I’m in my mid-twenties, have a decent wage and am pretty sensible with my money, yet since passing my driving test 10 years ago, when I didn’t even have a job, I haven’t ever felt an increase in purchase power when it comes to what car I drive, in fact it’s probably gone the other way as I got a lot of help from my parents with my first car.
Nevertheless I have sat and watched as my mates who are in similar financial positions to me are driving around in brand new Volkswagens, Jags and Audis. My best mate got an Audi TT business car leasing deal with his new job which I could stomach, fair play to him. He admitted he wouldn’t be able to afford it it if it was a personal car lease Audi TT.
But my other mate is driving around in a brand new Mercedes Benz A Class, that he has got on a personal lease. Now when he mentioned this in the past I always just thought he was a materialistic fool who was throwing money away and putting himself in an awful position just so he could show off. Sound jealous? Well I was. Anyway I was chatting to him the other day about it and he maintains that he hasn’t had to change his lifestyle much if at all to accommodate the monthly payments, and to be fair to him it sounded like it was adding up. He said he was originally looking to get finance on a used A Class from 2014 worth £13,980, that would have ended up costing him £333.38 a month for 4 years. That means he will have spent £16,002 on the car by the end of the contract, to own a car that will be worth under 10k by the end of the 4 year contract. Ultimately then he would probably have spent somewhere between £6000 and £8000 over the course of the 4 year period. Alternatively he could drive a brand new Mercedes A Class for £261 per month (after an initial payment of £559) via a Mercedes Benz A Class contract hire deal meaning he would have to spend £12,826 for the luxury of driving a brand new £28,000 car for 4 years. So the decision comes to this, £7K (give or take) to drive a 3 year old Mercedes Benz A Class for 4 years or £12826 to drive a brand new A Class for 4 years.
Obviously it depends on what you need your car for, but in my mates case, he just wanted the best car he could have for the money he could afford, and he would rather drive a brand new Mercedes A Class than a 3 year old Mercedes A Class despite the £5000 saving (over the course of 4 years). I agreed and now we both have a personal contract hire Mercedes A Class on the drive!