New car time - EV PCP deals?

Journey said:
Are you worried more about the monthlies than the residual value at the end? What is your priority?
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I don't know in honesty, I'm a little overwhelmed. I'm not good with money really, but an immediate thought is the idea of spending £450 to run a car that doesn't tick all my boxes is quite daunting. But I keep having to kick to remind myself that I've been in a dream world running a model 3 for such relatively little money the past 2 1/2 years. Having heard that used car prices were high but not really paying much attention has kind of caught me off guard. I'm honestly a bit scared of dumping a chunk of my savings into a car, but I know that one way or another, I'm going to have to pay £350-£400 on average, one way or another, to run a car.

I'm struggling to understand the balance. I keep bouncing between the ideas of a new (in stock) PCP/PCH deal at the value of £30k, or just buying a crappy car. Problem is, crappy cars are crappy prices. I've seen Fabias with 100k+ miles for sale for £10k. It's bonkers.

In the past and growing up, I've always wanted THAT car. Now, I know what car I want, but there's no chance I can afford it. I need to spend the same money but one something far less attractive or not what I want. I know, I know, adulting. I just want to get the right balance on value. The Kona looks decent and I'm hoping it means I can trade performance for comfort and efficiency. But.. it's a manual. I've gotten used to autos and would prefer to stay with that if possible.

Part of me is actually regretting this job move. Had I know how much stress I'd put on myself trying to source a car (and some other news I heard at work) I might not have taken it. It's going to cost me £900 just to return the car early...
 
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[TW]Fox said:
But which one would cost you less overall? This is what matters.
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Exactly mate. Which is why I was looking at the MG ZS EV at £33k, but you seemed to think it was a horrific idea, and I'm at the mercy of the advice of members like yourself. Pay more for the car and save on fuel, or pay less and hope fuel doesn't keep rising at the crazy rate it has been?
 
dLockers said:
New MG ZS is only £359/mo with £6k down - that's only £24k/4 years or £6k/year. Not sure what folk are expecting for a brand new £34k car. I think @Journey has already done the maths on the net saving - - but price in your flexibility, I think you said 4 years is a long time and you'd be itching to change.

It is also a Chinesium car, so not sure how the interior will feel. Probably not far off your Tesla but with way less toys I imagine :p

The thing is, 10k miles isn't really that much - a decent Ford Focus will give you 52mpg (list) and can be had for a much lower cost.
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Yeah that's it, I don't drive much, and that's a risk with PCP/PCH... I do not know what mileage I'll be doing in the new job. About 1/3 of the commute there and back, but I may be driving between sites a lot more.
 
Right, quick pause on everything. Just want to say thanks for the help and apologies for my uselessness. I'm really anxious stressy person and I grossly overthink things or fear making the wrong choice. Cais la vie and all that, but it's a flaw of mine I'm working on.

I realise we're going round in circles and probably irritating the **** out of you all, but this stuff confuses me and I just want to make sure I make the right financial choice for the short term and the long term. I keep bouncing between what's best. I'm led to believe my new employer has a 45p per mile travel allowance, but as yet I've not received my contract or details so I want to make sure it's not one of those "minimum 40 mile journey" minimum, otherwise work miles might rack up, pushing up mileage allowances and/or fuel costs. I'm sort of stuck in a catch 22 situation by not knowing these in advance, so I'm finding it particularly difficult to make an educated decision on which route to go. If I buy into a PCP deal now, and job doesn't work out, I'm screwed. If I don't and wait until my job changes, my credit rating might have changed making a PCP or lease etc no longer feasilble.
 
[TW]Fox said:
It's the virtually nil company car tax on electric vehicles which has allowed it, these schemes are available to private sector employers as well.

The system was originally designed so that your income tax was replaced with company car tax, which gave people an incentive to pick more efficient cars but without reducing the overall tax take significantly. If they picked a Range Rover they'd pay absolutely loads of tax, if they picked an efficient car they'd pay similar or perhaps make a small tax saving, pushing them towards a more efficient car.

Then it was decided to have the rate on zero emissions car set to virtually zero. So lets consider the effect of this and imagine you earn £60,000 a year and are deciding between a BMW 430i or a BMW i4 40e. I pick this model because they are basically the same car, only one is full EV and one is petrol.

So, you save tax at 40% and NI on the monthly cost of the lease, and this is replaced by company car tax instead. For the example above, the monthly tax due on each car would be:

BMW i4: £36.58
BMW 430i: £572.66
1 litre Ford Focus: £266

Clearly if you take the i4 then the huge saving in tax and national insurance is not being replaced by any meaningful company car tax. This therefore makes the cost of the i4 exceptionally cheap given its a £55,000 car and also reduces the governments tax take by hundreds of pounds a month. Who is paying for this? If you took the 430i instead - a 2 litre petrol so hardly a V8 Range Rover - the tax bill is so huge that I'd imagine absolutely nobody picks one of these anymore.

So you end up with people thinking its totally normal to drive £55k cars for £500 a month (Whilst not realising or not caring that it also reduces your pensionable pay as well), when it isn't and it surely cannot last for ever.

And where is the lost tax revenue coming from?
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I assume I'm included in that list, so I'll give my opinion. You're very correct, and I'm well aware of how lucky I got my deal from and understand that it was also reducing my pension. With access to that scheme, why would I not take advantage? We pay crazy amounts of tax on everything, so I'm going to feel guilty for getting a benefit on 0% BIK for a couple of years.

