How do people afford a car?

[A0wen]

Everyone knows the railway needs paying for, but that is of little comfort to the end user who can't afford it, or simply finds the cost unacceptable. The alternative is to get the taxpayer to pay more of the bill like they do in other countries. Then at least the cost of the fare can be one less factor deterring people from using the train.

Bit in bold - sorry that's life and applies to everythig, not just rail transport. You pays your money you takes your choice. If you can't afford something that's not somebody else's or society's problem.

So where do you propose the extra subsidy comes from? Has to come out the tax pot somewhere so put your cards on the table and declare *who* you think should pay more and how much more they should be paying. Ideally with a bit more justification than "somebody else who earns more than me".

It won't affect many people until EVs become affordable. My friend lives in the current London ULEZ area and has decided to keep his non-compliant car, put it on Auto-Pay and see how often he gets charged. He only uses it occasionally so might not be caught on camera very often.

ULEZ currently means Euro 4 petrol or Euro 6 diesel on passenger cars - Euro 4 regs came out in 2005, so most petrol cars of up to 10 years old will be Euro 4 compliant. Euro 6 came out in 2015, so 7 years ago now - so the biggest impact on extending ULEZ will be on diesel cars over 5 years old.

 

[Ken H]

Out of interest I've just had a look on a comparison site, and the cheapest Third Party Fire and Theft policy was actually around 30% more expensive than the cheapest Comprehensive policy. Might be different for others, but I'd suggest that unless you had a very cheap car going with anything other than Comprehensive would not be a sensible idea.


...

Look at comp but massive excess. Often cheaper than TPFT. If the excess is more than cars value its effectively TPFT.

 

[johncrossley]

Bit in bold - sorry that's life and applies to everythig, not just rail transport. You pays your money you takes your choice. If you can't afford something that's not somebody else's or society's problem.

It isn't as simple as that. Car travel has various negative effects, both for the locality and the world, hence the promotion of public transport as an alternative. If people cannot access jobs or other activities then that also impacts on the wider economy as well as the individuals directly affected. Deprivation can lead to poverty and crime, which affects the affluent.

So where do you propose the extra subsidy comes from? Has to come out the tax pot somewhere so put your cards on the table and declare *who* you think should pay more and how much more they should be paying. Ideally with a bit more justification than "somebody else who earns more than me".

What do you think they do in other countries where transport is heavily subsidised? It is far from a niche thing.

 

[Flying Snail]

Out of interest I've just had a look on a comparison site, and the cheapest Third Party Fire and Theft policy was actually around 30% more expensive than the cheapest Comprehensive policy. Might be different for others, but I'd suggest that unless you had a very cheap car going with anything other than Comprehensive would not be a sensible idea.

Third party claims form the bulk of insurance costs these days, thanks to compo culture, fraud and paying for uninsured drivers.

Also people seeking TPFT are often classed as higher risk, especially on low cost cars, so often it throws out higher quotes than fully comprehensive.

 

[Ken H]

I am not sure increasing taxes to subsidise public transport is an option. An increase in tax does not necessarily mean an increase in revenue. People will seek to avoid tax more as rates rise, or simply do less work. Check out the Laffer Curve.
So to subsidise public transport more you woukd have to decrease spend elsewhere. Schools, hospitals. Or where?

 

[pitdiver]

I don't own a car but live in a village. I have never owned a car but have used public transport for all of my life. Living in London in the past and in addition working for London Transport/TfL it wasn't worth having a car. Now I have retired with an ENCTS and priv travel facilities a car is not a necessity in my mind.

 

[A0wen]

What do you think they do in other countries where transport is heavily subsidised? It is far from a niche thing.

They raise taxes - question is *who* do you want to pay more?

A practical example Sweden's maximum personal allowance i.e. the amount you earn before you start paying taxes is less than £4000 - whereas in the UK that's over £10,000 - so should we follow the Swedish example and tax *everybody* more?

 

[johncrossley]

They raise taxes - question is *who* do you want to pay more?

A practical example Sweden's maximum personal allowance i.e. the amount you earn before you start paying taxes is less than £4000 - whereas in the UK that's over £10,000 - so should we follow the Swedish example and tax *everybody* more?

