Convince me

[Kryton]

sorry to hear about the job loss.
The only good outcome from it is that it happened now and not after you had signed on the dotted line.
How much more of a worse position would have that put you in?

[DJM83]

Originally Posted by XR6_661

Scrap that guys.

Just got made redundant =(

How do you go from looking at a lease car for your a job to redundant in 3hrs?

[gtfpv]

i'm currently leasing . novated lease . i agree with most of the above posts . i've worked it out to getting a 100% loan , no deposit, interest free , and then paying about 80-85c per litre of petrol . then hopefully have around 4 to 5 k profit after selling after 3 years .
the pluses of this are , you sell whatever you own for whatever amount , and you have cash . before you lease . you should put that away for the end of the lease you can put it towards the residual .
very important to take out redundncy cover @ about $2 pw cover $10,000 shortfall to payout lease .
it is a commitment and it is your responsibility . it can backfire if you need to get out of it .
tips are . negotiate your own purchase . ( with a dealer)
take out redundancy cover .
insure for ( AGREED VALUE) dearer tham market value , but allows you to take cash payouts instead of replacement car , because if the car is written off or stolen , you need to pay out the lease ++ interest , which will add up to up to 20% more than you bought the car for .
lease for 2-3 years best outcome .
fianlly enjoy the car and look after it . you wont have to touch the car or worry about filling it up or repairs or breakdowns or maintenece ever again .
you can even get a replacement car included if the car is getting repaired or off the road .
you wont miss the money and will live on a lot less cash , its amazing what goes from your wallet to a private car .
finally consider this . #### example you have a 10 year old car with say 250k on it say an au fairmont . worth 5 k. you do 600km per week in it . you bought it 7 years ago for 20k net.
over 7 years you have lost $22 pw week + $20 rego + $20 insurance+ $40 maint +$70 petrol at the same time you were saving $60 pw towards your next 2 year old car. thats $232 a week net you have just spent on motering for the last 7 years .
you sell the car for 5k and add the 21k you saved towards it . thats $26k you have for a good ( hopefully ) 2nd hand G6E with 40kays on it ( chance chance chance)
your cars are consatntly 2nd hand from 2 to 10 years old cause your a smart buyer . and most of the work you've done yourself .
VERSUS a brand spanker XR6 for say $240 pw net nothing toworry about , and after 3 years you buy the car at a great price , or sell for a profit of $4k pocket the money AND GET ANOTHER NEWBY.

[JimNiki]

Originally Posted by gtfpv

i'm currently leasing . novated lease . i agree with most of the above posts . i've worked it out to getting a 100% loan , no deposit, interest free , and then paying about 80-85c per litre of petrol . then hopefully have around 4 to 5 k profit after selling after 3 years .
the pluses of this are , you sell whatever you own for whatever amount , and you have cash . before you lease . you should put that away for the end of the lease you can put it towards the residual .
very important to take out redundncy cover @ about $2 pw cover $10,000 shortfall to payout lease .
it is a commitment and it is your responsibility . it can backfire if you need to get out of it .
tips are . negotiate your own purchase . ( with a dealer)
take out redundancy cover .
insure for ( AGREED VALUE) dearer tham market value , but allows you to take cash payouts instead of replacement car , because if the car is written off or stolen , you need to pay out the lease ++ interest , which will add up to up to 20% more than you bought the car for .
lease for 2-3 years best outcome .
fianlly enjoy the car and look after it . you wont have to touch the car or worry about filling it up or repairs or breakdowns or maintenece ever again .
you can even get a replacement car included if the car is getting repaired or off the road .
you wont miss the money and will live on a lot less cash , its amazing what goes from your wallet to a private car .
finally consider this . #### example you have a 10 year old car with say 250k on it say an au fairmont . worth 5 k. you do 600km per week in it . you bought it 7 years ago for 20k net.
over 7 years you have lost $22 pw week + $20 rego + $20 insurance+ $40 maint +$70 petrol at the same time you were saving $60 pw towards your next 2 year old car. thats $232 a week net you have just spent on motering for the last 7 years .
you sell the car for 5k and add the 21k you saved towards it . thats $26k you have for a good ( hopefully ) 2nd hand G6E with 40kays on it ( chance chance chance)
your cars are consatntly 2nd hand from 2 to 10 years old cause your a smart buyer . and most of the work you've done yourself .
VERSUS a brand spanker XR6 for say $240 pw net nothing toworry about , and after 3 years you buy the car at a great price , or sell for a profit of $4k pocket the money AND GET ANOTHER NEWBY.