EDITED: tone came across wrong
 
[TW]Fox said:
I think you missed my point a bit - it was about how the system works, not the choices individuals make :)
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But you're right; the tax has to be replaced somewhere, but my point is that we're taxed to death as it is, so I'll personally take the rare opportunity to drive a really nice car for relatively little money. Running a car full stop is becoming scary expensive back in the real world that I've come crashing back into :(
 
Kenai said:
If you were lining up for a mortgage maybe, I wouldn't get overly concerned that a new job is going to hamper your ability to PCP a car.

Echoing some comments above though, it is probably prudent to get settled and understand the requirements of the new job before diving into an ongoing financial commitment.

If you were to buy a £10k car now, with a view to moving it on in 6 months, you'd be unlikely to lose fortunes if you buy sensibly and you can go into the process of buying something nicer with more confidence your £300 / £400 per month is going on the right car. Or you might find you're actually happy with your £10k car and save some money in the long run.
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The concern with that then is warranty and parts starting to fail.

Even 10k is starting to look like 5-10 year old and 50k miles.
 
dLockers said:
At £60k salary I think people have missed the point (i.e. you should still be whacking it into your pension). Where it really makes a difference is when you hit low hundreds. For every pound over £100k, you lose 50 pence of your tax-free allowance. The effective tax rate is 60%. Now assume that the chappy/chapess has kids - as soon as you tip over £100k you lose your £2k/30hours free childcare.

It means for the effective cost for some of these EVs is 'nill' as you'd lose so much in perks and tax.

Couple that with leases being nill deposit on salary sacrifice terms and it really is even more of a no brainer.
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For me it was I earn ~£30k, and in my 30s, and I really wanted to drive a Tesla Model 3 if even for just a couple of years. There's no other way I would have ever been able to afford it without serious life changes/sacrifices, so it was 2 years of fun for me.
 
dLockers said:
I think you need to be clear with what your requirements are. Are you looking to keep your cash in the bank? Are you looking for something fancy/enjoyable/'pride' inducing to drive? Do you need to tow? Large luggage? European trips? Bad back? Driving 'up high'?

People are doing what OCUK always does and suggesting old crap because with no clear requirements, that is the right answer.
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Yep, I'm not being very helpful, because I don't really know. I've enjoyed running nice cars, probably as a pride thing as you hinted at. What I need and want are different ha.

Really, I'd like another EV if possible for the ease of home charging, but I've never had to suffer real range anxiety of the use of non tesla chargers. It's a huge plus having the Tesla network. I would like a quick car again, but a petrol option would cost stupid money again, so the only way to do so is another EV. Or, I take the opportunity to go ultra slow and boring and save money.

I don't have a huge amount in savings, but a very good house deposit should I need it (partner owns the house, I pay bills etc.). I'd like to keep most of it in tact for any huge life changes. Marriage and getting on the property ladder are life points I've yet to reach.

Basically, it needs to be reliable, comfy, bigger than a small hatchback (astra, focus etc. at least) for boot space. Towing isn't an requirement and we don't do huge trips. We are going to Cornwall from Newcastle in a month and we'll be going in the partner's Kia Piccanto, which I'm desperate to avoid haha.

Realistically, the new job will be fine, but I'm just anxious of committing (yeah, commitment is a real problem with me) to a large financial deal just as I'm leaving one employer to start another.
 
Wizzkidy said:
Hang on, you moved to a new job and lose your salary sacrifice scheme but you took a new job, didn't you get a decent pay rise when moving to a new job? Would this not outweigh the extra required for a reasonable swap of cars? Maybe not a Tesla but even so something?

Can't say I am surprised though with the current prices. I was hoping to PCP a tesla for much less then I did recently!!
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Nope, no pay rise. It's a side step really. So financially I'm worse off in the short term, but where I am is not healthy for me at times. Long story. It was a very hard choice to make, but I hope I've made the right one...
 
Wizzkidy said:
I guess it depends on the prospects at the new place but having a Tesla at 350 quid a month was a bargain, that must have been hard to give up.

Although I tend not to move jobs unless I get a pay rise. I am sure you had your reasons so I accept that. I also wanted a Tesla for a fun time at least for a couple of years, it does mean I will have to wait now for at least 2 years before we move house all because of a car I really wanted. I got major buyers remorse when I PCP'd it!
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I'll obviously not post details all over the Internet, but yeah, I weighed up a lot of options. I'm leaving a lot of good people and friends here, but the department has been without a network manager for three years and we're not being listened to - feel very much like a pawn in a system where the only ones that suffer are my team and the students. Finally had enough and a job came up nearby that's closer to home, will allow new skills, and will have career progression options. Long term potential benefits, but alas, sacrifices are to be made now.
 
Wizzkidy said:
Would the new place not consider a salary sacrifice scheme if you bought it up with them?

It's worth an ask I guess, suppose it depends on the company. I am very surprised these days most companies dont offer this already
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Already been there. I don't know details as to why not, but they don't offer it unfortunately. It would have been tremendously easier had they done so, but even if they turned round now and said "actually, it's easy, we're on it now", it's too late, as I have less than 9 months left on it now :(
 
-Ad- said:
So you haven't even started the new job yet and you're trying to lock yourself into a long term rental (PCP ;)) deal.

If so, that's a monumentally stupid idea.

Start the job, make sure you have a semi economical cheap runaround as some have recommended already.

Then see how the job goes before you tie yourself into a PCP deal where you're in heavy negative equity as soon as you get the car!
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As brutally as you've put it ( :D ), you're not wrong and it's one of the things I've been seriously thinking about.
 
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