Time for a new car, how to go about it?
Discussion
First off this is not a question for the pros and cons of financing cars etc, God knows that's been done to death on PH. I'm just after views on my individual situation and all opinions appreciated.
I've had my car, a 2000 MK5 Fiesta Zetec S, since I turned 17 (now 21) and although I have wanted to change it at times, either the money wasn't there or I couldn't find anything that I preferred within budget. However I've now managed to land myself a graduate job with Ford, which is well paid for my age and I would now like to upgrade my car. And that's where I'm lost.
Working for Ford I obviously get discount on new cars, and so have considered getting a new Fiesta or Focus with PCP, working on the basis that the original discount I'd receive would help in terms of beating the GFV after the 2 years or however long, however I fully understand the chances of this happening are slim and so it's not a major concern. My understanding is at the end of the two years I could just hand the car back and walk away no problem, or pay the balloon payment, is this correct? The positive sides for me are obviously getting into a new car every couple of years and the low payments would be more than affordable as I have relatively low outgoings, however the choice of car is then rather limited. Of course I could get PCP on another marque, but wouldn't receive the discount (which to be honest isn't great all the time).
Of course the alternative is to save a for a few months and get something second hand, an option that holds appeal as it would give me more choice in terms of other marques etc. But it would obviously leave more cash tied up and I then have more to worry about in terms of running costs and obviously not being able to get anything for a few months.
I appreciate it all comes down to what I'm comfortable doing and I suppose this is partially where the problem lies as I have no experience of doing either. In terms of vehicle requirements, I fancy something relatively young (maybe last 3-5 years), no slouch but doesn't have to be eyeball popping performance, most likely some sort of hot-hatch to be honest.
Are there any other options I've missed? And do people have any recommendations for what I could do?
And sorry for the essay, I got a bit carried away
!
I've had my car, a 2000 MK5 Fiesta Zetec S, since I turned 17 (now 21) and although I have wanted to change it at times, either the money wasn't there or I couldn't find anything that I preferred within budget. However I've now managed to land myself a graduate job with Ford, which is well paid for my age and I would now like to upgrade my car. And that's where I'm lost.
Working for Ford I obviously get discount on new cars, and so have considered getting a new Fiesta or Focus with PCP, working on the basis that the original discount I'd receive would help in terms of beating the GFV after the 2 years or however long, however I fully understand the chances of this happening are slim and so it's not a major concern. My understanding is at the end of the two years I could just hand the car back and walk away no problem, or pay the balloon payment, is this correct? The positive sides for me are obviously getting into a new car every couple of years and the low payments would be more than affordable as I have relatively low outgoings, however the choice of car is then rather limited. Of course I could get PCP on another marque, but wouldn't receive the discount (which to be honest isn't great all the time).
Of course the alternative is to save a for a few months and get something second hand, an option that holds appeal as it would give me more choice in terms of other marques etc. But it would obviously leave more cash tied up and I then have more to worry about in terms of running costs and obviously not being able to get anything for a few months.
I appreciate it all comes down to what I'm comfortable doing and I suppose this is partially where the problem lies as I have no experience of doing either. In terms of vehicle requirements, I fancy something relatively young (maybe last 3-5 years), no slouch but doesn't have to be eyeball popping performance, most likely some sort of hot-hatch to be honest.
Are there any other options I've missed? And do people have any recommendations for what I could do?
And sorry for the essay, I got a bit carried away
!RizzoTheRat said:
You can sometimes get free insurance deals on new cars which might be worth a fair bit at your age.
Only advice I can think of is do the maths, work out how much each will cost you bearing in mind loan interest, residuals/depreciation, maintenance/servicing etc.
Well the loan rate for Ford options is about 4.9% which seems quite low to me. I think buying a new Fiesta on PCP might not be the wisest idea right now because of the New ST, I would assume residual values will be affected. I do fancy a brand new car but could get something like a 3 year old Focus ST for similar money, which would arguably offer more driving enjoyment. Hmmm decisions decisions...Only advice I can think of is do the maths, work out how much each will cost you bearing in mind loan interest, residuals/depreciation, maintenance/servicing etc.
Do you get any discount on used/demonstrators direct from ford?
My uncle worked for vauxhall and then Opel for nearly 40 years and gets access to discounted new & 2nd hand cars. This also extends to family hence why his 3 kids and their spouses all drive Vauxhalls.
Why would the new ST affect your decision re. PCP or are you wanting an new ST?
For peace of mind and knowing how much your outgoings will be for 2 years there's alot to be said for PCP. No nasty surprises, brand new car, no MOT and minimal costs.
My uncle worked for vauxhall and then Opel for nearly 40 years and gets access to discounted new & 2nd hand cars. This also extends to family hence why his 3 kids and their spouses all drive Vauxhalls.
Why would the new ST affect your decision re. PCP or are you wanting an new ST?
For peace of mind and knowing how much your outgoings will be for 2 years there's alot to be said for PCP. No nasty surprises, brand new car, no MOT and minimal costs.
GreatGranny said:
Do you get any discount on used/demonstrators direct from ford?
My uncle worked for vauxhall and then Opel for nearly 40 years and gets access to discounted new & 2nd hand cars. This also extends to family hence why his 3 kids and their spouses all drive Vauxhalls.
Why would the new ST affect your decision re. PCP or are you wanting an new ST?
For peace of mind and knowing how much your outgoings will be for 2 years there's alot to be said for PCP. No nasty surprises, brand new car, no MOT and minimal costs.
No unfortunately not, the discount only applies to brand new, unregistered cars (as far as I know). Would the new ST not affect the residual values of the current shape, as the design of the ST suggests a facelift model will be released? My uncle worked for vauxhall and then Opel for nearly 40 years and gets access to discounted new & 2nd hand cars. This also extends to family hence why his 3 kids and their spouses all drive Vauxhalls.
Why would the new ST affect your decision re. PCP or are you wanting an new ST?
For peace of mind and knowing how much your outgoings will be for 2 years there's alot to be said for PCP. No nasty surprises, brand new car, no MOT and minimal costs.
Yes, you can buy something, pay the payments for 3 years then hand it back.
Then you could buy something else with the same monthly payment.
But, don't forget about the deposit.
That's the bit that's often glossed over by the salesmen.
So, as well as the monthly payments over the 3 years, you'll also need to save up the deposit for the next car too.
All these finance deals are just ways of moving the money round.
You still have to pay sooner or later.
If you buy a 25k car and it's worth 10k in 3 years then you need to pay 15k sooner or later. There's no way round that.
Then you could buy something else with the same monthly payment.
But, don't forget about the deposit.
That's the bit that's often glossed over by the salesmen.
So, as well as the monthly payments over the 3 years, you'll also need to save up the deposit for the next car too.
All these finance deals are just ways of moving the money round.
You still have to pay sooner or later.
If you buy a 25k car and it's worth 10k in 3 years then you need to pay 15k sooner or later. There's no way round that.
ali4390 said:
No unfortunately not, the discount only applies to brand new, unregistered cars (as far as I know). Would the new ST not affect the residual values of the current shape, as the design of the ST suggests a facelift model will be released?
Don't know you've the one who works for them. 
Considering you no doubt have the obligatory student debt and this is your first job I would got for a 2 year deal using the proceeds of your current car sale to pay for the deposit on a PCP deal and the rest for a rainy day/house deposit etc..
After 2 years it doesn't matter what the residuals are as you can hand the car back and then deceide how you will finance your next purchase.
Anyway its a Fiesta I suspect they will depreciate pretty much as they all do....swiftly, especially when all the hire cars/financed cars get handed back after 2/3 years.
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