'Low tax' Switzerland seems to have good public transport. Although they prefer to have expensive private health insurance there rather than healthcare free at the point of delivery. Then there are the 'tax and spend' Nordic countries. You have frugal Germany, who chastises southern Europe for being reckless with their lack of prudence. So, despite such variance in their overall attitudes to taxation and public spending, by and large, European countries generally subsidise public transport heavily. Many countries seem to think public transport is too important not to subsidise it, even if they don't spend so much on other things.

 

[Ken H]

They raise taxes - question is *who* do you want to pay more?

A practical example Sweden's maximum personal allowance i.e. the amount you earn before you start paying taxes is less than £4000 - whereas in the UK that's over £10,000 - so should we follow the Swedish example and tax *everybody* more?

Most people want the 'rich' to pay more. but no-one defines what 'rich' is.
Unless you tax middle earners more the revenue isnt worth the bother.
And as I said above re the Laffer Curve, taxing the 'rich' more wont necessarily bring in much more revenue.

 

[Ken H]

'Low tax' Switzerland seems to have good public transport. Although they prefer to have expensive private health insurance there rather than healthcare free at the point of delivery. Then there are the 'tax and spend' Nordic countries. You have frugal Germany, who chastises southern Europe for being reckless with their lack of prudence. So, despite such variance in their overall attitudes to taxation and public spending, by and large, European countries generally subsidise public transport heavily. Many countries seem to think public transport is too important not to subsidise it, even if they don't spend so much on other things.

Would be interesting having a referendum. 1% on basic 20% rate to pay for trains and buses. Hmmm.

 

[ar10642]

Would be interesting having a referendum. 1% on basic 20% rate to pay for trains and buses. Hmmm.

Would get voted down because nobody wants to pay for anything.

 

[Starmill]

CPI + 1% on rail fares is frankly extortionate.

Unfortunately, it seems the answer to demand is raising prices, rather than adding capacity to get more people on the trains.

The government use RPI just to push up prices more. They should use CPI. Luckily by 2030 they'll have to as RPI won't be published any more, but not before they've achieved years of gouging us out with large above inflation rises.

 

[A0wen]

You need to understand the elasticity. How many more people you get buying tickets for a percentage drop in price.

And vice versa - if you increase prices does the increase in revenue offset any reduction in demand.

 

[Starmill]

A decision needs to be made then. Make it affordable and useful to everyone or get rid of it. What's the point in the taxpayer forking out for a service that's been cut back so much as to be useless or costs so much that people don't use it?

Indeed. For it to be worthy of the large subsidy it needs to produce something that will be of use to the ordinary person.

 

[BingMan]

Though it is worth pointing out that "driving a car costs about 50p/mile" is a fallacy used by anti-car campaigners. I don't account my car's fixed costs per journey any more than I work out my rail miles per year and split the cost of my Network Railcard across them. The fixed costs are effectively a membership fee to car ownership paid pretty much regardless of usage levels.

Why does my employer, not renown for his generosity, pay me 45p per mile when I use my car on business use if that is not what it costs?

 

[ar10642]

Why does my employer, not renown for his generosity, pay me 45p per mile when I use my car on business use if that is not what it costs?

It may well cost that much if you take the total cost and divide over all the miles ever done in the car but that doesn't make any difference when it comes to deciding whether to drive or use the train. If I drive an extra mile it won't cost anything like an extra 50p, a lot of the costs are fixed. If you're paying the fixed costs you might as well use it.

 

[Ken H]

Why does my employer, not renown for his generosity, pay me 45p per mile when I use my car on business use if that is not what it costs?

Thats the inland revenue rate. if you buy a new car, then 45p is reasonable taking into account the massive depreciation.

 

[Starmill]

Why does my employer, not renown for his generosity, pay me 45p per mile when I use my car on business use if that is not what it costs?

Because it's significantly easier and simpler for them to pay the rate set by HMRC? They could if they wished maintain a database of everyone's car and try to work out costs individually but why on earth go through so much administration when a tax free amount that's in common usage has already been specified?

 

[philthetube]

If you do High mileage and have heavy depreciation, insurance and maintenance costs then 45p is not excessive.

Insurance costs more both for business use and for high mileage, and you cannot run a banger and maintain it yourself if you spend most of the time on the road.

It is generous if you do the occasional trip which does not affect your annual mileage much, though you still need to be careful about insurance.

