Budgeting for Owning, Financing, Servicing and Maintaining Your Vehicle
If, like most people who own a vehicle, you don’t have limitless funds, purchasing a vehicle and considering a monthly funding budget (to at least cover the depreciation and any interest that you are paying on a loan), is only the first step that needs to be given detailed thought, prior to making a decision about acquiring a specific make and model.
Owning Your Vehicle
A motor vehicle is a depreciating asset and, therefore, if you want to produce a monthly, annual and whole life (the amount of time that you plan to keep the vehicle) budget/cost for running a vehicle, the process has to begin with considering its projected, future value.
This is not an exact science, however recent and historical values give you a good indication of how a specific make and model of vehicle holds its value.
For instance, a Volkswagen Golf holds its value much better than a Renault ???
One of the most important factors to take into consideration, when deciding on what vehicle to acquire, is the projected depreciation of that vehicle (the difference between what you pay for it and what you get for it when you sell or part exchange the vehicle).
This is where our knowledge of the market and our independent advice can help our customers.
Financing/Funding the Acquisition of Your Vehicle
There are so many different names for Funding facilities, which must confuse the majority of consumers and a reasonable percentage of business people.
There are basically four forms of funding facility relating to motor vehicles:
- Personal Loan
- Hire Purchase (Contract Purchase, Lease Purchase, PCP)
- Finance Lease
- Contract Hire
There are multiple forms of repayment profiles, balloon payments and guaranteed buy-back options that make up all the various terms used for each of the four facilities above.
Our advice is to always look at the “Whole life” cost of having the vehicle and we find that most customers are pleased to have this explained to them. That’s where we come in…
By having detailed discussions with customers, we can provide advice on what might be the best course of action for them.
We don’t have any targets for selling you a specific vehicle or finance facility.
Once you have the required information, you can decide whether or not you will benefit from dealing with us.
It is relatively easy to calculate an approximate, annual or longer term budget to cover the cost of running and maintaining a vehicle.
All the information needed to do so is readily available:
- obtain standard servicing costs from your Service provider
- obtain costs from various operators for supplying and fitting:
- front brake discs and brake pads
- rear brake discs and brake pads (Rear brake shoes on some models)
- rear handbrake, pads or shoes, on some models.
- wiper blades
- calculate the amount of fuel that you will use, based on the Manufacturer’s fuel consumption figures.
- obtain the cost of acquiring:
- the highest quality of Mechanical/Electrical, parts and labour, breakdown repair cover
- home start, roadside recovery
Next you need to consider the following:
- the number of miles that you travel per year
- whether it is urban, rural or a mixed type of driving
- whether you are travelling on smooth or rough roads
- very importantly: the type of driver that you are
(This is because there can be as much as a 25% difference in the fuel consumption obtained between an efficient driver and one that is not. There can, also, be significant differences in the mileage that one driver obtains from a set of tyres and front brake pads, compared to another.)
Yes, we said, previously, that it is relatively easy to calculate an approximate, annual or longer term budget to cover the cost of running and maintaining a vehicle that is up to 8 years old.
Relatively easy compared to what?
Relatively easy to calculate compared to having to find the extra amount of money that can be needed to cover unforeseen faults/problems that do occur on the modern vehicle.
Modern vehicles have an increasing number of parts that are expensive to repair and, on the majority of occasions, give little or no warning as to when they are going to fail.
Some parts have an electrical element to them, hence the reason for the lack of failure warning, such as:
- Exhaust Gas Regulator Valve (EGR valve)
- Electronic Handbrake System
- Electric Windows
- Satellite Navigation System
- Fuel Pump
- ABS Pump
Then there are the mechanical parts, such as:
- Duel Mass Flywheel
- Clutch System
- Turbo Unit
- Mechanical Fuel Pump
- Catalytic Converter
- Power Steering System
- Suspension Units
- Air Conditioning Unit
- Coil Spring
- Wheel Bearing
and many more.
Fortunately, there are ways to cover yourself for such eventualities:
See: Vehicle Warranties
Vehicle Servicing, Maintenance and Warranty
Full Maintenance Contracts
On vehicles between new and 8 years old, we offer Full Maintenance Contracts, removing the possibility of you encountering heavy, unforeseen costs.
This is the part that is unusual, when compared with the contracts generally offered by others!
Our objective is to offer you the most cost-efficient way of servicing and maintaining your vehicle for the time it is your responsibility to do so.
We naturally build in a safety margin, as far as the overall costs are concerned. If we didn’t, we would be exposed to possible losses.
The difference with our contract is:
- You only pay what is required to meet the servicing and maintenance costs, over the period of the contract.
- At the end of the contract, if you have paid more, you receive a refund, which is equivalent to the difference between the actual costs and the amount you have paid on the contract (most other contract providers retain this amount as additional profit).
We see this as a win-win situation for you.
Please contact us for further details.
Our attitude is:
- if we are not doing what is best for you, we are not doing the best we can
- no ifs or buts
- no excuses
- if we should ever fail to do what is best for you, we expect you to tell us so that we can make every attempt to put things right and to ensure that it doesn’t happen again