Petrol V Diesel MPG

[Demon]

<snip>

You are like me, I tend to focus on specific models when looking at cars, and will narrow choices down to post facelift models only etc, with a rough budget with room either side if I need to and have the luxury of being able to 'pocket' any difference for fuel if I want to, but as is usual in life, there is more then one way to 'look' at it..

The bottom line is cars are a fantastic waste of money, the depreciation/running costs are stupid, which is why people set a fixed budget and just spend it on the right mix of age/reliabilty/running costs/driving experience that suits them isn't daft in the slightest..

 

[Dolph]

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 related to budgeting, which is what this thread has rapidly come into. I tried everything I could to avoid bringing it in, but it's relevent.

What would happen if you lost your job? What problems would it cause you? How about your boiler packing up? Would that impact you, apart from being cold?

What happens to the homeowner who loses their job?

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?

You do fail to see it, because as your example shows, you don't yet understand it. It's not the gas bill that's the problem, it's the variety of different things pulling at your finances, the hundred and one things that can suddenly change that actually matter, and you actually have to deal with.

It involves the same amount of money leaving your current account/money savings account no matter what option you pick!

Of course it does, but that doesn't mean the money leaving has the same impact or effect, which is the part you are seemingly oblivious to, especially as all these small, insignificant additional expenses quickly add up. The idea of 'well it's only a fiver' is ok when added once, but if you take that attitude to everything, you'll end up spending significantly more than you have to.

What do I notice more, a one off payment of £1000 or 10 payments of £100? That depends, one is paid and forgotten, the other isn't, the other requires consideration each time. There is the flip side, of course, that you can make the 10 payments and keep the £1000 in the bank, which works better for some people, but that's another thing that I know from previous discussions you don't understand the reasoning for either.

The key factor is that budgeting is not always about how much is spent, but how it is spent, there are even situations where the more expensive option is more attractive for various reasons, so it's not even about saving money...

 

[[TW]Fox]

But the whole point is you can acheive that same mix of age/reliability/running costs by doing a few sums before you buy.

Over, say, 5 years, you'll probably find the difference in total ownership cost between 2004 diesel LX and 2004 petrol LX, allowing for cheaper purchase price of petrol but lower running costs of diesel, is about the same, with the lower purchase price of petrol allowing you to offset the higher running cost.

 

[Jez]

No i have ZERO savings other than £120 of premium bonds somewhere



Indeed and none of them will be specifically a car account.

Whats so hard to grasp though, its all money in and money out. It doesnt matter whether 1k of whatever savings account is for. I just made the car account example up as something someone could do if they didnt want the money getting "lost" elsewhere, so that they could pretend the car had actually cost as much as the diesel would have and could eat it away slowly purely on the car.

 

[Dolph]

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.

With all due respect Jez, your circumstances are not average and therefore probably aren't generalisable to the rest of the forum.

 

[[TW]Fox]

What would happen if you lost your job? What problems would it cause you? How about your boiler packing up? Would that impact you, apart from being cold?

What happens to the homeowner who loses their job?

Could you possibly explain how these relate to either scenario?

Infact curiously you'd be better off taking my petrol option as you'd have a grand in the bank you could 'steal' for other purposes to help make ends meet whilst you found a new job, whereas had you bought the diesel you'd have an empty savings account and a diesel on the drive

You do fail to see it, because as your example shows, you don't yet understand it. It's not the gas bill that's the problem, it's the variety of different things pulling at your finances, the hundred and one things that can suddenly change that actually matter, and you actually have to deal with.

So what? Again, how does this effect the example at hand? How does it mean you'd be better off with one of the options over the other? The existence of other bills in your life have no bearing on whether its best to spend £5k on a car or £4k on a car and move £1k into a savings account to run the car.

Please explain how they impact it?

which is the part you are seemingly oblivious to

I'm not oblivious to it, it just isn't relevant in this example!

 

[barnettgs]

You would be mad to buy a commonrail turbodiesel and not budget for repairs.

*Hugs his Ford Mondeo TDDI*

 

[Jez]

With all due respect Jez, your circumstances are not average and therefore probably aren't generalisable to the rest of the forum.

I dont see how my circumstances are relevent?

You have 10k to spend on a car.

Petrol car costs £8k, diesel costs £10k for the same model.

With the diesel you have the car and run it out of your current account.

With the petrol you have the car and a separate car account with £2k in it, which you dip into for the difference between the fuel bill of the diesel, and the fuel bill of the petrol. Rmember to pay back into this account whenever you save money too, as servicing petrol is generally cheaper.

Its simple, it doesnt matter if i lived with my mum or my great aunt, or whether i worked on a salary or whether i run a company. Its the same money.

