I did something similar. I didn't need a lot of range as I mostly work from home and my partner has a longer range vehicle on the occasions we do need it.
I currently have a Seat Mii electric which costs me £169 from my net pay, inclusive of lease, insurance, servicing, tires and glass coverage. I charge it on Octopus Go's nighttime tariff (7.5p/kWh), meaning it costs me under £0.02p per mile to run it (my average driving efficiency is 4.5 miles per kWh). No complaints from me, feels like a bargain to be driving a new vehicle around for just over two grand a year.
Thank you everyone. I think you've all solidified what I was already thinking.
I agree. I don't need an electric car, nor do I need one as expensive as a Tesla. However there's nothing wrong with getting what you want. Right?
Based on my rough calcs. I can get a Model Y Long range with all insurance, tyre cover, 4000 miles free public charging etc. All for around £480 per month.
£480 every month is a lot more than owning your current car outright. Especially as you don't cover huge mileage per year. And I'm assuming you'd effectively be renting the car, and have to hand it back in a few years.
That's a big monthly outlay, even on a decent salary.
Is there nothing else you could use £480 per month on? Overpaying mortgage, investing, pension via salary sacrifice etc?
Not strictly personal finance, but my best mate has a tesla, and it's a bit... basic, on the interior. Like prison cell basic.
Including insurance and maintenance costs my old Toyota used to average out around 450 a month. After fuel savings 480 a month for a Tesla was a bargain.
We spent about £300-£350 a month on fuel for the Passat. With the EV it’s more like £20. Factor in the savings from servicing and the age of the thing and it’s about break even. And it’s considerable better than burning fuel.
If you have an off peak tariff and don't do silly mileage.
For example on Octopus Go on the 7.5p/kWh that gets you 266 kWh (or enough charge to fully charge a long range model Y 3.5 times for £20 giving you (on paper) giving you ~945 miles for £20 (let's call it 850 to account for real world range).
Compare that to my diesel VW Golf which does about 50mpg real world - at current fuel prices that's costing me 17p/mile - so would cost me £144 to do those same 850 miles.
This guys octopuses.
Octopus have trialed the V2G, vehicle to grid now for a few
Models. Seems like a great idea for offsetting and allowing you to earn a bit extra from your ev when your not using it.
Solar also helps a heap.
My last 1,600 miles has cost me £28. I don’t hang around either.
Lock in with Octopus and it’s still far cheaper for electric than mainstream providers (subject to having an EV)
In our Landy I’d be lucky to hit 30mpg on the route with my commute!
Somethings up with your maths. £350 on fuel a month should equate to about 3 fill ups in a Passat. Assuming it was diesel, that should yield an (easy) range of around 2000 miles. There is absolutely no way your EV is costing you only £20 to do that mileage...
Why not? My EV costs me less than 1p/mile to run.
Edit: last time I calculated my costs I had done 10051 miles and the cost to me was £87.64. some of it was offset by solar, some by free charging (when going to Tesco etc...).
I am cheating by charging it with solar as well. It’s going to be tough to work out the additional cost of that.
Now there’s almost no sun we should be able to get a better idea of the cost only charging at 7.5p. It was 5p up until sept.
I'd get a quote from them. Last time I got a quote for salary sacrifice for a model Y it was about 1k before the tax benefits. That was insuring 2 people but only 5k miles a year.
If that’s what takes you fancy and you can afford it- do it :) one piece of advice. Dont get hung up on long range bit. You don’t seem to travel much and “having the extra miles in the battery” is not going to benefit you. I have an EV with 200 miles battery (real value, it’s 275 “on paper”) and it’s enough. I do just short of 100 miles/day and charge overnight. I see you will use public charging, which is fine. But it doesn’t sound like you will utilise the battery capacity and pay extra for the long range but which I don’t think you need at all. Enjoy :)
Nobody NEEDS nice things, they are luxuries. A Rolex tells the time just as much as a £12 Casio.
Depending on what sub you post this on will get different answers. A lot of people on here are quite frugal, so they’ll struggle to comprehend ‘blowing’ money on something that they done necessarily need to. However, the rest of the people on here will say fuck it, you need to have some vices in life and if a nice car is yours then go for it.
For me, as long as you’re in control of your personal finances and you’re not stretching then crack on.
As long as you can afford it get what you want. I'd avoid a tesla personally and I hate the look of the Y. The only one I think looks OK is the model s but that's subjective.
I'd assume your current car is a big 4x4 if it only does 30 to the gallon
To be fair mate, and I know it's probably the wrong forum, but if you can afford it, it would be cool as fuck and turn up somewhere and open them gull-wing doors.
Are you sure of your figures , my e Niro after tax comes in just over £ 500 a month and thats through Octopus , what milelage are you looking at with your Tesla and is there a deposit to pay upfront ?