mate, you lost me at .... "i'm currently leasing"

[vanman_75]

the ks i do leaseplan is a good way to go ,i get it salary sacrificed though .4 weeks left on me patrol ...got10 above residual for trade so a bit of money back ...tax bill prevailing .

it does reduce your tax amongst other things and mod away as long as its legal you can do as you like ,either send the bill to them for your mods or wear the loss as you would any other car. bad news im buying a p p p prado this time , lifted ,chipped exhaust,tint ,bullbar ,and some muddies and mags.just gotta bolt the winch on lol now im rambleing ,ps sorry about your job .

[gtfpv]

Originally Posted by JimNiki

mate, you lost me at .... "i'm currently leasing"

WHY?

[Mr Brooksy]

I used to have a similar system to gtfpv that worked a treat! But we needed a V6 or I6 as we pulled a 5-700kg trailer with AV equipment all over NSW. But in 2003-4 when the price of fuel seemed to sky rocket (over the $1 mark) the bigger cars value fell through the floor.

We used to able to pick up a new BA XR6 for $31000, drive it for 4-9months putting no more than 15000km on it and take it back to the dealer, they'd give us $1000-$3000 for the car and then we'd start again. That would cover "On Road costs", and that's about it.

But since then, the lease agreements have changed, the predicted values (as has already been stated) from the lease companies makes this option more of a risk then it used to be... unless you have the car that 'everyone' wants at the end of your lease or someone (friend) who wants your car after your lease is over.

Its not a bad system if you can afford to loose a few grand each car you have, with the piece of mind that you'll have little to no issues with it (anything that need fixing will be done under warranty). But at the end of the day you pay a decent sum each month for a car you will never own.

And that's the thing people sometimes forget. Its no real difference to RENTING a house. If your in the same boat as the scenarios that Mr Hardware described, then it may be a safer bet to invest in your own car.

[Dave R]

Leasing vehicles has always been a mystery to me, no idea how it works or how you save.. I'm just not keen on the idea of not owning the car. Then again I purchased my car in cold hard cash which probably isn't the smartest thing to do either, being a Ford with their fantastic resale values.

Terrible luck being made redundant - but atleast you will receive a pay out and if you find another job relatively soon you can use the pay out to buy a new car!

Good luck.

[Revolver]

Originally Posted by XR6_661

I know my job is secure and I'm in for the long haul here.

Slighlty off topic, but when I read those words, the first thing I knew I was going to post was: No ones job is ever safe NO ONES! The ONLY exception is if you are in a Emergency Services or Military job. They can never have enough people, so unless you do something stupid, you wont be made redudant/retrenched/fired.

Then few posts down......

661, I believe you are in the drafting proffession arent you? You put up an image of something you mocked up in AutoCAD a few months back on another thread, so I guess you are. Im not sure how long youve been in the game (Me, 4 years). But drafting can be finicky, look at the past few years. Two of my bosses clients (big Australian builders) retrenched all their staff (drafting, estimating etc) except their salespeople in QLD, took their drafting work back in-house @ head office. We work in a booming in one minute, bankrupt the next industry mate, Ive been made redundant myself from the government drafting job I had.


Sorry about the redundancy, like i said, i have been in that position. Let me allow a gift for your redundacy: a peice on advice for you 661, in your newly found down-time, or for those reading this, Read: Rich Dad, Poor Dad, By Robert Kiyosaki. Buy it, borrow it, steal it if you have to. but Read it. Its a big eye opener for anyone who is employed, or self employed.

[naddis01]

Originally Posted by Adrenaline

Then again I purchased my car in cold hard cash which probably isn't the smartest thing to do either.

Thats better than getting a loan and paying interest on a depreciating asset.

[flappist]

Originally Posted by bfiipursuit

And how many lease companies actually come and inspect the vehicles?? LOL.

Bugger all.

How many drunk drivers or drug smugglers are actually caught?

