A les­son in clas­sic car Fuzzer­nomics

Classic Car Weekly (UK) - - Your Letters -

Lis­ten, no English­man likes to talk about his fi­nan­cial dis­po­si­tion, and I’m no ex­cep­tion. But give me a six-fig­ure bank bal­ance, with­out the in­clu­sion of dec­i­mal points and I’ll be broad­cast­ing it from the rooftops. Don’t bother look­ing up just yet.

So, what I’d like to know is, how the blue blazes do folks af­ford new, or even rel­a­tively re­cent cars? I’d also like to add: Why bother? Al­right, I un­der­stand that our Western cul­ture’s dirty lit­tle se­cret is per­ma­credit; keep­ing our­selves in debt, while look­ing like high rollers, at least on the drive­way. And at this point, com­pany car types can zip your rips, as you’re too busy liv­ing the dream… for the time be­ing.

I’m no banker, al­though I’ve been called some­thing sim­i­lar, but, surely, get­ting in hock for £10k to £15k over the course of five years must leave a punter with a bill of around 20% APR per an­num. That’s a grand a year on your £15k loan, or there­abouts. Add to that the re­pay­ment of the ac­tual loan and that comes to some­thing like £333.33 per month. To many, that’s the same monthly amount as a 15-years-old mort­gage.

Dur­ing that time, the £15k car has plum­meted to around £5k in value and needs to be re­placed, but equiv­a­lent £15k cars are now £20k-plus and so the cy­cle con­tin­ues. Mean­while, in a par­al­lel uni­verse, or next door, a canny fam­ily has just bought a sub 100,000 miles, 10-yearold Ford Mon­deo es­tate for about £2k. In two-and-a-half years, to match the num­ber of kids, they’ll plough a sim­i­lar fur­row, al­though by this time, the equiv­a­lent car will prob­a­bly cost £2.5k.

So let’s make that £4.5k on buy­ing the daily driver over the next half decade and it’ll prob­a­bly hold a resid­ual value of £500 at sale time, so there’s a grand in the bank af­ter five years. Now we’re go­ing to con­vince our­selves that a loan is nor­mal.

There­fore, tak­ing out a £10k loan right now will buy a de­cent Tri­umph Vitesse. Keep the old tub in good or­der and it’ll prob­a­bly be worth at least the same, if not more, in five years’ time, which could work out to be the same amount as the loan re­pay­ments and you’ve had shed-loads of fun with it in the process. And you own it.

So, al­though a Mon­deo daily driver may not be to ev­ery­one’s tastes, it only need be used for anony­mous jour­neys, leav­ing the ‘Vitesse’ for high days and hol­i­days.

Please feel free to use the above, cod-sci­ence and poor math­e­mat­ics to jus­tify the pur­chase of a tasty clas­sic car of your choice for use over the next few years. You may end up quids-in.

Fuzz Townshend jug­gles a ca­reer writ­ing for CCW, run­ning a clas­sic car restora­tion work­shop and be­ing on the telly a lot.

‘Tak­ing out a £10k loan right now will buy a de­cent Tri­umph Vitesse’

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