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Can you buy your current Merc off the company? - you know and like it
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I could lease....
Maybe my ignorance is showing, not having had to worry about car ownership for so long. But I assumed that if I spent £25k on a car now, sold it in 3 years for, say £15k, borrowed some MORE money to finance a purchase at £30k, then in a few changes I might have worked my way up to a 911 by the time the kids have left home, one that I actually own!
Do you think leasing is a better option than looking at long term ownership?
Thanks!
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3.2 Phaeton.
If you spend £25k now, I'd be surprised if you got as much as £15 for it in three years' time. I know most people don't think this way, but I'd plan on keeping it for a lot longer than that.
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I would say that if you are trying to save up for something then you are doing two things wrong.
1 - borrowing money to fund a depreciating asset.
2 - changing cars every three years which will cost you a few k.
If what you want is a porsche then how about £15K on the porsche and £6-8K on a big estate.
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OK, but doesn't everyone borrow money to buy a car? I will have to look at rates of depreciation, but I had assumed that borrowing money every 3-4 years was the way most people funded a new car (and maybe that the rate of borrowing was higher than the rate of depreciation?).
Would I be better borrowing more for a newer car and keeping it longer, or starting off with a cheaper car and borrowing less? I could consider either option, but ultimately I would like to feel I'm moving up the car ownership ladder rather than treading water.....
The estate and the porsche sound tempting!
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You'd be better off buying a cheaper car and keeping it longer!
You've got to trade off your aspiration to 'move up the car ownership ladder' against how much you are prepared to borrow in order to do that (and what else you / your family might want to do with that money).
This site is littered with threads with people having horror stories with newish cars, and others having years of sterling service from old cars that have cost next to nothing to maintain. One of the car magazines (can't remember which) has depreciation tables for all new cars; as one of the other posters has stated, 25k will probably be less than 15k in three years, unless it was very expensive at the point of initial purchase (if that makes sense?!)
I do just over 10k a year, and have a Porsche 968 - no company car scheme to worry about, so bought with head and heart. My wife has the family estate for the three kids, and we share the Porsche at weekends. Hopefully, low depreciation (as it is already ten years old), but the potential to kick you in the teeth with a fierce bill. However, in ten months, only expense has been new tyres, and some indicator covers. First service next week, though.
Do the sums, work out what else you could do with the money, and then trade off the cost against how much pleasure you'll get from owning a car nearer the top of the ownership ladder.
From observing this site for years now, it is clear that one size doesn't fit all, which makes it such good value
Jon
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"OK, but doesn't everyone borrow money to buy a car?"
Well, I dont. Other than once we had a years 0% so the money went in high interest while it waited to go to the dealer.
Depends what you want I suppose. How important is having a new prestige car ?
In your position I would have a good look at the costs. Depreciation is higher than most people realise, and mercs are not immune anymore - not with the corrosion problems and the issues with the diesels. Then look at what finance actually costs. ignore the quoted rates and apr's - look at the total cost to pay against what you get. I couldnt stand the idea of giving away that sort of money.
I would ask how much you could afford cash/real money and see what you could get for that. Large cars depreciate quickly, especially if they have high miles on them. If you dont do lage mileages then I would skip the diesels. then keep the car for longer. Open an account and consider it the 'porsche account' Put in every month the amount that you would have spent on finance.
If you want a large saloon I would look at slightly older A8's. less common than the merc/bmw, but still considered a quality car. Big engines can be better than small ones for economy reliability and performance, plus they depreciate more so are cheaper. Slap a private plate on if you want?
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I would have a lovely Mercedes S430 for this money.
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I would have a lovely Mercedes S430 for this money.
I actually had a quick look at a 4 year old S430 when I dropped my car off for a service earlier in the week. It was about £26k and looked immaculate. I am very tempted, but was anxious about the cost of running a 4 litre car.
Any insights?
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The fuel tank is 23 gallons. Manufacturers aim for 350-450 miles between fill ups and fit a tank to suit this consumption - so you are looking at 15-20 mpg.
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The fuel tank is 23 gallons. Manufacturers aim for 350-450 miles between fill ups and fit a tank to suit this consumption - so you are looking at 15-20 mpg.
Ouch! I think I'll look out for a S320D, which might be a little less thirsty, albeit for a little less power. I've got the 320 engine in my E class and it goes very well indeed. In fact, I should probably slow down a bit......
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I think I'll look out for a S320D
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autotrader search (on the left hand side column here) brings up a few 2003 s320d under your budget.
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I had an S350L as a hire car some time ago (best upgrade ever!). The L version is truly enormous and it was fitted with every conceivable extra including air conditioned seats, keyless go, distronic, double glazing, servo doors and so on. I had it for 2 weeks and averaged around 14l/100km (20mpg) in a mixture of city driving and foot-to-the-floor autobahn blasts, which I didn't think was too bad. The worst thing about it was having to give it back. The S-Class is a really awesome car to drive and after driving one even an E-Class feels downmarket.