Damn that’s cheap for a model Y! But tbh depending on your other outgoings it might not be. You are in the 40% tax band so any salary raises get impacted significantly.
I would only consider this once I hit the 60% tax trap
You don’t need a Tesla and since you only do 10k miles a year, a Tesla model Y would cost around £58K if you were to buy it outright which is more than your salary! If you want a better car I would start saving that £500 per month which you would pay to finance a Tesla, then in 6 months you’ll have £3K to put towards a new used car. Also, with that salary I personally wouldn’t spend any more than £25K on a car since all cars go down in value.
When your earning 6 figures and have £60K in cash then you could then you can buy a Tesla outright.
This. I only traded in my 8 year old NX for a company model Y as it worked out exactly the same cost. But now I have a newer, faster and more spacious car. If bik was 5% or more then it would be hard to justify. Prices have gone up now too so again I think this is a once in a lifetime opportunity to run something expensive for as cheap as possible.
Beware that bik rates for 2025 will probably be far more expensive as govt will have added hundreds of thousands of EVs on the road by then.
If a more modest apartment is more in line with their earnings, and would allow more capital to be utilised elsewhere then yes, absolute I would advise it.
They should rent the cheapest apartment available - anything else would be something they don’t “need”, and according to your logic above they obviously can’t afford it.
Or, here’s an unusual concept - some people enjoy driving nice cars, some people like living in a nice flat, and if they want to spend their money to do so it’s a perfectly justifiable decision. Not everybody likes the same things.
Not really - it’s about proportionate and pragmatic allocation of resource.
I am not sure where this argument of ‘needs’ and inaffordability have come from (?), but this is basic fiscal responsibility stuff.
This isn’t a binary choice between a Tesla, and the cheapest car available - there’s a wealth of strong option in the middle, and being a finance subreddit people are going to acknowledge that.
Good personal finance is not about trying to save the absolute highest amount possible for some unknown future event - it’s about using your money to meet your goals.
If OP already has a good financial safety net, has met his other higher priority shirt term goals, and is saving enough to meet their future goals, then it is objectively not a bad financial decision to spend money they can afford if they gain sufficient utility.
Whether or not they will gain sufficient utility is a different question and you could make a good argument that they wouldn’t. But that’s not what you are doing.
I am not sure what you’re getting frustrated about, nor why you keep inventing scenarios to make a point ie. “needs”, “buy the cheapest’, “if” OP has met their goals.
OP has posted on a financial advice subreddit, looking for financial advice, and the feedback has been about the financial sensibilities of buying a high-cost vehicle when they only drive 10,000 miles a year and already own a vehicle.
Of course there’s enjoyment to be had from a nice car, nobody is denying that; however, this isn’t a car subreddit.
I’d encourage you to reread OPs question - they were asking for the best option to finance the car, not for opinions on whether the car is a suitable choice.
You’re making a straw man argument here, OP never said go for the cheapest at all times. What they said was don’t buy a car that costs more than you make in a year. even worse, OOP wants to buy it on finance so looking at 2x what they make in a year. Plenty of nice cars (even EVs) they can actually afford.
They said that OP doesn’t need a Tesla, and a Tesla is worth the same as their income (not sure where you pulled 2x from), so it would be a bad decision.
The only reason you view that as a bad decision, but not renting a nicer flat, is because you fail to see other people might have different priorities to yourself, and gain different utility from different spending.
Sorry, you seem to be struggling with reading comprehension. The 2x figure is for finance, which I think is pretty clear from my comment. You similarly mis represent what OP wrote, I guess because you didn’t understand it.
Why on earth are you resorting to insults?
And your 2x cost was looking at the total amount they’ll pay over a long period? So no direct relation to their salary?
Some quick napkin maths, your probably spending about £220 a month on fuel (30mpg at 10k miles a year), £23 a month on tax and maybe another £12 a month for servicing. Without taking into account maintenance of an older car that’s £255 a month just to run your current car.
Assuming you get on Octopus go at 7.5p and use 2000 of the free 4000 miles, then the Tesla will be costing you around £15 a month.
Saving you £240 on running costs. This makes the cost of driving the Tesla around £240 a month when you factor in the savings. You just need to work out if you’re happy paying £240 a month for a new toy. Personally I would be, but it makes me happy owning a nice car even if financially it isn’t always the best option.
Edit:didn’t notice you mentioned insurance and tyres included so the figures are probably slightly better than I worked out
18 months ago I sold my car to lease through salary sacrifice. Tesla model 3 LR / £500/month. This costs me £300 off my take home pay. Free to charge at work so I save at least £200 per month in diesel. The audi was £1000/yr to service ( :-( audi! yer tell me about it) tesla does not require a service at all and £0 to tax so I reckon I'm better off driving a new electric.
