Petrol V Diesel MPG
- Thread starter MoBo
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[TW]Fox;11275408 said:
Again, this only makes sense if you then put the money away and use it only for running the car.
When you have to manage multiple budget strains (house, car, savings, etc etc) purchase price can often become far less of an issue than running costs, especially when the idea of absorbing the higher running cost through the purchase savings starts to eat into the money in your bank account, rather than lower running costs which can allow you to add to it.
Money is money, i dont understand the logic? Money out is money out, it doesnt matter when or what i spend it on or over what period of time
lol havent seen google fight for a while.
Im going home now. in my old reliable, and apparently econimical petrol car.
Night peeps
I believe the only flaw is Fox's reasoning is regarding the depreciation. His suggestion being that if you spent say £2k more on a diesel car of the same age, that none of that value would exist on resale say a couple of years later.
Unfortunately, that's not quite the case, though it's clearly somewhat more difficult to quantify.
The key pros/cons appears to be that say for myself that:
- I spend £3k a year on fuel
- An equivalent diesel seems to generally offer 50% better fuel economy, meaning that I'd save £1k/year
- The worst case scenario is a turbo failure, with a probable cost of £2k for a Bimmer
The implications being that if I hold the car for any significant period of time, that it would probably pay for itself, unless there was a turbo failure.
Of course there is then the issue of the diesel engine being a pretty horrible thing to have under the bonnet.
Unfortunately, that's not quite the case, though it's clearly somewhat more difficult to quantify.
The key pros/cons appears to be that say for myself that:
- I spend £3k a year on fuel
- An equivalent diesel seems to generally offer 50% better fuel economy, meaning that I'd save £1k/year
- The worst case scenario is a turbo failure, with a probable cost of £2k for a Bimmer
The implications being that if I hold the car for any significant period of time, that it would probably pay for itself, unless there was a turbo failure.
Of course there is then the issue of the diesel engine being a pretty horrible thing to have under the bonnet.
Soldato
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~37mpg isnt that bad then is it.
Money is money, i dont understand the logic? Money out is money out, it doesnt matter when or what i spend it on or over what period of time
It's the basic difference between up front costs and operating costs. To use the most relevant example, if I have two bank accounts, a savings and a current account, the chances are the cost of any new car is going to come from savings, but the costs of running the car will come from the current account. How much is coming out in running costs is going to impact how much I can save for the future, or remove that same amount from my savings using the "spend the difference on the running costs" logic.
There are good and bad points on both sides for which is better for individual circumstances, but that often gets overlooked by some people on here.
In this example though, if you were hard enough up to actually notice the difference in car maintenance costs between models, you could simply put the saving in a separate car account and dip into that for the difference between them. It makes absolutely no odds :/
It's not always about being hard up, it's about whether that money could be put to other uses...
The problem is both you and fox assume that a car budget is totally seperate from the rest of your budget, and in reality, it's not.
![[TW]Fox](/data/man-of-honor/2009.png){kind=avatar}
Which is prudent and sensible budgeting - after all, had you bought the diesel instead you wouldnt have this money so in theory its 'free money' over buying the diesel which more than offsets the additional fuel costs.
I am talking about putting the saving into a car account, and dipping into that for the difference in running costs over time. I dont see why it makes any odds at all. As Fox says, its free money, it wouldnt have been there, so why not stick it elsewhere and dip purely for car related bills?
In the petrol example, it's not 'free' money, it's unspent money, which is not the same thing at all. That's the problem with budgeting, it always seems easy and straightfoward when it's only a couple of responsibilities, but it rapidly grows into a complex thing that requires a lot more consideration when you have a larger number of financial responsibilities and risk factors.
I thought the same as you two once, then I had to start worrying about everything because it became my responsibility. It changes your perspective on the whole thing. It's easy when you're living with your parents, or in a cheap rented place, to see where everything goes clearly. It's a lot more complicated when you move beyond that into full home ownership, planning for the future, etc etc.
I thought the same as you two once, then I had to start worrying about everything because it became my responsibility. It changes your perspective on the whole thing. It's easy when you're living with your parents, or in a cheap rented place, to see where everything goes clearly. It's a lot more complicated when you move beyond that into full home ownership, planning for the future, etc etc.
This forum manages to get living with your parents into everything. How on earth its possibily related to chosing between diesel and petrol I simply don't know.