 

[MrFunex]

barnet - just out of interest.. are the TDDi's notably more reliable than the TDCi's?

Oh, and I think the general idea is not to buy a car you can't afford to run and maintain. Regardless of fuel type it would be stupid to pour the absolute MAXIMUM you can afford into buying a car if the moment a small thing goes wrong with it, it's a 1.5ton paperweight sitting on your drive.

 

[Dolph]

Could you possibly explain how these relate to either scenario?

They don't relate directly, beyond the fact that these are all things that can and should impact your budgeting choices, and are factors that you like to ignore when it comes to claiming that one answer is correct for everyone.

Infact curiously you'd be better off taking my petrol option as you'd have a grand in the bank you could 'steal' for other purposes to help make ends meet whilst you found a new job, whereas had you bought the diesel you'd have an empty savings account and a diesel on the drive

Indeed, such an advantage is a consideration, apart from then you're left without the money in the bank and the increased running costs, so you've definitely saved nothing in your running budget, because your plan basically says you chip an amount from the savings to offset the higher costs, and if that money is then spent on something else, you can no longer do that (which is a big part of my point. The idea that most people can ringfence a car fund is flawed)

So what? Again, how does this effect the example at hand? How does it mean you'd be better off with one of the options over the other? The existence of other bills in your life have no bearing on whether its best to spend £5k on a car or £4k on a car and move £1k into a savings account to run the car.

See above, and you're still not understanding the difference (percieved or otherwise) between up front and rolling costs). It's mentioned in the part you snipped and didn't reply to.

I'm not oblivious to it, it just isn't relevant in this example!

It's very relevant to it, for reasons I've mentioned above. The fact that you don't see it doesn't make it irrelevant.

 

[[TW]Fox]

They don't relate directly

As I suspected then. Merely an attempt to try and remove credibility from my opinion, after all, I don't pay gas bills I can't possibly know anything about finance.

beyond the fact that these are all things that can and should impact your budgeting choices, and are factors that you like to ignore when it comes to claiming that one answer is correct for everyone.

Of course they should impact your choices but the examples in question have the same cost to you (If you count the moving of the £1k as a 'cost' which for budgeting purposes, as it wont technically be used for paying other stuff, it is). Therefore, other bills shouldnt affect the choice because the effect on your outgoings is largely unchanged - thats the point in the second option, it provides a cushion to soak up additional cost.

Indeed, such an advantage is a consideration, apart from then you're left without the money in the bank and the increased running costs, so you've definitely saved nothing in your running budget, because your plan basically says you chip an amount from the savings to offset the higher costs, and if that money is then spent on something else, you can no longer do that

But Dolph - had you bought the diesel, you'd also be unable to use the £1k.. becuase its gone! On purchasing the car!

See above, and you're still not understanding the difference (percieved or otherwise) between up front and rolling costs). It's mentioned in the part you snipped and didn't reply to.

You don't seem to appreciate how a banked lump sum saved on upfront cost can be used to fund running costs...

 

[Dolph]

I dont see how my circumstances are relevent?

They are relevant because the value of money varies quite a bit depending on how much of it you have and how much of it is spare.

£1k can be anything from pocket change that you spend in a weekend to the family income for a month. As such, the feasability of keeping that money sequestered away exclusively for the car will change.

I've been to both, from living hand to mouth working a minimum wage job to my current situation, where I am more than comfortable with a good financial backup just in case.

 

[Jez]

I mean in the example here, where the total cost is identical no matter how many times we go through it.

 

[MrFunex]

If you can't afford to spend £4K on a car and keep £1K in a separate account to fund repairs/running costs etc., how could you afford to spend £5K on the other car?

it's an outgoing of £5K either way...

 

[[TW]Fox]

If you can't afford to spend £4K on a car and keep £1K in a separate account to fund repairs/running costs etc., how could you afford to spend £5K on the other car?

it's an outgoing of £5K either way...

I knew it wasn't just me..

 

[Demon]

<snip>

your whole argument (which is correct) is based around identical trim/year models.. of which the maths is sound

To see it from the other side (which is also correct), the maths also works, you buy a year older diesel for the same 'fixed' outlay.. then you have cheaper running costs, better depreciation.. so at the end of three years, you get more back when you sell it, and have spent far less in the mean time..

Factors such as reliability don't readily factor in, since any car < 8 years/ 100K miles is deemed 'reliable' to the point it doesn't matter..

the difference is that you are saying the only comparison is identical year/trim and that only engine differs, the other side sees it not from a year/trim perspective, but from an outlay/depreciation perspective, if everything else is 'roughly equal' they both work..