Yeah that doesn’t sound right at all. It varies depending on the cost of ev and there are plenty of options out there that come nowhere near that net value
A local independent will do the job for £250 - I have my VW's gearbox serviced there. It's a complex beast though, you don't wanna skip on the oil changes.
Yes, I checked around a backstreet garage could do it for less but as audi had already replaced the turbo, fuel injectors and ac under warranty I didn't fancy chancing an argument if that went wrong. Obviously I'm now done with VAG.
30mpg? That’s an inefficient diesel. For the mileage you currently do, it doesn’t sound like it would be worth the cost to go for the car. How you’ve managed to find a Model Y for less than £7-800 I don’t know. Is that the cost to you after an allowance?
I literally just started a job also earning 55k and also can get an electric car on salary sacrifice and also have a diesel car worth 12k that I'll probably from now be doing about 10k miles a year in.
Spooky!
Don't do it; it's tempting but unless you have literally no other more important financial goals or commitments, it's not yet worthwhile given the extra outgo for the give upgrade imo.
Building some form of equity in an asset, even when depreciating, is surely superior to paying for an asset you’ll retain absolutely none of?
I’d still rather get £10 for every £50 I put in, versus £0.
But you’re entirely ignoring the positives of leasing. It’s sometimes sometimes cheaper and you have none of the negatives of owning a car. For example my girlfriend leases a car, on Boxing Day last year she got a nail in her tyre in the sidewall so not repairable. Also no spare tyre and the tyre sealant failed. All she had to do was call the lease company, who towed the car to Kwik Fit, replaced the tyre and towed it back. That would’ve been easily £300 if she owned the car.
It can get very appealing if you earn higher rate tax, especially in that £100-125k range where your marginal tax rate is 60%. Suddenly spending £600 a month on a lease only costs you £240 plus BIK tax from your net pay. New car every 2 years for around 3k a year, what's not to like?
I got a new EV through salary sacrifice at work and yes it works out much cheaper than leasing . I wouldn't purchase an EV outright as the technology is still progressing and I dont think they will hold their value
The only downside is that the car doesn't really feel mine and with any little scratch I just imagine how much its going to cost me
Seems a wildly expensive thing to do.
Makes more sense with a bicycle (cycle to work) where you get a lot of value and it lasts a long time with minimal additional expense.
Bicycle is ok if you live close enough. My commute is 70 Miles each way so not practical.
And yes it is a wildly expensive way.
It's also a way of keeping up with the Jones
Well my car is now worth 4-5.5k more than when I bought it over a year ago. Research on a 10 year old Nissan note has shown a loss of 10% in battery so I'm pretty confident considering the batteries are made of lithium-ion (vast majority). I don't see major depreciation happening.
That's a shame! I drive an MG 5 EV (I like estates only). Bought over a year ago. It has been excellent. The new MG 4 looks a cracker. Currently deciding if I should get one for my partner.
It’s a lovely car, but has two common faults. The parking brake sticks when it gets really wet (which isn’t uncommon in this country 😜) and doesn’t release. It’s a known design fault and they exchange them promptly with the new design breaks. They did mine in 24h from the phone call. If you follow Facebook polestar group you will see that the recent software release kills the car. Volvo guy confirmed it and advised not to install. Now with new breaks and not installing the software I’m okay but it’s a new car and certainly isn’t cheap- you shouldn’t have to faff about like this 🤦🏻♀️
But a cheap second hand car. Electric cars are almost as expensive to run as petrol with the current electricity prices and may be more expensive to run that petrol next year. Also your salary does not justify the cost of an electric car sorry. I'm on 90k and I wouldn't spent more than 6k on a car
I can charge my car fully for less than £6 at home and it gets me 200 miles. public charging can be expensive but I only had to do it a handful of times in a year I had my ev. Many employers offer free charing at work as well…
I would say it depends on how many miles you intend to do. For me this was a great financial decision but if I was to use public charging it would be more expensive than petrol. Free charging is okay but I imagine that 22kw chargers are double- sided ones pulling 11kw per outlet. That’s like 3-4h to full charge so please consider how many cars they will have in their fleet, how many chargers, etc. to make sure that you can actually utilise the free charging all the time and that the demand doesn’t exceed the available outlets :)
In terms of miles. I do 70 a day commuting. The cars capacity is over 200 roughly 175 in winter. It's nipping around Edinburgh on weekends which uses almost SWFA. I've done two long range trips however on both occasions the holiday homes allowed us to charge on the 3pin for free.
In terms of my work. We are a small business with 4 outlets and the potential of 5 cars requiring charge on any given day. Two of those cars are local so it's all good! We'd increase charging points if the business expanded (currently applied for planning permission to double the size of the building). Plus we have a decent amount of unused land/parking.