Imagine someone doing 30.000 miles a year, getting 10 miles per litre at 1.70 , they would receive £13,500 mileage money, so

£13,500
-£5.100 petrol
-£0.700 Insurance
-£1,500, servicing, tyres etc.

Tyres and insurance costs cold well be understated.

£6,300, left with which to cover depreciation and any other costs, breakdowns AA membership or whatever, not that large amount, but this is not what the thread is about, someone doing relatively low mileage and not needing a high maintenance car can run a car much more cheaply.

 

[bspahh]

If I could find £300 insurance I would have already bought a car

MoneySavingExpert.com has a reasonable article on how to get cheap car insurance.

The main insurers will aim to sell to the mass market, and may give higher quotes if you don't fit their ideal profile. In that case, it can help to contact a broker with experience of getting insurance for specific types of customer.

For example, this https://www.keithmichaels.co.uk/expat-car-insurance/info/hong-kong-driver-uk-car-insurance/
says

Here at Keith Michaels, we are a specialist motor insurance broker who provides bespoke schemes for customers who may not have a widely accepted insurance history in the UK. If you’ve emigrated from Hong Kong, our specialist expat team will assess your individual risk, and find a policy specifically for your needs.

You could also look for recommendations on forums for people in a similar situation, perhaps somewhere like https://www.hongkongers.org.uk/

If you do High mileage and have heavy depreciation, insurance and maintenance costs then 45p is not excessive.

Insurance costs more both for business use and for high mileage, and you cannot run a banger and maintain it yourself if you spend most of the time on the road.

It is generous if you do the occasional trip which does not affect your annual mileage much, though you still need to be careful about insurance.

Imagine someone doing 30.000 miles a year, getting 10 miles per litre at 1.70 , they would receive £13,500 mileage money, so

£13,500
-£5.100 petrol
-£0.700 Insurance
-£1,500, servicing, tyres etc.

Tyres and insurance costs cold well be understated.

£6,300, left with which to cover depreciation and any other costs, breakdowns AA membership or whatever, not that large amount, but this is not what the thread is about, someone doing relatively low mileage and not needing a high maintenance car can run a car much more cheaply.

Your employer can pay you anything they like. However, you will pay tax on any payments that are more than 45p/mile for the first 10,000 miles a year and 25p/mile more more miles than that. It has been at that rate since 2011. It was 40p/mile for the first 10,000 miles a year from 2002-2011.

Back then, it was enough to pay to buy a car like a Mondeo that would be sold after 3 years.

Cars and fuel have got a lot more expensive since then. For example, today, for 45p/mile total running costs for 10,000 miles a year for 3 years you could lease a Kia Rio https://www.fleetnews.co.uk/car-run...By=IsFleetPick&SortDesc=False&FuelType=petrol

 

[Harpers Tate]

In late 2017 I bought a brand new electric car. 2 years later, I part-exchanged it for a new one. In this case, therefore, I know precisely how much it cost in depreciation over those two years. In my case it was paid outright and the investment that was the source of those funds actually lost a tiny amount in value over the period so I have not included any interest in this calculation. However, someone with less capital may need to borrow, and account for interest. Note: upfront capital is not accountable; that's already accounted for in the depreciation figure.

Almost three years later certain costs may have increased and/or depreciation rates changed. Others' insurance rates will differ from mine. Impossible to estimate with any accuracy so for now and with those caveats, I have to base this on these known precise sums from 2+ years ago:

1: Depreciation £4730
2: Servicing £170
3: Fuel £365
4: Tax £0
5: Insurance £474
There were no other costs.

Total £5739 over 2 years. This is the "total cost of ownership and use" and is the only important factor - assuming one can actually raise finance.

Miles driven 18700.
Total cost per mile 30.7 pence. For up to 5 people travelling together.

Cost comparison allowing for all the above costs, from my local station for a day trip to Bridlington; two persons, no concessions on a Saturday:
156 miles round trip at 30.7ppm = £48
Two off peak day return train fares = £66 at today's prices. Would have been a shade less three years ago. Guess £60.

 

[hst43102]

This is just unimaginable.

