£1500-2000 PCM
Discussion
I want to avoid detailing my financial circumstances because the maths works out, and therefore, it’s a “yes” I can afford it, but I’m hoping for a sense of balance in case I’m just being a bit daft.
I’m looking at two-seaters or 2+2 between £80-90k, with a £50k deposit and a term of 24 months; this helps reduce the silly amount of interest I’d be repaying.
Assumptions are the mortgage is paid off already; pension contributions are healthy, and no debt.
So, if this were you, how much disposable income would you want each month before you justified this amount on finance repayments?
I’m looking at two-seaters or 2+2 between £80-90k, with a £50k deposit and a term of 24 months; this helps reduce the silly amount of interest I’d be repaying.
Assumptions are the mortgage is paid off already; pension contributions are healthy, and no debt.
So, if this were you, how much disposable income would you want each month before you justified this amount on finance repayments?
It's all about perspective and your standard of living.
£2k a month is my total income after tax and we live okay on that as a family of 3.
I just looked at Tesco bank loan calculator and you can get £35k over 24 months at £1577 a month. The APR is 7.9 and total repayment just over £37k. So a couple of grand interest is neither here nor there.
Only you know what you can afford. If you're happy with that cost of borrowing just do it. However, if I had £50k deposit I'm sure I could buy a nice car with that alone. And if you spend £85k on a new car it's likely to be worth £50k in a years time and you'll still be paying the loan.
I think a better question here is what kind of cars you'd be looking at in your price bracket.
£2k a month is my total income after tax and we live okay on that as a family of 3.
I just looked at Tesco bank loan calculator and you can get £35k over 24 months at £1577 a month. The APR is 7.9 and total repayment just over £37k. So a couple of grand interest is neither here nor there.
Only you know what you can afford. If you're happy with that cost of borrowing just do it. However, if I had £50k deposit I'm sure I could buy a nice car with that alone. And if you spend £85k on a new car it's likely to be worth £50k in a years time and you'll still be paying the loan.
I think a better question here is what kind of cars you'd be looking at in your price bracket.
Perhaps a better approach to this would be to identify the car of your dreams then ask a specialist broker how it can happen.
Rob Flintan (Supercar Finance) has helped me obtain some fabulous cars for a surprisingly affordable amount - no name dropping!
Optimising the term and utilising a lender that gives a large balloon can make magic happen, far beyond what would otherwise be achievable
Rob Flintan (Supercar Finance) has helped me obtain some fabulous cars for a surprisingly affordable amount - no name dropping!
Optimising the term and utilising a lender that gives a large balloon can make magic happen, far beyond what would otherwise be achievable
3xAAA said:
So, if this were you, how much disposable income would you want each month before you justified this amount on finance repayments?
I'll give you a straight answer - there's no right answer, this is just my personal view.What matters is the cost of depreciation over the expected period you'll have it; the deposit / monthly is just how you're choosing to fund a car at this value.
I'd want to be saving more than the car is costing so that you continue to strengthen your financial position and have the car to enjoy. In other words, I'd want the cost of owning the car to be less than half what I could otherwise save. (I don't count day-to-day running costs in this as they're part of normal monthly expenses and don't typically come from savings).
Thank you to the sensible posters.
It may not have been obvious from my original post, but I have never bought a car on finance, hence the seemingly elementary question. I also keep my cars for about 5-8 years, so I want to own them outright and avoid any balloon payments at the end.
Buying a car for £50k cash is good advice, and that is ordinarily what I do, but this time I am looking for something a bit more special. A McLaren or Ferrari that was £160k 5-7 years ago, and has now depreciated by half.
Being able to save more than the car is costing is the kind of rule I need to justify to myself that I’m not making an absolutely terrible decision.
In my case, after all my direct debits, pension contributions, food bills, etc., are paid for, I have a disposable income of £ 4,200 a month. Minus £1,750 would leave me with £2,450 for running costs, night outs, holidays etc.
I don’t think that is a terrible position to be in? It’s not like I am on the hedonic treadmill and switch cars every 12 months, and with the cost of new cars and everything going electric, this could be the last/best car I own.
It may not have been obvious from my original post, but I have never bought a car on finance, hence the seemingly elementary question. I also keep my cars for about 5-8 years, so I want to own them outright and avoid any balloon payments at the end.