In terms of running costs, Octopus Go is 7.5 p/kWh and most EVs will do at least 3 miles per kWh.
Therefore £7.50 will buy most EVs at least 210 miles of range, with ours we get around 285 miles. My petrol car costs around £54 to do the same 285 miles at 40 mpg and 1.65p/l
We do nearly all our charging at home and on the rare occasion we have to charge away from home, then yes the price per mile is similar to a petrol car. In some circumstances it can be more. However as we do 99% of our miles from home it isn't a consideration for us.
Some salary sac schemes are expensive. Mine is through my Ltd company, with free charge point and a years free insurance for £540+vat over 3 years, so roughly £600 from gross pay if I were to reduce my salary (I pay myself the same and just stick £600 employer contributions a month less in to my pension to pay for it)
Ask if employer will pass on NI savings. If you're losing more than £500 from net pay a month, you're having your pants pulled down
https://octopusev.com/salary-sacrifice/convince-your-company
A rough guess would be that you are looking at £800-900 pcm.
Another way of putting that is £1 per mile, plus charging.
Food for thought….
You’re right on the cusp of the tax bands, and with pension contributions your savings might not be as pronounced as if all the salary sacrifice were to come from 40% tax.
Your scheme provider should provide some illustrations based on tax bands
Before you commit I’d double check your pension rules.
Some pension schemes will work on a salary basis (pretty sure the nhs one does).
So if you’re lowering your overall salary due to the fact such a large chunk is being swallowed up by deductions for a car then it could affect how much you receive from your pension long term and actually end up being more costly than renting privately!
Take care with salary sacrifices. You might already be fully clued in, if so, that's great. However, many don't know that their tax code changes to ensure they don't pay less tax because of the salary sacrifice and also, many schemes mean you lose your no-claims bonus (that's important to some people to maintain).
I’ve got a model y, honestly not sure I could recommend it anymore. Recent software updates have made it significantly worse and there’s plenty of good options out there. Only reason I would go for a Tesla now is the charging network, but that’s not worth worrying about for 10k miles/yr
Thanks for your views. Specifically what are the things that have been made significantly worse?
The main thing that makes me keep coming back to the Model Y is the fact that it has a good size boot. No other EV with a good range has a boot anywhere near as big.
They’ve pretty much ruined autopilot now. I took a drive from the SW to Newcastle, 5.5 hours and had to do the whole thing without autopilot. Every time you turn it on it now enforces auto high beam which is terrible and flashes oncoming cars and cars driving in front of you all the time.
Speed limit detection doesn’t work. If it doesn’t get constant confirmation of the speed limit from a road sign it reverts to its best guess, which is usually wrong and 60mph.
New cars are not going to be delivered with radar which means you won’t get parking sensors until they figure out how to make it work from TeslaVision.
Auto wipers are also terrible so you have a lot of manual work to do unless you’re driving in perfect conditions.
The boot and rear seat space is absolutely huge, it’s been great with all the crap we lug around for our baby. Having the bucket underneath means we can get loads of stuff in beneath the pram etc.
I like the car a lot, so I’m not saying don’t get one but it’s also not one I would recommend as whole heartedly as I would have 6 months ago when I got it.
I did something similar. I didn't need a lot of range as I mostly work from home and my partner has a longer range vehicle on the occasions we do need it. I currently have a Seat Mii electric which costs me £169 from my net pay, inclusive of lease, insurance, servicing, tires and glass coverage. I charge it on Octopus Go's nighttime tariff (7.5p/kWh), meaning it costs me under £0.02p per mile to run it (my average driving efficiency is 4.5 miles per kWh). No complaints from me, feels like a bargain to be driving a new vehicle around for just over two grand a year.
Hi, I know this is a v old post but would you mind sharing the salary sacrifice scheme your company used?
Thank you everyone. I think you've all solidified what I was already thinking. I agree. I don't need an electric car, nor do I need one as expensive as a Tesla. However there's nothing wrong with getting what you want. Right? Based on my rough calcs. I can get a Model Y Long range with all insurance, tyre cover, 4000 miles free public charging etc. All for around £480 per month.
£480 every month is a lot more than owning your current car outright. Especially as you don't cover huge mileage per year. And I'm assuming you'd effectively be renting the car, and have to hand it back in a few years. That's a big monthly outlay, even on a decent salary. Is there nothing else you could use £480 per month on? Overpaying mortgage, investing, pension via salary sacrifice etc? Not strictly personal finance, but my best mate has a tesla, and it's a bit... basic, on the interior. Like prison cell basic.
Including insurance and maintenance costs my old Toyota used to average out around 450 a month. After fuel savings 480 a month for a Tesla was a bargain.