In regard to South East v.s. elsewhere, the impression I have got from the forum is that the transport in the North is so bad. A single train cancellation can lead you to an hour of delay. Last trains run so early that it's not possible to use a train home after evening entertainment. The deregulated buses there are so expensive to use. These, in combination of the reduced job opportunities and the lack of facilities, I have already ruled out there as a place for me to live. Therefore, initially I only looked within the triangle bounded by Poole, London and Dover, and now after a year of complete dissatisfaction living in Bournemouth, I only look and budget within the triangle bounded by Hove, London and Dover, and get the conclusion that £30k is poverty wage, and all the numbers I have posted above.

I'm completely perplexed by this mindset. There is a lot more to the UK than just London and the surrounding area - and it's so much better!
I suppose I'm in a similar kind of demographic to you - a few years younger, but I've recently moved out of home in the south east (less than an hour's train from London) to Newcastle (a city in the north) and it's much better in every way than the area you have described. Plenty of decent jobs to go around - sure, they pay a little less than a similar job in London would, but only around 10-20% difference) and the living costs are MUCH cheaper than in the south east. Bus ticket for me is £25 per week, which is extremely reasonable and fits fine with my lifestyle at the moment. I'm hoping to get a car at some point in the near future, as I'm a young driver in a city I'm fully expecting it to be very expensive for the first few years but that should decrease quickly, and the cost will be worth it with the extra freedom and opportunities car ownership brings.
The biggest benefit to living in the north is the house prices - looking on Rightmove I can easily find a good few houses for under £60k within half an hour's drive of the city centre.
I know you've probably made up your mind to live in London, but have you actually even considered any alternatives? Your view of the entire country seems to be based off a handful of stereotypes about the North being a place with no jobs, no public transport, no social life and full of dirty people who talk funny. My experience - as a southerner - has been completely the opposite, so I'm not planning on moving back south any time soon!

 

[johncrossley]

I'm completely perplexed by this mindset. There is a lot more to the UK than just London and the surrounding area - and it's so much better!
I suppose I'm in a similar kind of demographic to you - a few years younger, but I've recently moved out of home in the south east (less than an hour's train from London) to Newcastle (a city in the north) and it's much better in every way than the area you have described. Plenty of decent jobs to go around - sure, they pay a little less than a similar job in London would, but only around 10-20% difference) and the living costs are MUCH cheaper than in the south east. Bus ticket for me is £25 per week, which is extremely reasonable and fits fine with my lifestyle at the moment. I'm hoping to get a car at some point in the near future, as I'm a young driver in a city I'm fully expecting it to be very expensive for the first few years but that should decrease quickly, and the cost will be worth it with the extra freedom and opportunities car ownership brings.
The biggest benefit to living in the north is the house prices - looking on Rightmove I can easily find a good few houses for under £60k within half an hour's drive of the city centre.
I know you've probably made up your mind to live in London, but have you actually even considered any alternatives? Your view of the entire country seems to be based off a handful of stereotypes about the North being a place with no jobs, no public transport, no social life and full of dirty people who talk funny. My experience - as a southerner - has been completely the opposite, so I'm not planning on moving back south any time soon!

He hated Bournemouth, which a lot of people consider a very desirable area. But it is a very expensive area (because it is desirable), comparable to the South East in cost yet without the benefits of being near London. Is he likely to find what he wants in the north if he can't find it in Bournemouth? Based on his many previous posts, I'm not sure. His requirement seems very exacting. From what I can make out, he has no ties to a particular region so I don't see what he would have to lose by living in Newcastle (for example) for a while, given the costs are so much lower.

 

[miklcct]

The biggest benefit to living in the north is the house prices - looking on Rightmove I can easily find a good few houses for under £60k within half an hour's drive of the city centre.
I know you've probably made up your mind to live in London, but have you actually even considered any alternatives? Your view of the entire country seems to be based off a handful of stereotypes about the North being a place with no jobs, no public transport, no social life and full of dirty people who talk funny. My experience - as a southerner - has been completely the opposite, so I'm not planning on moving back south any time soon!

£60k a good house?! Have you missed a 0 at the end? It's out of my imagination! Even in the very rural part of seaside Kent £60k can't even get me a flat! What city do you refer to? Is it somewhere without job opportunities?

Also you mentioned that it's half-hour drive to the city centre. Is it a rural road or motorway? How's the bus service along that road?

