Car or allowance - what would you take?

Beta · 8 Jul 2012 at 09:42

My girlfriend has got a new job meaning she has the choice of a car or allowance. Having only ever run a private car, we're unsure of what the 'best' option would be. Obviously, this very much depends on personal circumstances, but wondered what peoples thoughts were.

We currently have a 2007 Civic diesel which has proved to be unreliable in the 18 months we've had it needing quite a few repairs (failed wiper motors, rusting body work on the inside of the doors, sporadically working sat nav etc). Within the next 6 months, it will need a new clutch and DMF as these have a habit of eating themselves - ~£1,000 to replace.

Car allowance is £550 per month.

The car list doesn't seem too bad (with the exception it HAS to be diesel), with choices such as

BMW 125d step auto M Sport
BMW 320d Sport/Modern/Luxury
Audi A5 177 SE Technik
Audi A4 177 Black Edition
Range Rover Evoque

Theres also low spec 5 series and E classes on the list, but these are probably a little too large as she's only 4"11!

The sensible option seems to be take the money and keep the current car, fixing it as needed.

What would you do?

One · 8 Jul 2012 at 09:48

You'd be mad not to get one of the new cars surely?

Ev0 · 8 Jul 2012 at 09:53

It depends what your objective is really, is it to do it the cheapest way possible, or is it a way for you to have a 'nice' car at a lower cost to yourselves than if you were to privately fund?

I haven't explained that the best way but hope the general idea comes across!

For instance I'm still not sure what to do with my car situation, at the moment I'm taking the cash from a car allowance, but if I go with a company lease agreement I can get something nice at a cheaper rate than if I did it myself.

After the taxman has had his way when taking the cash option it pretty much halves what I see in my pocket which wouldn't get me much either on a private lease or say on loan repayments.

Now at the moment I only need a car for 2 days a week, one day to get up to work (150 miles) and the next day to get home again.

So if I was doing it purely from a cost point of view then I'd buy a banger and take the money. But it's not purely about cost, it'd be nice to get a new car that's fully insured and maintained for my monthly payments, my wife would use it for her commute the other 3 days a week and we'd have a nicer car to use.

Still can't decide though

rodenal · 8 Jul 2012 at 09:54

Car every time for me, if you dont mind buying something thats rubbish the allowance can work out but a carefully chosen company car wont cost much (certainly not compared to buying or leasing the same car yourself)

Do you own the civic? Its probably too old for the car allowance policy (check though). If you sold it for lets say 6k and that all goes in your pocket then you're laughing I reckon. Reduced take home of up to a couple of hundred is nothing compared to running a car yourself

atpbx · 8 Jul 2012 at 09:55

It depends on whether what she does actually justifies a company car or if its just a perk.
Is she going to be on the road in it most days doing hundreds of miles a week visiting sites, going to meetings etc etc?

Or is she going to do the odd visit a couple of times a month?

I could have taken a similar car allowance, but as has been said, once I'd been taxed, there wouldnt be enough left to get any thing decent for the kind of miles I do.

Beta · 8 Jul 2012 at 10:02

It's just a perk. We'd use it to drive to the station each day (roughly 4 mile round trip) and then weekend use.

She'd do the odd trip to Nottingham, anything further and she'd use the train.

Ev0 - I've looked at the cost options and the car works out approx £100 more a month than if we take the allowance and run the existing car.

Over 3 years, the difference is much larger as the existing loan on the car will be paid in 18 months, therefore, overall difference is £7,200, however, likelyhood of keeping the civic for 3 years is low as neither of us like it!

Raymond Lin · 8 Jul 2012 at 10:04

I dunno much about car allowance but that is a hell of a list from the usual i see on here!

Ev0 · 8 Jul 2012 at 10:08

Raymond Lin said:
I dunno much about car allowance but that is a hell of a list from the usual i see on here!

Car list for my place is about 6000 cars long from most manufacturers, pity it doesn't mean I can just pick any one of them

Could put some of my own cash towards something but all the 'good' stuff is hideously expensive.

Impreza, 370z etc are all about a grand a month! Want an M5, that'll be 2k a month please.

Morba · 8 Jul 2012 at 10:15

Beta said:
It's just a perk. We'd use it to drive to the station each day (roughly 4 mile round trip) and then weekend use.

She'd do the odd trip to Nottingham, anything further and she'd use the train.

Ev0 - I've looked at the cost options and the car works out approx £100 more a month than if we take the allowance and run the existing car.

Over 3 years, the difference is much larger as the existing loan on the car will be paid in 18 months, therefore, overall difference is £7,200, however, likelyhood of keeping the civic for 3 years is low as neither of us like it!

Would the train be out of her pocket or works? In our place f you have a car then choosing another form of transport (when you could still drive) wouldn't be paid for by work / expenses.

Beta · 8 Jul 2012 at 10:23

Train travel would be paid for by work for anything other than standard commuting.

We do do reasonable amounts of 'pleasure' mileage, probably in the region of 10-12k a year.

wassap · 8 Jul 2012 at 10:29

Blimey thats a corking list, my allowance is circa £550 and the Evoque and A4 BE would have cost me a fair old trade up.

As a driver the 3 series is getting rave reviews, so that would be my choice, but as a fashion car the A5 or the Evoque.

[TW]Fox · 8 Jul 2012 at 10:46

I'd have the 'base spec 5 Series' given that even the base spec is excellent and better than anything on that list.

Ev0 · 8 Jul 2012 at 10:49

Our car allowances by most standards are pretty low across the board which sucks a bit, £550 a month would be for someone on a pretty hefty salary.

Ste · 8 Jul 2012 at 10:56

£550 is a nice allowance. Is there any middle ground?

For example, I can either take an allowance in lieu of £560, or a car with a lease cost of up to £400, or a car with a lease cost of up to £400 + up to 33% (and pay the +33% myself) - or a car with a lower lease value and take the difference in cash.

If the latter is an option then a car more toward the £18-20k mark than the £30k mark will also get you a decent chunk of cash each month and you wont have to worry about tyres/servicing/tax/etc. ever again, it's a decent middle ground to sit in if you're not overly worried about what car you take.

edit - e.g. a 116d efficient dynamics @ £20k, 99g CO2 (minimal tax), 70mpg...

Rambaud · 8 Jul 2012 at 14:09

Depending on her exact circumstances, there could be a significant saving on her insurance premium with a company car?

Blackhawk47 · 8 Jul 2012 at 14:30

From that list I would take the Audi A4 black edition, purely because it adds a bit of a nice spec to it.

Not sure how the 3 series options would compare.

PMKeates · 8 Jul 2012 at 14:39

I'd take the F10 5 Series. Don't worry about it being too big - it will have great seats that will adjust perfectly, shrink around you as you get used to it, and the base spec comes with parking sensors front and rear making it easy to maneuver around. What exactly is the 5 Series option?

Bear · 8 Jul 2012 at 14:59

If it was for my misses then I'd tell her to get the Rangey, it's supposed to be a great car and with the plus point of supporting British manufacturing.

PMKeates · 8 Jul 2012 at 15:07

Bear said:
supporting British manufacturing

Didn't that previously lead to the destruction of the majority of the British motor industry?

Bear · 8 Jul 2012 at 15:36

PMKeates said:
Didn't that previously lead to the destruction of the majority of the British motor industry?

I know what you mean but it is different. It's not tax payers money and they aren't selling a load of donkey poop. JLR are selling great products and so are worth supporting, unlike days of old where it would be hard to support as they were chucking out sub standard products.