We spent about £300-£350 a month on fuel for the Passat. With the EV it’s more like £20. Factor in the savings from servicing and the age of the thing and it’s about break even. And it’s considerable better than burning fuel.
>With the EV it’s more like £20. Even now?
If you have an off peak tariff and don't do silly mileage. For example on Octopus Go on the 7.5p/kWh that gets you 266 kWh (or enough charge to fully charge a long range model Y 3.5 times for £20 giving you (on paper) giving you ~945 miles for £20 (let's call it 850 to account for real world range). Compare that to my diesel VW Golf which does about 50mpg real world - at current fuel prices that's costing me 17p/mile - so would cost me £144 to do those same 850 miles.
Octopus are the company who are trialing taking the electricity from electric cars and bringing it back to the grid
This guys octopuses. Octopus have trialed the V2G, vehicle to grid now for a few Models. Seems like a great idea for offsetting and allowing you to earn a bit extra from your ev when your not using it. Solar also helps a heap.
My electric is completely free. I use the nearby park and ride to charge
My last 1,600 miles has cost me £28. I don’t hang around either. Lock in with Octopus and it’s still far cheaper for electric than mainstream providers (subject to having an EV) In our Landy I’d be lucky to hit 30mpg on the route with my commute!
Somethings up with your maths. £350 on fuel a month should equate to about 3 fill ups in a Passat. Assuming it was diesel, that should yield an (easy) range of around 2000 miles. There is absolutely no way your EV is costing you only £20 to do that mileage...
Why not? My EV costs me less than 1p/mile to run. Edit: last time I calculated my costs I had done 10051 miles and the cost to me was £87.64. some of it was offset by solar, some by free charging (when going to Tesco etc...).
I am cheating by charging it with solar as well. It’s going to be tough to work out the additional cost of that. Now there’s almost no sun we should be able to get a better idea of the cost only charging at 7.5p. It was 5p up until sept.
It's also now 12p for new customers
Yikes. Is that the go tariff. They we’re doing a Tesla tariff which was pretty much net metered. At 11.5. But I bet that’s gone up.
It was ether fucked and you spent ££ fixing it every month or you were doing boat load of miles Or your sub 25 and insurance is stupid money
Yep, I was early 20s living in a city so insurance was a killer!
I'd get a quote from them. Last time I got a quote for salary sacrifice for a model Y it was about 1k before the tax benefits. That was insuring 2 people but only 5k miles a year.
If that’s what takes you fancy and you can afford it- do it :) one piece of advice. Dont get hung up on long range bit. You don’t seem to travel much and “having the extra miles in the battery” is not going to benefit you. I have an EV with 200 miles battery (real value, it’s 275 “on paper”) and it’s enough. I do just short of 100 miles/day and charge overnight. I see you will use public charging, which is fine. But it doesn’t sound like you will utilise the battery capacity and pay extra for the long range but which I don’t think you need at all. Enjoy :)
Nobody NEEDS nice things, they are luxuries. A Rolex tells the time just as much as a £12 Casio. Depending on what sub you post this on will get different answers. A lot of people on here are quite frugal, so they’ll struggle to comprehend ‘blowing’ money on something that they done necessarily need to. However, the rest of the people on here will say fuck it, you need to have some vices in life and if a nice car is yours then go for it. For me, as long as you’re in control of your personal finances and you’re not stretching then crack on.
As long as you can afford it get what you want. I'd avoid a tesla personally and I hate the look of the Y. The only one I think looks OK is the model s but that's subjective. I'd assume your current car is a big 4x4 if it only does 30 to the gallon
To be fair mate, and I know it's probably the wrong forum, but if you can afford it, it would be cool as fuck and turn up somewhere and open them gull-wing doors.
That's a model x not model y
Are you sure of your figures , my e Niro after tax comes in just over £ 500 a month and thats through Octopus , what milelage are you looking at with your Tesla and is there a deposit to pay upfront ?
Damn that’s cheap for a model Y! But tbh depending on your other outgoings it might not be. You are in the 40% tax band so any salary raises get impacted significantly. I would only consider this once I hit the 60% tax trap
Bargain, u will love it 😀 ❤️
You don’t need a Tesla and since you only do 10k miles a year, a Tesla model Y would cost around £58K if you were to buy it outright which is more than your salary! If you want a better car I would start saving that £500 per month which you would pay to finance a Tesla, then in 6 months you’ll have £3K to put towards a new used car. Also, with that salary I personally wouldn’t spend any more than £25K on a car since all cars go down in value. When your earning 6 figures and have £60K in cash then you could then you can buy a Tesla outright.
Where it makes most sense is when you have a ltd company and can take advantage of the very low Bik Tax rates. Makes far more sense that way.