There are fringe scenarios of course that breakdown on both sides, but it's the generalisation we are talking about..

And I can't help but slightly chuckle at Jez and Fox, I know you are great people, but honestly when your mortgaged up, familied up, etc, then I do hope your budgetting is as flexible as you have it now, but I can agree with Dolph in saying that for he VAST VAST VAST majority of people the situation changes rapidly when houses and family comes along.. byy eckkk, these young whippersnappers ...

 

[[TW]Fox]

your whole argument (which is correct) is based around identical trim/year models.. of which the maths is sound

To see it from the other side (which is also correct), the maths also works, you buy a year older diesel for the same 'fixed' outlay..

Or buy the year older petrol (same plate/mileage as the year older diesel youve just introduced) and again have the saving spare....

then you have cheaper running costs, better depreciation.. so at the end of three years, you get more back when you sell it, and have spent far less in the mean time..

Thing is, I can see exactly where you are coming from but each time you seem to forget that you have the option to match the year/mileage but go petrol and save. Obviously once we get down to £2k cars it stops being able to happen as the price difference between diesel and petrol is far smaller, but then thats why you wont see me saying LOL DIESEL 406 SUX get the PETROL ONE LOLZ.

the difference is that you are saying the only comparison is identical year/trim and that only engine differs, the other side sees it not from a year/trim perspective, but from an outlay/depreciation perspective, if everything else is 'roughly equal' they both work..

But unless supply on the market is tight you are always able to equalise the scenario and pick two cars of the same year..

And I can't help but slightly chuckle at Jez and Fox, I know you are great people, but honestly when your mortgaged up, familied up, etc, then I do hope your budgetting is as flexible as you have it now, but I can agree with Dolph in saying that for most people the situation changes rapidly when houses and family comes along.. byy eckkk, these young whippersnappers ...

I can't help thinking people try and use this to claim some sort of moral highground or rubbish the opinions of others. I fully appreciate the financial strain of that sort of thing and it would be a totally valid arguement if I was on here posting 'ha ha you all suck why dont you all just spend 10 grand on a 3 litre car', but of course, thats not what I am doing - I am presenting two scenarios with largely identical total costs.

I'm not completely oblivious to the comforts that not having a mortgage affords you which is why you dont see me in 'Spec me a family runabout' threads extolling the virtues of a used 540i.

And Jez has a house.

 

[barnettgs]

barnet - just out of interest.. are the TDDi's notably more reliable than the TDCi's?

TDDI is basically the same engine as TDCI but doesn't use common rail technology which is prone to fail.

TDDI is a bit more noisy and unrefined than TDCI but then it's no big deal for me. Some people could not tell the difference when on the move.

 

[Jez]

And I can't help but slightly chuckle at Jez and Fox, I know you are great people, but honestly when your mortgaged up, familied up, etc, then I do hope your budgetting is as flexible as you have it now, but I can agree with Dolph in saying that for he VAST VAST VAST majority of people the situation changes rapidly when houses and family comes along.. byy eckkk, these young whippersnappers ...

I think you need to assume less about who you are talking to and stop being so patronising. Unless you are privately running at least two business' i'd be willing to bet my financial situation is more complicated than yours. Stop talking down to people whom you have no knowledge of.

 

[Dolph]

As I suspected then. Merely an attempt to try and remove credibility from my opinion, after all, I don't pay gas bills I can't possibly know anything about finance.

Not the point I was aiming for, I'm sure you do know about finance, the problem is you seem to think that it's simple and everyone else is just doing it wrong, when the reality is that there are compromises to be made, and different people may have different priorities when it comes to managing their money. You are not wrong in what you say, apart from when you say that everyone who disagrees with you is wrong.

Of course they should impact your choices but the examples in question have the same cost to you (If you count the moving of the £1k as a 'cost' which for budgeting purposes, as it wont technically be used for paying other stuff, it is). Therefore, other bills shouldnt affect the choice because the effect on your outgoings is largely unchanged - thats the point in the second option, it provides a cushion to soak up additional cost.

As long as that cushion's available, which is the point I'm trying to make. Not everyone can keep that cushion available, and if you can't, you're in a worse position.

But Dolph - had you bought the diesel, you'd also be unable to use the £1k.. becuase its gone! On purchasing the car!

Indeed, but that's why spending everything you had would be a bad idea... You stand a better chance of paying back the £1k with the lower running costs though, whereas with the alternative you have higher monthly costs to deal with.

You don't seem to appreciate how a banked lump sum saved on upfront cost can be used to fund running costs...

I do appreciate it, I just question the practicality of it for a significant number of people. That's not the same thing.