Car allowance - lease vs buy
Discussion
Hi all,
New to the forum and first post so go easy on me 😜
I’m starting a new job in sept and will have a £400 car allowance (After tax I reckon i will only see just over £200) I’ve always had company cars so now need to decide what and how to get.
My thoughts are that if I get a loan and buy over 4 years then at the end I’ll be left with residuals in the car which is essentially free money.
Allowance scheme is pretty open with only stipulation being must have 4 doors (no mileage or age restrictions)
So my question is with a budget of £12k what would you go for - ideally nothing over 7 years old ?
Or alternatively am I being daft and should I go for a lease - if so with a budget of around £300 a month and £2.5k to put down what should I look at?
Thanks all
New to the forum and first post so go easy on me 😜
I’m starting a new job in sept and will have a £400 car allowance (After tax I reckon i will only see just over £200) I’ve always had company cars so now need to decide what and how to get.
My thoughts are that if I get a loan and buy over 4 years then at the end I’ll be left with residuals in the car which is essentially free money.
Allowance scheme is pretty open with only stipulation being must have 4 doors (no mileage or age restrictions)
So my question is with a budget of £12k what would you go for - ideally nothing over 7 years old ?
Or alternatively am I being daft and should I go for a lease - if so with a budget of around £300 a month and £2.5k to put down what should I look at?
Thanks all
Thanks for all the advice guys in answer to some of the questions
I’ll be doing around 15k miles per year
10k of these will be business miles which I can claim back at £0.15 per mile
I’d be looking to keep the car for around 3 - 4 years
No requirements on size other than having 4 doors
If I was looking to buy I’d be looking used and examples of what I’ve seen around £12k include jag xf or golf gtd
Cheers
I’ll be doing around 15k miles per year
10k of these will be business miles which I can claim back at £0.15 per mile
I’d be looking to keep the car for around 3 - 4 years
No requirements on size other than having 4 doors
If I was looking to buy I’d be looking used and examples of what I’ve seen around £12k include jag xf or golf gtd
Cheers
Just to give you my take on what I meant
Currently it is possible to get a £10k loan at 2.9% apr with monthly repayments of circa £220
Assuming I put £2k towards the car then use the car allowance to pay off the loan - at the end of the loan payments any residuals above £2k in the car will be free money as I will have recovered initial outlay and won’t have paid back any loan payments personally as they come from the allowance
Hope this makes sense
Currently it is possible to get a £10k loan at 2.9% apr with monthly repayments of circa £220
Assuming I put £2k towards the car then use the car allowance to pay off the loan - at the end of the loan payments any residuals above £2k in the car will be free money as I will have recovered initial outlay and won’t have paid back any loan payments personally as they come from the allowance
Hope this makes sense
Completely understand what your saying and agree it is part of my salary
I guess in my head I’m comparing it to a lease - for arguments sake let’s say total value of lease over 4 years is £12k at the end of this I would be left with nothing
As discussed with a purchase your left with residuals
Given I don’t have a car and have to have one and can’t really buy a banger due to miles driven and having to transport customers - it’s the comparison of the lease vs purchase that I was working through.
So given all that any thoughts on what second hand car around £12k I should be looking at?
I guess in my head I’m comparing it to a lease - for arguments sake let’s say total value of lease over 4 years is £12k at the end of this I would be left with nothing
As discussed with a purchase your left with residuals
Given I don’t have a car and have to have one and can’t really buy a banger due to miles driven and having to transport customers - it’s the comparison of the lease vs purchase that I was working through.
So given all that any thoughts on what second hand car around £12k I should be looking at?
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