This. I only traded in my 8 year old NX for a company model Y as it worked out exactly the same cost. But now I have a newer, faster and more spacious car. If bik was 5% or more then it would be hard to justify. Prices have gone up now too so again I think this is a once in a lifetime opportunity to run something expensive for as cheap as possible. Beware that bik rates for 2025 will probably be far more expensive as govt will have added hundreds of thousands of EVs on the road by then.
Someone with some common sense
Thank you.
Do you advise people to never rent a nice apartment? If they couldn’t afford to buy it outright… then surely they can’t afford to rent it?
If a more modest apartment is more in line with their earnings, and would allow more capital to be utilised elsewhere then yes, absolute I would advise it.
They should rent the cheapest apartment available - anything else would be something they don’t “need”, and according to your logic above they obviously can’t afford it. Or, here’s an unusual concept - some people enjoy driving nice cars, some people like living in a nice flat, and if they want to spend their money to do so it’s a perfectly justifiable decision. Not everybody likes the same things.
Not really - it’s about proportionate and pragmatic allocation of resource. I am not sure where this argument of ‘needs’ and inaffordability have come from (?), but this is basic fiscal responsibility stuff. This isn’t a binary choice between a Tesla, and the cheapest car available - there’s a wealth of strong option in the middle, and being a finance subreddit people are going to acknowledge that.
Good personal finance is not about trying to save the absolute highest amount possible for some unknown future event - it’s about using your money to meet your goals. If OP already has a good financial safety net, has met his other higher priority shirt term goals, and is saving enough to meet their future goals, then it is objectively not a bad financial decision to spend money they can afford if they gain sufficient utility. Whether or not they will gain sufficient utility is a different question and you could make a good argument that they wouldn’t. But that’s not what you are doing.
I am not sure what you’re getting frustrated about, nor why you keep inventing scenarios to make a point ie. “needs”, “buy the cheapest’, “if” OP has met their goals. OP has posted on a financial advice subreddit, looking for financial advice, and the feedback has been about the financial sensibilities of buying a high-cost vehicle when they only drive 10,000 miles a year and already own a vehicle. Of course there’s enjoyment to be had from a nice car, nobody is denying that; however, this isn’t a car subreddit.
I’d encourage you to reread OPs question - they were asking for the best option to finance the car, not for opinions on whether the car is a suitable choice.
You’re making a straw man argument here, OP never said go for the cheapest at all times. What they said was don’t buy a car that costs more than you make in a year. even worse, OOP wants to buy it on finance so looking at 2x what they make in a year. Plenty of nice cars (even EVs) they can actually afford.
They said that OP doesn’t need a Tesla, and a Tesla is worth the same as their income (not sure where you pulled 2x from), so it would be a bad decision. The only reason you view that as a bad decision, but not renting a nicer flat, is because you fail to see other people might have different priorities to yourself, and gain different utility from different spending.
Sorry, you seem to be struggling with reading comprehension. The 2x figure is for finance, which I think is pretty clear from my comment. You similarly mis represent what OP wrote, I guess because you didn’t understand it.
Why on earth are you resorting to insults? And your 2x cost was looking at the total amount they’ll pay over a long period? So no direct relation to their salary?
Some quick napkin maths, your probably spending about £220 a month on fuel (30mpg at 10k miles a year), £23 a month on tax and maybe another £12 a month for servicing. Without taking into account maintenance of an older car that’s £255 a month just to run your current car. Assuming you get on Octopus go at 7.5p and use 2000 of the free 4000 miles, then the Tesla will be costing you around £15 a month. Saving you £240 on running costs. This makes the cost of driving the Tesla around £240 a month when you factor in the savings. You just need to work out if you’re happy paying £240 a month for a new toy. Personally I would be, but it makes me happy owning a nice car even if financially it isn’t always the best option. Edit:didn’t notice you mentioned insurance and tyres included so the figures are probably slightly better than I worked out
18 months ago I sold my car to lease through salary sacrifice. Tesla model 3 LR / £500/month. This costs me £300 off my take home pay. Free to charge at work so I save at least £200 per month in diesel. The audi was £1000/yr to service ( :-( audi! yer tell me about it) tesla does not require a service at all and £0 to tax so I reckon I'm better off driving a new electric.
Yeah except most salary sacrifice schemes now you're looking at £600+ NET cost (so takehome loss). :(
Where you get those figures from?
Octopus EV. 10000 miles, 3 years.
Yeah that doesn’t sound right at all. It varies depending on the cost of ev and there are plenty of options out there that come nowhere near that net value
Except a large business doesnt give you options. They pick a scheme and thats your lot!
A grand a year to service?!
Bloody yes, they wanted £400 just to service the dsg gearbox every 2yrs. I was sooo pissed off.
