What is the best option for me, second hand or new?

[Gatsods]

Ok so I'm in my last year at University and have just accepted a job for after I've finished (bit of a result!). However it's a 66 mile round trip, and my petrol 1.6 Focus (2005 on a 54, one of the first mk.2s) returns 36mpg so it's going to go. I've done the maths and it's going to be roughly 15,500 miles of commuting every year providing I go the quickest way every day, so with social as well I'm looking at around 18,000 miles-ish I imagine a year, perhaps 20,000 absolute max but I doubt it.

I've been looking around for replacements, and obviously am thinking diesel. I haven't been in the position to finance a car before so I'm not sure what the best way for me is so thought I'd come for some advice, and as such here come the criteria...

- 55mpg+ (manufacturer's stated figure, that way I can expect high 40s at least)
- I enjoy the idea of <£30 road tax quite a lot, but not essential
- At least a remotely interesting vehicle, or if not interesting then a good suggestion (looking at you, Golf)
- 3 door hatchback or Coupe preferable, but open to 5 doors (adore the A Class Merc)
- £300/month max payment
- Deposit is fairly flexible but I don't want too much capital tied up in the vehicle
- If used, no more than 50,000 miles
- Desirable badge unless it's something really different! I know, I'm a tart..

So with all of that in mind, what can you guys come up with? I see a good post about great lease deals that are available at the moment, was just wondering what you would all suggest. I've been to see and taken out a 118d Sport 3 door hatch, which was on a 59 plate. 45,000 miles, parking sensors front and rear, upgraded stereo etc which was up for £9995, over three years on a P/H (if someone could dumb down P/H vs PCP in terms of which one suits my situation better as well that'd be handy) worked out at £11,300 including the purchase fee. Bearing in mind with £30 tax and at the claimed 62.8mpg the car would save me £1,000/year over my focus in running costs (servicing/MOT aside) it seems like a good deal.

Sorry for the essay, hope you can help!

Matt

[okie592]

This won't go well finance threads on diesels never do.

Personallly I would get something with the vw 130pd engine in it, most likey a fabia VRS or a bora until I had past probation and knew the job was a secure one.

Spend a few grand on a well speced one with lowish miles and it will run for ever.

[Gatsods]

Oh fair enough then.. hopefully people will get involved there is a lot of knowledge on here and I could use some when it comes to this finance game! It is true, I do have a 6 month probation period in the contract but realistically I don't think it'll be a problem holding onto the job. And if worst comes to worst I can just pay off the finance and sell whatever I have if it's going to cost me too much, or at least I could on something circa £10/12k. Don't think it'll come to that though.

Did think of a Fabia vRS, or even a more up to date Octavia! Ironically enough the BMW I took out was a PX at a Skoda garage so I was looking at both the other day.

[1OS]

I was pretty much in exactly your position when I finished university. I ran a VW Polo 1.9 pd130 so I will throw in another vote for that. I had a 60-70 mile commute each way and that car was great for that. Power for the motorway and cost me pennies to run, didn't finance it which helped me save money for my house deposit. And only thing that I needed to buy was tyres all round at £60odd per corner for Michelins, servicing and snazzy Bosch Aero twin wipers due to the weather last year.

[standardman]

How much debt do you currently have ? Not even graduated and you want to add to it ?

[Gatsods]

I'll leave Uni with very little debt as students go, under £10k. The way student loans are paid off it will not be a problem anyway, going to be starting in earnest come July and you don't even see it, comes off at the same time as income tax. I don't think I'd want something small again like a Polo, had a Corsa before my Focus and I wouldn't really want to go back to a car of that size, however it's another vote for the engine..

The reason I don't actually want to buy something outright is it will take the vast majority of my savings, thus robbing me of my savings, so sounds like we're in reverse positions almost. Do I let my savings depreciate by purchasing something outright and eliminate my ability to purchase property, or do I get a vehicle with a small deposit and monthly payments and look to buy-to-rent with the savings is the question ultimately I suppose and I don't really know what's the best bet as both options tie me down somewhat.

[P700DEE]

Hmmmm You want to saddle yourself with more debt and you have not even started the job ! I think you should look at your Focus as a depreciated asset and run it into the ground. The excess fuel costs will easily be out weighed by the savings in little depreciation. Run it for a year or two get secure in the job then think about getting a better car.

[Gatsods]

P700DEE said:

Hmmmm You want to saddle yourself with more debt and you have not even started the job ! I think you should look at your Focus as a depreciated asset and run it into the ground. The excess fuel costs will easily be out weighed by the savings in little depreciation. Run it for a year or two get secure in the job then think about getting a better car.

Hmm, I do like the idea of at least getting settled in the job before making the change to be fair, but at the same time I am really into my cars and wanted to treat myself a bit if possible! What you're saying about depreciated asset is pretty much spot on. Private I'd be lucky to get £1,800 for it I imagine so it doesn't have far to go at all. Makes sense I suppose ... Could just do the running it into the ground thing until the 6 month probation is passed though, right?

[Snowboy]

I don't know your field of work or your new salary, but I will say that £300 a month is actually quite a lot of money for most people in your position.

I'd suggest you get a bank grad loan for about £3.5k at about £150 a month over two years.
Get a decent used car.

Give it 6 months or a year.
See what life's like in the real world.
Get yourself settled into your working life and then look again.

[Tuvra]

Personally I would go for something like this:

With the 2.4 D5 Engine. Comfortable, Fast, Reliable, Economical & Fully Loaded.

[kambites]

So you'll be doing, what, 20k miles a year? Does your job give the possibility of a company car, if you're going down the super-efficient route you might find the BK tax is less than your income tax and hence it's cheaper to go down that route?


