Buy vs Lease?

Basher said:
What happens if your circumstances change once you've spent all that cash? How is that any different/better than financing it?
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Arguably a vehicle on finance is more flexible than buying outright because you haven't had to give away all your cash up front. So you can potentially ride out a short term problem with the savings that would overwise have been sunk into a car. Eg. say you have £30k in the bank, you can either:
a) buy a car for £30k; or
b) buy on 0% finance lets say its £6k down then 24 monthly payments of £1k.

After 3 months you lose your job, scenario a) you have zero money to cover living costs; scenario b) you've still got over £20k in the bank. Yes you'll have another £21k to pay out on finance but hopefully you'll have found another job before the money runs out.

Now it might be marginally easier to sell the car to generate funds if you own it outright but at least with the finance scenario you'll have the option not to do that and just keep paying the finance in the hope you get back into work.

Note: I'm not saying finance is best overall just specifically addressing this point about whether having finance is good/bad relative to changing circumstances - it d.
 
HangTime said:
Arguably a vehicle on finance is more flexible than buying outright because you haven't had to give away all your cash up front. So you can potentially ride out a short term problem with the savings that would overwise have been sunk into a car. Eg. say you have £30k in the bank, you can either:
a) buy a car for £30k; or
b) buy on 0% finance lets say its £6k down then 24 monthly payments of £1k.

After 3 months you lose your job, scenario a) you have zero money to cover living costs; scenario b) you've still got over £20k in the bank. Yes you'll have another £21k to pay out on finance but hopefully you'll have found another job before the money runs out.

Note: I'm not saying finance is best overall just specifically addressing this point about whether having finance is good/bad relative to changing circumstances.
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Yes exactly. That was my original point in that finance is not necessarily bad.
 
HippoTank said:
but looks like it comes down to people not having the money to buy a car, or just wanting something really new.
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Nothing like that at all in many cases. My wife earns many times more than I do but has never had the desire to own a car. She wants the latest tech and her newest car is a VW ID3 on PCH over 3 years. Her 40K car (list) costs her on a 1x35 deal at 10000 mpa £331 a month.

She can't possibly get a used electric car for that price and she is more than happy to move from one PCH to another. (She had a Karoq on PCH before this VW).

My Audi Q7 is on a PCP because it was cheaper over the three years I have it than a PCH total cost. Once again, the total cost I am paying is way less than a semi-decent used car out of warranty and with big bills on the horizon. My next car will also be on PCH and I will pay on a 1x35 PCH less than I could buy a 5 year old used version (and that would be the old model car, out of warranty and with many miles on the clock.)

Horses for course and all that but many people are completely happy with leasing a massively depreciating asset that exists in a market of ever evolving technology, especially the move to electric.
 
If you've 'only' got £30k in the bank then spending it all on a car is never a good idea. If buying the car uses up all of your savings then you can't really afford the car in the first place.
Everyone should have that rainy day fund as a minimum. I'm aware many people don't.
 
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