Nice Car – But Can You Really Afford It?

(Updated for 2018)

You’re sick of waiting for the bus to get to work. The train is expensive and neither option seems very reliable these days, as every other day there seems to be a delay or cancellation. Life would be so much easier if you had a car. And more fun.

Having a look around, there seem to be some bargains out there. Especially if you’re willing to go the used car route. There are some decent finance deals as well, even if your credit is a bit dodgy.

So, after shopping online for a few weeks you head out to the dealer. The beauty on the forecourt – the nice little runaround that would be perfect for getting to work and for all kinds of leisure purposes –  would, the saleslady says, only cost you £200 a month. You could swing that.

However, before you sign on that dotted line – actually before you go to the dealers at all – you do need to stop and work out exactly what the car will really cost you, because it may be a lot more than you bargained for.

Why’s that? Allow us to explain:

The Legal Upfront Running Costs

Most cars purchased from a dealer do come with a good MOT and some may even be taxed already, but that’s not always the case. And even if it is, once you buy a car, you have to insure it. You don’t have a choice, it’s the law.

If you are financing the car the dealer won’t let you get away with third-party minimum coverage either. Until you’ve paid every penny on the vehicle it’s still theirs, and they want to make sure their asset is properly protected.

So right there, the chances are good that you will, in addition to whatever downpayment the car dealer wants, have to come up with the cash for at least the first months insurance payment and then for every month thereafter (although it’s cheaper if you can pay 12 months in advance and less of a hassle)

Running Costs

Next, you have to look at the running costs. Not just petrol, we’ll get to that in a minute. Costs like all of the following:


  • Basic parts replacement – Tyres every one to two years, brake pads every two to three, headlight and sidelight bulbs at annoyingly random times


  • Sensible maintenance – Tune-ups, car washes, car detailing, MOTs etc.


  • Accessories – car mats, air fresheners

The Extras It’s Easy to Forget

How much is a litre of fuel at your local garage? How far will that take you in the car you are considering purchasing? How much is fuel near your office? How much will it cost you to park near your office? These are going to be daily costs that you can’t avoid and yes, they add up really quickly.

The Unexpected

Even the best maintained of vehicles can go wrong at any time. Will you be able to handle things if, for example, the suspension failed and you needed to pay a mechanic before he started work?

The simple fact is, on top of your £200 a month car payment you could be looking at anywhere between £150 – £300 in day to day and running costs on a monthly basis. Now, can you still afford that? Be honest with yourself before you make a final decision.

For those of you that already bought a car and face an unexpected emergency repair or need new tyres, remember you can get between £100 and £1000 as a short-term loan by filling in our application form and applying now.