He hated Bournemouth, which a lot of people consider a very desirable area. But it is a very expensive area (because it is desirable), comparable to the South East in cost yet without the benefits of being near London. Is he likely to find what he wants in the north if he can't find it in Bournemouth? Based on his many previous posts, I'm not sure. His requirement seems very exacting. From what I can make out, he has no ties to a particular region so I don't see what he would have to lose by living in Newcastle (for example) for a while, given the costs are so much lower.

My requirements are follows, in no particular order:
1. good regional transport network
2. have job opportunities
3. close to a year-round lido
4. not far from low-cost airline airports
5. easy access to a seaside beach

Bournemouth only has 2 out of 5 (items 2 and 5).
Brighton has 4 (item 3 is missing).
London has 4 (item 5 is missing).
I don't think there is a place in the UK which has all 5, but it's possible in other countries.

So I decided whether a lido or a beach is more important for me in terms of my marathon swim training, and the answer was very clear that without a lido I can never get my swim training done properly, as evidenced by my life-regretting failure last year. So I choose London.

Most lidos are concentrated in London and in its commuter zone but there are also a few in the North. But I don't think they are located in places with good regional public transport, and not far from a good selection of low cost airlines for longer-distance travel as well.

 

[Speed43125]

Citroen C1

I'd consider just putting in the reg for various cars for a quote and not bothering too much about if it seems logical or not. Being in a similar position of looking for a car with 0 years NCB, stuff like a Citroen C3, Fiat Pandas and Puntos, Ford Fusion, or if your willing to buy even older, 1.4 Rover 25/45s are all relatively cheap. Other stuff I've come across that's cheap ish include various Volvos from around 20 years ago, various Renaults with the 1.5dCi engine. Equally Ford focus and fiesta are generally slightly more expensive to insure, but going for the Ghia trim (ie. least boy racer-y) seems to lower the cost somewhat. I've found the really obvious 'first car' style cars tend to be expensive to insure with loads of black box policies offered, same for cars that are value focused such as Skodas which seem to, I assume, attract an insurance company unfriendly demographic.

Try looking for Peugeot 107s and Toyota Argos as well since they are materially the same car, but insurance companies can be rather illogical with pricing.

Personally £1200-1800 is easily doable for car and insurance. The market ultimately dictates that cheap Insurance, purchase price and road tax is virtually impossible to find altogether however.

 

[johncrossley]

£60k a good house?! Have you missed a 0 at the end? It's out of my imagination! Even in the very rural part of seaside Kent £60k can't even get me a flat! What city do you refer to? Is it somewhere without job opportunities?

Did you look on Rightmove as suggested? The suggestion was within half an hour's drive from the city centre, so in the wider region, but even if you just pick 'Newcastle-upon-Tyne' as the search (so just the city itself), there are 118 properties under £80,000, albeit most of them flats or maisonettes. Some of them will be auction properties but most are not. It was also already mentioned that there are jobs. There is a light rail system there so there are even cheaper areas that are easily accessible from the city centre.

London has 4 (item 5 is missing).

If you live in Barking (a cheap part of East London), Leigh on Sea is about 30 minutes train ride away.

 

[hst43102]

£60k a good house?! Have you missed a 0 at the end? It's out of my imagination! Even in the very rural part of seaside Kent £60k can't even get me a flat! What city do you refer to? Is it somewhere without job opportunities?

Also you mentioned that it's half-hour drive to the city centre. Is it a rural road or motorway? How's the bus service along that road?




My requirements are follows, in no particular order:
1. good regional transport network
2. have job opportunities
3. close to a year-round lido
4. not far from low-cost airline airports
5. easy access to a seaside beach

Bournemouth only has 2 out of 5 (items 2 and 5).
Brighton has 4 (item 3 is missing).
London has 4 (item 5 is missing).
I don't think there is a place in the UK which has all 5, but it's possible in other countries.

So I decided whether a lido or a beach is more important for me in terms of my marathon swim training, and the answer was very clear that without a lido I can never get my swim training done properly, as evidenced by my life-regretting failure last year. So I choose London.

Most lidos are concentrated in London and in its commuter zone but there are also a few in the North. But I don't think they are located in places with good regional public transport, and not far from a good selection of low cost airlines for longer-distance travel as well.