It's not hard Dolph, I fail to see whats difficult about spending £4k on a petrol car and transferring £1k into a savings account the next day versus spending £5k on a same age diesel car. Why does that suddenly become difficult becuase you've got a gas bill?
Jez lives on his own and hasn't lived at home for years and gets the idea.
It involves the same amount of money leaving your current account/money savings account no matter what option you pick!
I'll break it down:
You have: £5k in savings account A. You wish to buy a Car.
You can buy:
a) Diesel car A, 2004. £5k, To do this, remove £5k from savings account A. Net result: £5k leaves savings account A, 04 plate Car arrives on drive.
b) Petrol Car B, 2004. £4k. To do this, remove £5k from savings acocunt A. Give £4k to seller. Put £1k in Savings account B. Net result: £5k leaves saving account A, 04 plate car arrives on drive.
How does that suddenly become impossible simply becuase you dont live with your parents
It's not hard Dolph, I fail to see whats difficult about spending £4k on a petrol car and transferring £1k into a savings account the next day versus spending £5k on a same age diesel car. Why does that suddenly become difficult becuase you've got a gas bill?
Jez lives on his own and hasn't lived at home for years and gets the idea.
It involves the same amount of money leaving your current account/money savings account no matter what option you pick!
I'll break it down:
You have: £5k in savings account A. You wish to buy a Car.
You can buy:
a) Diesel car A, 2004. £5k, To do this, remove £5k from savings account A. Net result: £5k leaves savings account A, 04 plate Car arrives on drive.
b) Petrol Car B, 2004. £4k. To do this, remove £5k from savings acocunt A. Give £4k to seller. Put £1k in Savings account B. Net result: £5k leaves saving account A, 04 plate car arrives on drive.
How does that suddenly become impossible simply becuase you dont live with your parents
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Dolph, i would be very suprised if you had more financial commitment than me. While i am only 22, i dont need to be spoken at as if i dont know how the world works. The money in this example is dead money which wouldnt have been there. It can therefore be stashed away and dipped into at will. The only scenario where this would not work is if you didnt have enough self control not to spend it on other things.
Soldato
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£5k derv drops to £4k after a year
£4k petrol drops to £3200 after a year.
You have spent £1000 extra running the petrol over the that year and feel its time to change car.
Suddenly your £1000 'free money' means you need to find an extra £800 towards your next car, I think thats ONE of the point being raised here.
Its clear the living with parents must influence things as Id never dream of just tucking £1k away specifically for car related issues.
£4k petrol drops to £3200 after a year.
You have spent £1000 extra running the petrol over the that year and feel its time to change car.
Suddenly your £1000 'free money' means you need to find an extra £800 towards your next car, I think thats ONE of the point being raised here.
Its clear the living with parents must influence things as Id never dream of just tucking £1k away specifically for car related issues.
I am assuming you have savings though? What difference does it make where the money is? I dont have a specific car account, but i do have several savings accounts spread across a few banks which i stockpile money into which can be dipped into whenever something stings me for a few grand or whatever.
Which, if you do not intend to keep the car just a year, is not relevant. For each year you keep the car, the gap closes.
Using the example figures for the Focus earlier in this thread, in order to have spent an additional £1000 extra running the petrol car you would have needed to cover approximately 47,000 miles!
Using the example in the thread, you'd actually have expended just £300 more money assuming nothing went wrong with either car. This means you'd actually only need to find another £100 to buy another car should a) Your depreciation doomsday scenario be true and b) You decide to sell after a year.
So, a whole year in a smooth petrol - £100 more.
Thats different mindsets not different living scenarios. LOTS of people, Homeowners infact, have a car contingency fund. It's financial prudence especially if you run an expensive car. It's also a common practice after a cars warranty expires to instead of renewing, pay the cost of renewal into a savings account every year instead.
And remember, in my example, you dont need to find £1k to suddenly tuck away - you actually have £1k, SPARE, in your savings account that you'd not have had if you'd have gone for the diesel option at £5k.
If money is THAT tight, maybe you should stick with your current car or get a banger. That way, you could still stockpile £1K into a separate account to budget for repairs, but the car would have only cost you £500-1000. Net outgoings from current account- £2K. Cheaper than spending £5K on a newer car...
Soldato
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No i have ZERO savings other than £120 of premium bonds somewhere 
Indeed and none of them will be specifically a car account.
Indeed and none of them will be specifically a car account.