Buying a car for £50k cash is good advice, and that is ordinarily what I do, but this time I am looking for something a bit more special. A McLaren or Ferrari that was £160k 5-7 years ago, and has now depreciated by half.
BlueJ said:
I'll give you a straight answer - there's no right answer, this is just my personal view.
What matters is the cost of depreciation over the expected period you'll have it; the deposit / monthly is just how you're choosing to fund a car at this value.
I'd want to be saving more than the car is costing so that you continue to strengthen your financial position and have the car to enjoy. In other words, I'd want the cost of owning the car to be less than half what I could otherwise save. (I don't count day-to-day running costs in this as they're part of normal monthly expenses and don't typically come from savings).
This was the nuanced point of view I was looking for, thank you!What matters is the cost of depreciation over the expected period you'll have it; the deposit / monthly is just how you're choosing to fund a car at this value.
I'd want to be saving more than the car is costing so that you continue to strengthen your financial position and have the car to enjoy. In other words, I'd want the cost of owning the car to be less than half what I could otherwise save. (I don't count day-to-day running costs in this as they're part of normal monthly expenses and don't typically come from savings).
Being able to save more than the car is costing is the kind of rule I need to justify to myself that I’m not making an absolutely terrible decision.
In my case, after all my direct debits, pension contributions, food bills, etc., are paid for, I have a disposable income of £ 4,200 a month. Minus £1,750 would leave me with £2,450 for running costs, night outs, holidays etc.
I don’t think that is a terrible position to be in? It’s not like I am on the hedonic treadmill and switch cars every 12 months, and with the cost of new cars and everything going electric, this could be the last/best car I own.
ChrisH72 said:
It's all about perspective and your standard of living.
£2k a month is my total income after tax and we live okay on that as a family of 3.
I just looked at Tesco bank loan calculator and you can get £35k over 24 months at £1577 a month. The APR is 7.9 and total repayment just over £37k. So a couple of grand interest is neither here nor there.
Only you know what you can afford. If you're happy with that cost of borrowing just do it. However, if I had £50k deposit I'm sure I could buy a nice car with that alone. And if you spend £85k on a new car it's likely to be worth £50k in a years time and you'll still be paying the loan.
I think a better question here is what kind of cars you'd be looking at in your price bracket.
This!£2k a month is my total income after tax and we live okay on that as a family of 3.
I just looked at Tesco bank loan calculator and you can get £35k over 24 months at £1577 a month. The APR is 7.9 and total repayment just over £37k. So a couple of grand interest is neither here nor there.
Only you know what you can afford. If you're happy with that cost of borrowing just do it. However, if I had £50k deposit I'm sure I could buy a nice car with that alone. And if you spend £85k on a new car it's likely to be worth £50k in a years time and you'll still be paying the loan.
I think a better question here is what kind of cars you'd be looking at in your price bracket.
Worst case scenario everything turns to crap personal finance wise, flog the 85k car less depreciation, pay off the loan and you'll still have a fair chunk of cash to lick your wounds with.
I admit I admire your bravery in asking OP; having put in some financial hard yards over the last few years (big pension contributions, having to pay nursery fees etc), I'm getting to a position where I'm thinking about indulging in something like a 911 Turbo. While from a pure mathematical perspective it's clear that I could afford it - as the payments would effectively be replacing payments I'd been making on the aforementioned things without too much bother - I do still worry about whether it's 'sensible', and I am curious/nosy about the financial situation of others who are rolling around in similar cars. However I'm not brave enough to ask as I know I'll just get comments along the lines of 'why do you care what others do, only you can answer this question' (yeah I know, like I said I'm just curious), or 'ooh hark at billy big b
ks, only asking because he wants to show off' (no, like I said I've just put in some hard yards and am now getting a bit of pay-off for it), or 'you should just get [insert car I don't want] and save the rest'.
For me the answer would be roughly the same again, i.e. I'd want total disposable income of roughly double what I was laying out on the car, but I'd want the car covered by a manufacturer warranty for a couple of years to protect against big expenses.
ks, only asking because he wants to show off' (no, like I said I've just put in some hard yards and am now getting a bit of pay-off for it), or 'you should just get [insert car I don't want] and save the rest'. For me the answer would be roughly the same again, i.e. I'd want total disposable income of roughly double what I was laying out on the car, but I'd want the car covered by a manufacturer warranty for a couple of years to protect against big expenses.