Firstly, I didn't necessarily say you would get a good house for £60k. I'm renting my current place (with a few others in the house too) for £400 a month for a room in a huge Victorian terrace in the best area in Newcastle. If you're looking to rent you can easily find nice places for under £800 per month. £60k is about the minimum you can expect to pay for a decent one or two bedroom flat in the city itself, but looking a little further afield on Rightmove you can find two bedroom houses for as little as £35 - 40k in places like Easington and Peterlee, about 30 mins drive from Newcastle by car, 40 mins by train or just over an hour by bus. There's also the much closer but smaller city of Sunderland within 20 mins by bus or train. Of course, if you're paying less than £50k for a house you have to have low expectations and be prepared to spend a bit on making the house nice to live in, but if you're looking for an area with low living costs, it doesn't get much better than this!

In relation to your requirements, Newcastle has :
1. One of the best regional transport networks in the UK, the Metro is the second busiest urban rail network in the country and Newcastle station has direct trains to London, Edinburgh, York, Manchester, Liverpool, Birmingham, Bristol and other major places.
2. Plenty of good job opportunities in many different industries. "The North" got a bad reputation for having no jobs during the 1970's and 80's but the reality is very different today. Don't expect a London salary but as I stated the living costs are so much lower that you'll have a lot more savings and probably less commuting time.
3. Think this is the one requirement that Newcastle fails on. I don't think there are any lidos in the area but there are some excellent indoor pools.
4. Newcastle airport is around 15-20 mins from the city centre using the Metro. Flights go to at least 25 different destinations all over the UK and Europe.
5. Plenty of beaches along the coast - Whitley Bay, Tynemouth, South Shields, Roker, Seaham just to name a few. For a proper "seaside" experience, Scarborough is about 2 hour's drive away.

Of course, as you stated you're not going to be able to find somewhere that fits all of your categories. As you said here :

as evidenced by my life-regretting failure last year. So I choose London.

You don't want to regret another decision regarding a location to live in. Sure, London has its positives, but do the benefits outweigh the huge costs you have to pay for living so close to the city? I'm not trying to say that the North is perfect in any way - it has plenty of problems that you won't experience so much in London - but I think you might want to examine the other options available to you before making any big decisions about finding a place to live or buying a car (just realised that I've gone completely off topic here!). I think (please correct me if I'm wrong!) that you haven't really even considered that there is more to the UK than just London - based on the fact that you think that a house costs over £400k!

 

[Bletchleyite]

Just to clarify, was the life regretting failure a DNF (did not finish) on a sporting event?

If so, you are being too harsh on yourself. Learn from what went badly in that race and take your time to get to where you want to be.

 

[miklcct]

Just to clarify, was the life regretting failure a DNF (did not finish) on a sporting event?

If so, you are being too harsh on yourself. Learn from what went badly in that race and take your time to get to where you want to be.

Yes, but I don't want to talk about it anymore. I just want to know how can people afford a car given that the cost of living is so high, but if you are talking about £700- pcm rent or £150k- house price than the math easily works out on a typical £35k salary.

However, the above numbers can't be found where I'm looking at, i.e. London and South East, and in practice London and South East is the region where car dependence is the lowest as well.

 

[43066]

I suppose I'm in a similar kind of demographic to you - a few years younger, but I've recently moved out of home in the south east (less than an hour's train from London) to Newcastle (a city in the north) and it's much better in every way than the area you have described.

To be fair I completely get the costs argument but, unless you’ve done that as a student, or perhaps as a grad on a temporary placement with a lot of likeminded colleagues of a similar age/life stage, a lot of people would find it hard to move away from their existing family/social connections if they originated in London or the south east. That said I’m not sure whether @miklcct has many ties in Bournemouth.

Rightmove you can find two bedroom houses for as little as £35 - 40k in places like Easington and Peterlee, about 30 mins drive from Newcastle by car, 40 mins by train or just over an hour by bus. There's also the much closer but smaller city of Sunderland within 20 mins by bus or train. Of course, if you're paying less than £50k for a house you have to have low expectations and be prepared to spend a bit on making the house nice to live in, but if you're looking for an area with low living costs, it doesn't get much better than this!

I find it genuinely staggering that you can still buy houses in the U.K. outright for £50k. That’s a deposit in many parts of the South East!