All you need is to have a prang or get a non compliance notice and they will get a copy........

[Geez Louise]

Originally Posted by flappist

Bugger all.

How many drunk drivers or drug smugglers are actually caught?

All you need is to have a prang or get a non compliance notice and they will get a copy........

You've lost me. What does drink drivers or drug smugglers have to do with the OP's question about novated leasing??

[Revolver]

Originally Posted by Geez Louise

You've lost me. What does drink drivers or drug smugglers have to do with the OP's question about novated leasing??

Its in reference to making mods to the car, even though you dont own it & the chance of getting caught out by the company leasing the car.

[gtfpv]

Originally Posted by Adrenaline

Leasing vehicles has always been a mystery to me, no idea how it works or how you save.. I'm just not keen on the idea of not owning the car. Then again I purchased my car in cold hard cash which probably isn't the smartest thing to do either, being a Ford with their fantastic resale values.

Terrible luck being made redundant - but atleast you will receive a pay out and if you find another job relatively soon you can use the pay out to buy a new car!

Good luck.

trust me . as far as i know under a novated lease . you own the car . mine is registered in my name as a private vehicle . it is also insured in my name. any fines come to my house . if i get sacked or reduntant . the car does not get taken back , a bill will come to my doorstep. they have no interest in the car , its just a lease agreement . mods etc are not allowed without permission from them , thats the only ownership they have over it .
in reality the car is mine and a novated lease company has an interest in it ( in other words they are making money as a middle man out of my lease)

[JimNiki]

Originally Posted by gtfpv

trust me . as far as i know under a novated lease . you own the car . mine is registered in my name as a private vehicle . it is also insured in my name. any fines come to my house . if i get sacked or reduntant . the car does not get taken back , a bill will come to my doorstep. they have no interest in the car , its just a lease agreement . mods etc are not allowed without permission from them , thats the only ownership they have over it .
in reality the car is mine and a novated lease company has an interest in it ( in other words they are making money as a middle man out of my lease)

I agree with you as many are in that situation at my work.
Mine is a 100% company owned lease car, my mate's is a SSV ute on a 4 year lease. He's put a rad cam in it, a 3000 stally, hi performance valve springs which broke and detroyed the block. He went out and bought a 6l engine out of his own money (5K) and put the original TC back in... he seems nonplussed about doing mods to it...treats it like his own...
At the end of the day, if you pay the residual, is the lease company gonna make a big deal for the sake of it?...

I spose we can stretch the argument to apply to all of us with mortgages.
In my case, ANZ has my title, but I still treat it as my own?

[Springfield_Johny]

As I understand it, it reduces tax. Lets say you earn $1000 a week & pay 20% tax. That leaves $800. Your car repayment is $100, so you have $700 left.

A novated lease comes out of your gross salary (before tax) so with the above example

salary $1000
novated lease (car repayment $100)
gross income is then only $900 so the 20% tax is calculated on that ie $180, so your net income is $720.00

Or take my example, I currently drive an F truck every day, it costs me at least $200 a fortnight in fuel alone - let alone maintenance repairs, rego & insurance.

For $360 a fortnight I'm getting a new triton Turbo Deisel cab chassis, that includes all maintenance, insurance, rego and fuel. So for me - yes its worth it, by the time I figure I'm not paying $200 in fuel & $40 in insurance a fortnight, its costing me $120 a fortnight for a brand new vehicle that I don't have to pay rego on, don't have to pay services on, don't have to pay for fuel.

John

[JimNiki]

Originally Posted by Springfield_Johny

As I understand it, it reduces tax. Lets say you earn $1000 a week & pay 20% tax. That leaves $800. Your car repayment is $100, so you have $700 left.

A novated lease comes out of your gross salary (before tax) so with the above example

salary $1000
novated lease (car repayment $100)
gross income is then only $900 so the 20% tax is calculated on that ie $180, so your net income is $720.00

Or take my example, I currently drive an F truck every day, it costs me at least $200 a fortnight in fuel alone - let alone maintenance repairs, rego & insurance.

For $360 a fortnight I'm getting a new triton Turbo Deisel cab chassis, that includes all maintenance, insurance, rego and fuel. So for me - yes its worth it, by the time I figure I'm not paying $200 in fuel & $40 in insurance a fortnight, its costing me $120 a fortnight for a brand new vehicle that I don't have to pay rego on, don't have to pay services on, don't have to pay for fuel.