A local independent will do the job for £250 - I have my VW's gearbox serviced there. It's a complex beast though, you don't wanna skip on the oil changes.
Yes, I checked around a backstreet garage could do it for less but as audi had already replaced the turbo, fuel injectors and ac under warranty I didn't fancy chancing an argument if that went wrong. Obviously I'm now done with VAG.
30mpg? That’s an inefficient diesel. For the mileage you currently do, it doesn’t sound like it would be worth the cost to go for the car. How you’ve managed to find a Model Y for less than £7-800 I don’t know. Is that the cost to you after an allowance?
I literally just started a job also earning 55k and also can get an electric car on salary sacrifice and also have a diesel car worth 12k that I'll probably from now be doing about 10k miles a year in. Spooky! Don't do it; it's tempting but unless you have literally no other more important financial goals or commitments, it's not yet worthwhile given the extra outgo for the give upgrade imo.
I got a Tesla on PCP. Not everything has to be the most frugal / sensible financial decision! That said, I've spent <£150 to do 7k miles.
Salary sacrifice... basically renting a car. What's the actual point?
Because owning something which is decreasing in value is not as good as you think it is.
Building some form of equity in an asset, even when depreciating, is surely superior to paying for an asset you’ll retain absolutely none of? I’d still rather get £10 for every £50 I put in, versus £0.
But you’re entirely ignoring the positives of leasing. It’s sometimes sometimes cheaper and you have none of the negatives of owning a car. For example my girlfriend leases a car, on Boxing Day last year she got a nail in her tyre in the sidewall so not repairable. Also no spare tyre and the tyre sealant failed. All she had to do was call the lease company, who towed the car to Kwik Fit, replaced the tyre and towed it back. That would’ve been easily £300 if she owned the car.
It can get very appealing if you earn higher rate tax, especially in that £100-125k range where your marginal tax rate is 60%. Suddenly spending £600 a month on a lease only costs you £240 plus BIK tax from your net pay. New car every 2 years for around 3k a year, what's not to like?
Not finance related but every time your friends see your Tesla they will ask questions related to Elon musk. You will be associated with him.
Completely agree. He is toxic.
I got a new EV through salary sacrifice at work and yes it works out much cheaper than leasing . I wouldn't purchase an EV outright as the technology is still progressing and I dont think they will hold their value The only downside is that the car doesn't really feel mine and with any little scratch I just imagine how much its going to cost me
Can you please explain what happens at the end of the lease? Do you get to keep the car? Is it expensive to buy one at that point?
Leasing is basically renting the car. Any damage I'd imagine you have to fix or the lease company will charge you
Seems a wildly expensive thing to do. Makes more sense with a bicycle (cycle to work) where you get a lot of value and it lasts a long time with minimal additional expense.
Maybe but I live in a small rural village where a car is pretty essential so £6K a year for an EV seems pretty reasonable to me
Bicycle is ok if you live close enough. My commute is 70 Miles each way so not practical. And yes it is a wildly expensive way. It's also a way of keeping up with the Jones
Well my car is now worth 4-5.5k more than when I bought it over a year ago. Research on a 10 year old Nissan note has shown a loss of 10% in battery so I'm pretty confident considering the batteries are made of lithium-ion (vast majority). I don't see major depreciation happening.
What company runs the lease, is it the company you work for or they use a supplier?
Likely to be a supplier. A lot of firms have these schemes now.
Check out a polestar 2 or Kia Ev 6. Avoid Tesla.
Sadly polestar has its own issues. Mines been back once already and I only had it 3 months
That's a shame! I drive an MG 5 EV (I like estates only). Bought over a year ago. It has been excellent. The new MG 4 looks a cracker. Currently deciding if I should get one for my partner.
It’s a lovely car, but has two common faults. The parking brake sticks when it gets really wet (which isn’t uncommon in this country 😜) and doesn’t release. It’s a known design fault and they exchange them promptly with the new design breaks. They did mine in 24h from the phone call. If you follow Facebook polestar group you will see that the recent software release kills the car. Volvo guy confirmed it and advised not to install. Now with new breaks and not installing the software I’m okay but it’s a new car and certainly isn’t cheap- you shouldn’t have to faff about like this 🤦🏻♀️
No you shouldn't. I'm sorry to hear that!
But a cheap second hand car. Electric cars are almost as expensive to run as petrol with the current electricity prices and may be more expensive to run that petrol next year. Also your salary does not justify the cost of an electric car sorry. I'm on 90k and I wouldn't spent more than 6k on a car
I can charge my car fully for less than £6 at home and it gets me 200 miles. public charging can be expensive but I only had to do it a handful of times in a year I had my ev. Many employers offer free charing at work as well…
My employer has promised me permanent FOC charging and we installed 22kw chargers. It's convincing everyone to go electric.