It does seem like the kind of cars you're thinking about are tanking at the moment. Would it make sense to hold off for maybe 6 months and see how you go putting that £2k a month aside for the purchase? In 6 months time those cars might have lost another £20k and you'll have an extra £10 cash to go towards it.
Either way it sounds like you've worked hard to put yourself in a decent position so if you want to treat yourself then go for it.
Either way it sounds like you've worked hard to put yourself in a decent position so if you want to treat yourself then go for it.
ChrisH72 said:
It does seem like the kind of cars you're thinking about are tanking at the moment. Would it make sense to hold off for maybe 6 months and see how you go putting that £2k a month aside for the purchase? In 6 months time those cars might have lost another £20k and you'll have an extra £10 cash to go towards it.
Either way, it sounds like you've worked hard to put yourself in a decent position, so if you want to treat yourself, then go for it.
I think they will certainly keep depreciating until spring, albeit not by £20k. Either way, it sounds like you've worked hard to put yourself in a decent position, so if you want to treat yourself, then go for it.
Timing the market could be tedious though, I just need to make sure I get a fair deal on whatever I buy when I buy it.
Roger Irrelevant said:
I admit I admire your bravery in asking OP; having put in some financial hard yards over the last few years (big pension contributions, having to pay nursery fees etc), I'm getting to a position where I'm thinking about indulging in something like a 911 Turbo. While from a pure mathematical perspective it's clear that I could afford it - as the payments would effectively be replacing payments I'd been making on the aforementioned things without too much bother - I do still worry about whether it's 'sensible', and I am curious/nosy about the financial situation of others who are rolling around in similar cars. However I'm not brave enough to ask as I know I'll just get comments along the lines of 'why do you care what others do, only you can answer this question' (yeah I know, like I said I'm just curious), or 'ooh hark at billy big bks, only asking because he wants to show off' (no, like I said I've just put in some hard yards and am now getting a bit of pay-off for it), or 'you should just get [insert car I don't want] and save the rest'.
For me the answer would be roughly the same again, i.e. I'd want total disposable income of roughly double what I was laying out on the car, but I'd want the car covered by a manufacturer warranty for a couple of years to protect against big expenses.
Cheers. There's been a few stupid replies, but I appreciate the legitimate points of view I have received so far.ks, only asking because he wants to show off' (no, like I said I've just put in some hard yards and am now getting a bit of pay-off for it), or 'you should just get [insert car I don't want] and save the rest'. For me the answer would be roughly the same again, i.e. I'd want total disposable income of roughly double what I was laying out on the car, but I'd want the car covered by a manufacturer warranty for a couple of years to protect against big expenses.
And yes, whatever I buy will have a manufacturer warranty or an extended warranty by the manufacturer.
CG2020UK said:
I’d imagine with your budget and deposit you should be able to get a year or two old Ferrari Roma
Admittedly I’m well out of my depth here with these sort of cars
Just Googled them; I didn't even know they existed - I'm about £100k short! Nice idea though Admittedly I’m well out of my depth here with these sort of cars
MitchT said:
If that were my situation I'd remortgage and use that to pay for it. You'll get a great interest rate if your LTV is low, which I guess it will be - a much lower rate than a personal/car loan.
Interesting idea, though I'm not sure I fancy swapping unsecured debt vs secured debt is the best idea, and any setup fees may cost more than the £2k in interest I may end up paying with a bank loan.I hope we are all car enthusiasts on here and so we all know what we like and possibly do the man maths to see how we get what we want when we feel we've deserved something nice. It sounds like what you are looking for will be eminently affordable for you and so It is really only a decision you can make.
However, I agree with the comments on where prices are going down is it a wise time to dive in now or wait to see what transpires until early spring maybe. There does seem a downward pressure on a lot of prestige metal and expectations are that savings for that special car will materialise sooner than later.
However, it's ages and stages and if it were me I would be looking at how much I could afford to pay/lose and be comfortable with that decision.
Just my two pennyworth.
However, I agree with the comments on where prices are going down is it a wise time to dive in now or wait to see what transpires until early spring maybe. There does seem a downward pressure on a lot of prestige metal and expectations are that savings for that special car will materialise sooner than later.
However, it's ages and stages and if it were me I would be looking at how much I could afford to pay/lose and be comfortable with that decision.
Just my two pennyworth.
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