John

I luv them tritons...
please tell me (cause I get easily distracted with numbers) how much is this vehicle (complete with fuel, servicing, etc) costing you after the 4 year lease after all the tax returns and gains. cheers...

[charlie200]

my partner hade a Novated lease and sure it was great that the fuel and the likes were paid for,but when it came to rego,insurance and servicing you still have to pay the money upfront then the lease company will refund you the money,so you still have to come up with a fair whack of money.
She then decicded to get out of the loan early and when she got the payout figure the car which cost $34,000 onroad would cost her $47000 after 2 years of ownership,all for a car that you never really own.I cant see the benefit of it.

[gtfpv]

Originally Posted by charlie200

my partner hade a Novated lease and sure it was great that the fuel and the likes were paid for,but when it came to rego,insurance and servicing you still have to pay the money upfront then the lease company will refund you the money,so you still have to come up with a fair whack of money.
She then decicded to get out of the loan early and when she got the payout figure the car which cost $34,000 onroad would cost her $47000 after 2 years of ownership,all for a car that you never really own.I cant see the benefit of it.

thats heart wrencing . are you saying she had the car for 2 years and the payout figure was 47k ??? how long was the lease . please tell me 5 years.

[EB#]

Originally Posted by XR6_661

.....Comes as a big shock to me! Definatly didn't expect
it...Get a payout figure next week...In the mean time, looks like I'll be looking
for work!

Things like this often have a way of working out for the best...
Maybe with a decent payout a savings fund could be started for the next
car to be purchased outright....?? I reckon debt free is the best option !!
All the best with the job search mate.

[Rodp]

Originally Posted by charlie200

She then decicded to get out of the loan early and when she got the payout figure the car which cost $34,000 onroad would cost her $47000 after 2 years of ownership,all for a car that you never really own.I cant see the benefit of it.

CHP is much the same, got bit bad by that one when I had a Ghia on CHP.

The above is the reason I don't lease. Being a fickle car owner, I could be loving my car one week and the next I'll be changing it over for another. There probably is a marginal benefit for me considering I do ~40k business mileage pa but the deductions I get at tax time means instead of saving a few bucks every week throughout the year, I get a big wad of cash in July - and I like big wads.

[vanman_75]

Originally Posted by charlie200

my partner hade a Novated lease and sure it was great that the fuel and the likes were paid for,but when it came to rego,insurance and servicing you still have to pay the money upfront then the lease company will refund you the money,so you still have to come up with a fair whack of money.
She then decicded to get out of the loan early and when she got the payout figure the car which cost $34,000 onroad would cost her $47000 after 2 years of ownership,all for a car that you never really own.I cant see the benefit of it.

i dont know how that has happened ,bad lease company that is .

leaseplan only require you to sell your car and pay out the depreciated amount...i know i have an extra car in my drive way that i dont need . everyone is different in their tax and income amounts ... you earn what i do and drive more than 25 thou and it is impossible to do that with any other means of transport ... ask your taxman he will know .

[flappist]

The plot with any of these things is "work use".

If you think this is a way of getting a cheaper personal car because it is "pretax" money you are going to get a huge fright.


Novated lease will ALWAYS cost you lots more than private finance.

The gain is that if you are using your private car for work purposes (not just driving to and from work) and you are going to claim expenses off your PAYG income it can get very murky very quickly.
Novated leases make it more simple and wil ensure that you have the vehicle you require for the job kept operational and fed.

Putting it simply:

It only costs less if you use the car a lot.

If you use the car a lot (25,000-100,000 a year) then it will be worn out in a big hurry and you will need to replace it as it is a work car.

If you mod it and then break it you have a huge problem as you still have to pay for it as well as another vehicle to use for work while it is being fixed as well as possibly drawing the wrath of the the lease company. If their insurance policy (it is their car and they will be doing some fleet insurance deal) says "no mods whatsoever" and you have an oops (that may not be your fault but the other guy is not insured) the insurance will not pay and you will have an even bigger problem.

Almost all of these mobs normally specifiy ULP not PULP or 98 so you won't be getting as much "zoom" as you possibly might like.