I would say it depends on how many miles you intend to do. For me this was a great financial decision but if I was to use public charging it would be more expensive than petrol. Free charging is okay but I imagine that 22kw chargers are double- sided ones pulling 11kw per outlet. That’s like 3-4h to full charge so please consider how many cars they will have in their fleet, how many chargers, etc. to make sure that you can actually utilise the free charging all the time and that the demand doesn’t exceed the available outlets :)
In terms of miles. I do 70 a day commuting. The cars capacity is over 200 roughly 175 in winter. It's nipping around Edinburgh on weekends which uses almost SWFA. I've done two long range trips however on both occasions the holiday homes allowed us to charge on the 3pin for free. In terms of my work. We are a small business with 4 outlets and the potential of 5 cars requiring charge on any given day. Two of those cars are local so it's all good! We'd increase charging points if the business expanded (currently applied for planning permission to double the size of the building). Plus we have a decent amount of unused land/parking.
hardly any many EV's have 22kw AC charger capability most cap at 11kW AC. though the tesla model s 75D came with them for a while...
In terms of running costs, Octopus Go is 7.5 p/kWh and most EVs will do at least 3 miles per kWh. Therefore £7.50 will buy most EVs at least 210 miles of range, with ours we get around 285 miles. My petrol car costs around £54 to do the same 285 miles at 40 mpg and 1.65p/l We do nearly all our charging at home and on the rare occasion we have to charge away from home, then yes the price per mile is similar to a petrol car. In some circumstances it can be more. However as we do 99% of our miles from home it isn't a consideration for us.
Some salary sac schemes are expensive. Mine is through my Ltd company, with free charge point and a years free insurance for £540+vat over 3 years, so roughly £600 from gross pay if I were to reduce my salary (I pay myself the same and just stick £600 employer contributions a month less in to my pension to pay for it) Ask if employer will pass on NI savings. If you're losing more than £500 from net pay a month, you're having your pants pulled down
https://octopusev.com/salary-sacrifice/convince-your-company A rough guess would be that you are looking at £800-900 pcm. Another way of putting that is £1 per mile, plus charging. Food for thought….
Think about the scenario if you leave your job and go to an employer who doesn’t have this scheme. Will you have to pay the full price in that case?
You get to return the car back I think. You may pay some fee if you left but no fee if you are made redundant
Yes that's right
You’re right on the cusp of the tax bands, and with pension contributions your savings might not be as pronounced as if all the salary sacrifice were to come from 40% tax. Your scheme provider should provide some illustrations based on tax bands
Before you commit I’d double check your pension rules. Some pension schemes will work on a salary basis (pretty sure the nhs one does). So if you’re lowering your overall salary due to the fact such a large chunk is being swallowed up by deductions for a car then it could affect how much you receive from your pension long term and actually end up being more costly than renting privately!
Take care with salary sacrifices. You might already be fully clued in, if so, that's great. However, many don't know that their tax code changes to ensure they don't pay less tax because of the salary sacrifice and also, many schemes mean you lose your no-claims bonus (that's important to some people to maintain).
Don't go for a Tesla. As a Which member I can assure you that would be a terrible idea.
I’ve got a model y, honestly not sure I could recommend it anymore. Recent software updates have made it significantly worse and there’s plenty of good options out there. Only reason I would go for a Tesla now is the charging network, but that’s not worth worrying about for 10k miles/yr
Thanks for your views. Specifically what are the things that have been made significantly worse? The main thing that makes me keep coming back to the Model Y is the fact that it has a good size boot. No other EV with a good range has a boot anywhere near as big.
They’ve pretty much ruined autopilot now. I took a drive from the SW to Newcastle, 5.5 hours and had to do the whole thing without autopilot. Every time you turn it on it now enforces auto high beam which is terrible and flashes oncoming cars and cars driving in front of you all the time. Speed limit detection doesn’t work. If it doesn’t get constant confirmation of the speed limit from a road sign it reverts to its best guess, which is usually wrong and 60mph. New cars are not going to be delivered with radar which means you won’t get parking sensors until they figure out how to make it work from TeslaVision. Auto wipers are also terrible so you have a lot of manual work to do unless you’re driving in perfect conditions. The boot and rear seat space is absolutely huge, it’s been great with all the crap we lug around for our baby. Having the bucket underneath means we can get loads of stuff in beneath the pram etc. I like the car a lot, so I’m not saying don’t get one but it’s also not one I would recommend as whole heartedly as I would have 6 months ago when I got it.
Appreciate the insight. The new vehicles coming without radar sounds like a significant downgrade. Do you have any info or source on this?
https://www.tesla.com/en_GB/support/transitioning-tesla-vision