its pretty ridiculous.

[twoblacklines]

NickCQ said:

I'm really not trying to refer to any specific posters here, but I get the sense that there are some people out there who feel that the vehicle pecking order is being upset by leasing. Time was where you could feel a little superior about having a £50k car because it indicated some level of financial success. Now anyone can get their hands on one, that feeling has gone away and the signalling value of the status symbol has declined.

That accurately sums up my situation, yes.

Though more on the flipside that people who own "sheds" are being sneered at by people who think they are big because they can "own" a status symbol that they can't afford to go out and buy.

[anonymous-user]

Driver101 said:

They are taking cars out on 4 year PCP deals and keeping them for 2 or 3 years. At the end of the 2 or 3 years they owe more than the car is worth. The negative equity is then added on to the car they purchase next.

The dealers are massaging the negative equity as it's hidden into the discounts that should be achieved. The end result is they find themselves even further in debt with the latest contract and will struggle to get back out of negative equity.

I understand your point but I would add that the underlying issue of sales people seeking the best deal for the vendor as opposed to the purchaser is one that's been around as long as people have people been buying and selling cars via car dealers irrespective of funding. Surely it's a case of being a savvy buyer and taking the effort to structure how you buy a car as best as you can ? There are ways to fund a car (depedning on the car) where finance products can be used to positive advantage vs a cash purchase. The relaity is though that not all finance are thought through in such a way, just as I supect that many many cash purchases aren't either.

[f1nn]

I think the issue there is the people you class as friends, not the way in which you fund your vehicle.

[anonymous-user]

twoblacklines said:

My main issue is that people like this friend say to me "You can't be doing very well in life owning that" points to 57 plate A3 tdi, which costs me very little to run, insure and tax, and is paid off in full... and then saying to me "If you did better you can get yourself one of these" - points to brand new S5 sportback...and proceeds to tell me all the virtues of personal leasing, that after the lease ends he just "hands it back" and its "cheaper than buying new".... and yeah a bit of me dies inside because if that is true then, great, but I was brought up that if you don't have it in the bank then you don't buy it that simple... and if I have £50k in my bank it is better to invest it than spend it on a depreciating asset anyway.

The point is you get judged on what car you drive by people who "own" a car that doesn't actually belong to them, it belongs to the finance company, its pretty ridiculous.

That's a reflection of your friend's values and perspectives not the validity of asset based financing in the consumer automotive sector surely ?

One I suppose enables the other but he'd still be inducing squirms if he'd paid for the car in cash by the sounds of it.

Edited by anonymous-user on Sunday 23 October 13:52

[NickCQ]

twoblacklines said:

That accurately sums up my situation, yes.

Though more on the flipside that people who own "sheds" are being sneered at by people who think they are big because they can "own" a status symbol that they can't afford to go out and buy.

That's definitely the case on PH - posters seem to assume that everyone drives the most expensive car that they could possibly afford to buy!