If you don't need the practicality, maybe something like an SLK or TT diesel?

[Gatsods]

kambites said:

So you'll be doing, what, 20k miles a year? Does your job give the possibility of a company car, if you're going down the super-efficient route you might find the BK tax is less than your income tax and hence it's cheaper to go down that route?

No there won't be the option of a company car I imagine as I'm office based so my mileage will literally be a straight commute.

I like C30's! Need to think of insurance still in terms of the D5 as I'm 20 but it's an interesting option and I guess you can get them reasonably now.

Not sure what a Bank Grad Loan is, but if I were to chop the Focus in for something else second hand I've got some extra that I could put towards that, so wouldn't be looking for a 'normal' bank loan for any reason I don't think. I do like the idea of something used and diesel though to be fair.

[simo1863]

It seems like imagine and having something fairly smart is important so I won't lecture you on how much more frugal it would be for you to run a 10 year old stbox and instead post a few links;

http://www.freedomcontracts.com/Volkswagen-Golf-2....
http://www.freedomcontracts.com/Mercedes-SLK-250-C...
http://www.freedomcontracts.com/BMW-1-Series-5Dr-1...
http://www.nationwidevehiclecontracts.co.uk/Audi_A...

You'll need to fiddle with the mileage amounts and it might discount a few.

Also, A3 seem to come out very well on PCP deals at the moment, have a play on broker4cars and see if that'll work

[The Moose]

A little word of advice - be honest with yourself.

36mpg in a petrol is currently equivalent to around 39mpg in a diesel (petrol being cheaper). So, at best, you're getting a 10mpg saving.

20k per annum is about £3,100 in petrol or £2,500 in diesel. So you'll save yourself a maximum of £600 a year on fuel. Maybe £200 on tax.

So, on £10k spend on a car, you'll take over 10 years for it to pay itself back.

I've not taken into account servicing/tyres etc as both will need them at different times.

So, going back to my first line - be honest with yourself. Are you trying to spend a st load of cash to save £800ish a year, or is it that you've just finished your degree and are pleased/proud with yourself and want to treat yourself to something shiny?

You don't have to justify it to me - this can be seen as a rhetorical question...but just be honest with yourself.

[FredClogs]

Spending £10k to save £30 or £40 a week!?

What did you study at uni? Wasn't man maths was it?

[Gatsods]

The Moose said:

A little word of advice - be honest with yourself.

36mpg in a petrol is currently equivalent to around 39mpg in a diesel (petrol being cheaper). So, at best, you're getting a 10mpg saving.

20k per annum is about £3,100 in petrol or £2,500 in diesel. So you'll save yourself a maximum of £600 a year on fuel. Maybe £200 on tax.

So, on £10k spend on a car, you'll take over 10 years for it to pay itself back.

I've not taken into account servicing/tyres etc as both will need them at different times.

So, going back to my first line - be honest with yourself. Are you trying to spend a st load of cash to save £800ish a year, or is it that you've just finished your degree and are pleased/proud with yourself and want to treat yourself to something shiny?

You don't have to justify it to me - this can be seen as a rhetorical question...but just be honest with yourself.

I want something new(er) and shiny, but I'm planning on getting something new(er) and shiny that will at least cost me less to RUN than my current car. So I get new and shiny and it costs me less annually to run, best of both worlds. But yes, absolutely I want to treat myself to something

Realistically, I want to be changing car every few years so I'm well aware it'll never pay for itself really, just like I say if I can get something nice that is also cheaper to run than my (perfectly adequate, I must say) Focus then I'd be happy to spend some money on that as I love cars! But yeah I get your point, don't worry I'm not going into this thinking I'm doing myself a favour haha :P

I'll have a look around those links, thanks, the SLK is a cool idea!

[Gatsods]

FredClogs said:

Spending £10k to save £30 or £40 a week!?

What did you study at uni? Wasn't man maths was it?

Great course, should be compulsory

[ORD]

The above post is spot on.

If you ACTUALLY want to spend less money, hold onto your perfectly adequate Ford or, if you want something nicer, buy a used car with about 60k-80k on the clock and enjoy it. It wont depreciate much if you pick correctly.

Any finance deal is just a different way of paying the depreciation (although some are, in effect, heavily discounted purchases at the front end so can be worth doing). Buying a new car is on basis very expensive relative to buying a car that has done most of its depreciation, like your Ford!

(p.s. Modern cars pretty much run forever. If your Ford is running well, it will probably (but of course not definitely) keep doing so for quite a few years, assuming it is serviced properly.)

[Snowboy]

Gatsods said:

Not sure what a Bank Grad Loan is, but if I were to chop the Focus in for something else second hand I've got some extra that I could put towards that, so wouldn't be looking for a 'normal' bank loan for any reason I don't think. I do like the idea of something used and diesel though to be fair.

Graduate loan from a bank.
I assume they are still offered.

Although, after re-reading ignore that advice.
I misread and didn't realise you already had a car.

Just keep that car for 6 months and see how life goes.

I have been in your position, and I can tell you that the difference between Uni life and working life is huge.
It's not just a case of budgeting for a semester; it's an ongoing process now.

For those first 6 months try and save £300 a month for car payments.
If you can manage it buy a new car on PCP with a big deposit.
If you can't manage it then rethink your plans.

[Rovinghawk]

Gatsods said:

I'm planning on getting something new(er) and shiny that will at least cost me less to RUN than my current car.

New & shiny or cheap to run.
Choose one or the other.

Something's cheap if you ignore depreciation. Fine, but you still have to pay it & it can easily be your biggest expense. Anything can be cheap if you ignore what it actually costs.

Also consider servicing costs & similar on your newer, shinier car.

If you want shiny then go ahead, but don't kid yourself it'll be cheaper.