[trippytaka]

Originally Posted by XR6_661

About a novated lease.

So I have the opportunity through work to purchase a new vehicle...

It's a lease arrangement where the car is in my name and the money for the car payment, regos, insurance, fuel (I get a fuel card) is deducted from my salary before I see my pay...

Seems like a pretty good system...and I know my job is secure and I'm in for the long haul here.

So, anyone done this that can list the pros and cons of the system?

I'd probably be looking at either an FG XR8 or XR6T....

All my family do it now that one of my accountant mates sat down and explained it. My sister saved thousands on her Mazda 3 by going through a novated lease.

[davez104]

Originally Posted by flappist

The plot with any of these things is "work use".

If you think this is a way of getting a cheaper personal car because it is "pretax" money you are going to get a huge fright.


Novated lease will ALWAYS cost you lots more than private finance.

The gain is that if you are using your private car for work purposes (not just driving to and from work) and you are going to claim expenses off your PAYG income it can get very murky very quickly.
Novated leases make it more simple and wil ensure that you have the vehicle you require for the job kept operational and fed.

Putting it simply:

It only costs less if you use the car a lot.

If you use the car a lot (25,000-100,000 a year) then it will be worn out in a big hurry and you will need to replace it as it is a work car.

If you mod it and then break it you have a huge problem as you still have to pay for it as well as another vehicle to use for work while it is being fixed as well as possibly drawing the wrath of the the lease company. If their insurance policy (it is their car and they will be doing some fleet insurance deal) says "no mods whatsoever" and you have an oops (that may not be your fault but the other guy is not insured) the insurance will not pay and you will have an even bigger problem.

Almost all of these mobs normally specifiy ULP not PULP or 98 so you won't be getting as much "zoom" as you possibly might like.

Can't agree, not for all situations anyway. I'm in the highest income tax bracket and travel over 40,000kms per year, putting me in the lowest fringe benefits bracket. I do these k's whether it's cheap or not. We have been leasing a BF XR8 for the last 2.5 years. For what it actually costs me every week, I couldn't pay for and run an older, second hand 6cyl car, let alone a new one. I might lose a little when it comes time to sell the car, as the used market for V8's is not too flash at the moment, but I think I'll still be in front. I can put whatever fuel I like in the car, all insurances and costs are paid for. I don't put a cent towards it apart from the pre tax payment and the fringe benefits.

Will I do it again? Hell yeah.

Dave.

[charlie200]

Originally Posted by gtfpv

thats heart wrencing . are you saying she had the car for 2 years and the payout figure was 47k ??? how long was the lease . please tell me 5 years.

No the payout figure was lower but thats what the car had cost her for two years after she paid the balloon payment and all the repayments,not including the mantainence money.
Lease was 5 years.

[charlie200]

Originally Posted by vanman_75

i dont know how that has happened ,bad lease company that is .

leaseplan only require you to sell your car and pay out the depreciated amount...i know i have an extra car in my drive way that i dont need . everyone is different in their tax and income amounts ... you earn what i do and drive more than 25 thou and it is impossible to do that with any other means of transport ... ask your taxman he will know .

She had to pay the final payout figure plus the balloon payment of $10,000.
The vehicle was a Subaru leased through B.M.W finance

[DTFRMONT]

I know with Leaseplan, they offer redundancy insurance, where you just hand the car back if you're made redundant, from memory it's not too much extra.

As stated previously, you'd really only want to salary sacrifice a car with good resale, such as Honda or Subaru. I was looking at doing this last year & decided against it. If you're after a Ford, it's proably better using normal finance, unless you're in the top tax bracket & doing a heap of business mileage.

[Springfield_Johny]

Originally Posted by JimNiki

I luv them tritons...
please tell me (cause I get easily distracted with numbers) how much is this vehicle (complete with fuel, servicing, etc) costing you after the 4 year lease after all the tax returns and gains. cheers...

You mean the residual I have to pay at the end?

[Springfield_Johny]

Originally Posted by JimNiki

I luv them tritons...
please tell me (cause I get easily distracted with numbers) how much is this vehicle (complete with fuel, servicing, etc) costing you after the 4 year lease after all the tax returns and gains. cheers...

You mean the residual I have to pay at the end?