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Everyone keeps banging on about depreciation. What about buying something because you want it and will enjoy it, not based on what it may or may not be worth a few years down the road.
Do you check what your fridge/freezer will be worth 5 years from first purchase?, what about that new telly?.
I find it shocking how many people will think nothing of spending thousands on a 2 week holiday that will be worth, well, sweet FA after the two weeks is up yet will moan about their car not being worth as much when they are done with it.
Doesn't anyone buy cars because they enjoy them, or are they just seen as a necessary commodity?.
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What about buying something because you want it and will enjoy it, not based on what it may or may not be worth a few years down the road.
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trancer - i agree. personally, i always assume that the car will be worth nothing to anyone else but me. if steve assumes the same, i.e. that the £25k will be wiped out in 3 years, and buys on that basis, he can't go wrong. how he funds or affords the 25k ( + interest charges ) is another subject altogether. (has to do with psychology of live-for-today or plan for your retirement-pension ).
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Thank you thank you thank you!
I derive huge pleasure from getting in my E class. Every time I have to drive somewhere, it's a real treat. If I didn't feel like that, I would have gone for a Passat or Vectra and saved all that company car tax I pay for running a bigger car. I've had the E class for nearly 3 years and wouldn't swap the pleasure of driving it every day for the thousands I've had to pay in tax (gulp!).
So I'm completely with you on this point! Maybe I should go back and look at the S class again. Unless anyone things the XJ is a better bet? I've never had a Jag.....
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My Mother-in-Law has a year 2000 E320CDi auto elegance for sale. Its only done 10,000miles. She wants £10,000 for it.
Could be the car for you.
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Espada III - well if you have a family and need a Lamborghini, what else do you drive?
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Er....it could be....but probably isn't! Thanks for the offer though, surely a bargain for someone out there?! I shall nurse my £25k a while longer and relish my options (how about an XK and a 10 year old Mondeo estate?)
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For a lot of people, the value of their car two or three years down the line is a significant issue. The comparison with consumer white goods is hardly relevant given their modest cost compared to a car.
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Espada III
Isn't that the MB with terminal undiagnosed "losing-power" sickness, away from which your MIL wants to be as soon as possible?
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...Do you check what your fridge/freezer will be worth 5 years from first purchase?, what about that new telly?...
My car cost more than my freezer (just)....
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My car cost more than my freezer (just)....
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well your decisons might be based on depreciation very high on the agenda.
but my choice of car is made assuming that depreciation will be 100%, i.e. it is the last thing i worry about. deprefciation is largely a matter for the market, and nothing you can do about it. by the time you come to sell your car, all your initial assumptions may not apply. ask any rover owner who bought 3 years ago, they may think they may just as well have bought a freezer.
and if after 3 years i find that i can sell it on for a few quid, i am well satisfied.
freedom. use your money as you like.
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>Do you check what your fridge/freezer will be worth 5 years from first purchase?, what about that new telly?...
>My car cost more than my freezer (just)....
My current car cost, 405 TD est £620 less than my freezer, Leibherr GS5203 £749 - but the freezer is almost as big as the car.
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First thing I'd do would be get a price for the Merc you have.
It's possible the company will want silly money for it (high or low) and only after you have that figure should you look at any alternatives unless there is something you want your car to do that the Merc doesn't.
If you can get the Merc for say, £16k, I'd buy it, run it for another 2 1/2 years, sell for £10k and use the initial £9k saving as a deposit for the 911 fund.
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Daglish, my Barchetta was 2.5k, my Astra 2.4k. Depreciation therefore is not high on my list of priorities. Reliability (the Astra) and fun (the Barchie) were.
Running cheap cars now means that our next purchase will be probably much pricier - we´re going through our Bangernomics phase now, kind of.
Likely depreciation will be a factor in our next purchase, and for the OP putting 25k into 4 wheels it should play a part in the decision - it would for me!
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I could lease.... Maybe my ignorance is showing, not having had to worry about car ownership for so long. But I assumed that if I spent £25k on a car now, sold it in 3 years for, say £15k, borrowed some MORE money to finance a purchase at £30k, then in a few changes I might have worked my way up to a 911 by the time the kids have left home, one that I actually own!
Steve, every time you buy a car, you are going to lose part of its value in depreciation. In general, the more you spend, the more you'll lose.
So if you want to treat yoyrself to a special car down the road, the most effective way to get there is to buy a cheap car each time, and put some money aside towards your dream car. Put £1000 in a high-interst account, and you'll probably have £1100 after three years. Put it in a car, and you'd be very lucky to get £500 back after three years.
Of course, if you want to move upmarket in steps, that's a perfectly reasonable decision ... but don't kid yourself that it is getting you to your dream car as quickly as a savings account would.
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