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Buy new car or continue saving installment

Winston1990

Winston1990

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Looking for some guidance from financial savvy individuals:

Long story short:

I purchased my company Polo Vivo in 2016 at R72,000 with 108,000km on it. Drove it for just over a year and sold it for R90,000 after getting a good deal from VW on a trade in and a new 2017 Polo TSI. After discount and trade in of the Vivo, the new polo cost me R205,000 which I financed. I settled the car early after 3.5 years which was in Sep 2020. Ever since then I have been saving the installment amount each month.

I still drive the Polo which now has just over 80,000km on it and is in immaculate condition. I pay cash for services and maintenance on the vehicle and so far it has been cheap considering I save the installment and use that savings to cover the costs. I am also not concerned if anything goes on the car as I have a savings pool to cover such expenses and car parts are affordable on this vehicle - what I am trying to say is the fact that this car has no service, maintenance or warranty plan in place does not bother me.

At this point in time, including the saving on installments, I am saving around 28% of my take home salary every month. This is great as it helps to quickly build up savings and enables me to do other things - paid my lawyers fees on a second property I recently purchased, renovations on the property, serves as an emergency fund, and in general just provides peace of mind as I can save up quite quickly to either just save, or do / buy things I want to.

Here is where I am now:

Around 6 months ago I received a promotion at work. My job requires travelling around 50% of the time and sometimes it is long trips. I am an outdoor enthusiast who loves mountain biking and my partner and I do enjoy bush breakaways. The Polo has done the job so far as I had a towbar installed to drive around my mountain bike, but we have been limited with our weekend breakaways in the bush. The terrain usually dictates where we go. The Polo has also not felt like one of the safest vehicles in the sense of it being a high risk vehicle (The car itself and how it drives is not an issue).

I got offered a great deal to trade in my Polo on a new T-Cross - After trade in and discount I can get a new Comfortline T-Cross at R197,000 which I will need to finance. If I do decide to purchase the vehicle, I am considering a repayment period of 48 months. (Please note I am not looking for vehicle suggestions, If I am going to purchase a new vehicle it will be a T-Cross).

Pro's of getting a new T-Cross

  • Higher ground clearance with bigger wheels which will help with our bush breakaways
  • Bigger vehicle which will feel better on the road
  • The usual benefits of a new / more modern vehicle like cruise control, parking sensors, android auto etc. which my car currently does not have
  • Less of a high risk vehicle than a Polo

Con's of getting a new T-Cross

  • I will have a vehicle installment again for 4 years which diminishes my savings to 13% of my take home salary
  • Everything else which goes with saving less in a month

I am okay with driving the Polo for another 5 years as it is light on fuel and maintenance costs. I would obviously like a new T-Cross, but will it be the right decision hence me seeking guidance? Considering my line of work, lifestyle and current savings, is it worth getting the new vehicle or keeping my paid off vehicle and enduring the limitations of bush breakaways, driving a high risk vehicle etc. as it has worked for the last 5 years? Eventually I will probably need to replace the Polo....Might be in a year or could be 5 years. At this point in time there is a good offer on the table both for trading in the Polo and discount on the new T-Cross. In a year or 5 a new T-Cross or whatever I decide on then might cost a lot more and I will get a lot less for the Polo.

Please knock some sense into my mind!
 
Winston1990 said:
Looking for some guidance from financial savvy individuals:

Long story short:

I purchased my company Polo Vivo in 2016 at R72,000 with 108,000km on it. Drove it for just over a year and sold it for R90,000 after getting a good deal from VW on a trade in and a new 2017 Polo TSI. After discount and trade in of the Vivo, the new polo cost me R205,000 which I financed. I settled the car early after 3.5 years which was in Sep 2020. Ever since then I have been saving the installment amount each month.

I still drive the Polo which now has just over 80,000km on it and is in immaculate condition. I pay cash for services and maintenance on the vehicle and so far it has been cheap considering I save the installment and use that savings to cover the costs. I am also not concerned if anything goes on the car as I have a savings pool to cover such expenses and car parts are affordable on this vehicle - what I am trying to say is the fact that this car has no service, maintenance or warranty plan in place does not bother me.

At this point in time, including the saving on installments, I am saving around 28% of my take home salary every month. This is great as it helps to quickly build up savings and enables me to do other things - paid my lawyers fees on a second property I recently purchased, renovations on the property, serves as an emergency fund, and in general just provides peace of mind as I can save up quite quickly to either just save, or do / buy things I want to.

Here is where I am now:

Around 6 months ago I received a promotion at work. My job requires travelling around 50% of the time and sometimes it is long trips. I am an outdoor enthusiast who loves mountain biking and my partner and I do enjoy bush breakaways. The Polo has done the job so far as I had a towbar installed to drive around my mountain bike, but we have been limited with our weekend breakaways in the bush. The terrain usually dictates where we go. The Polo has also not felt like one of the safest vehicles in the sense of it being a high risk vehicle (The car itself and how it drives is not an issue).

I got offered a great deal to trade in my Polo on a new T-Cross - After trade in and discount I can get a new Comfortline T-Cross at R197,000 which I will need to finance. If I do decide to purchase the vehicle, I am considering a repayment period of 48 months. (Please note I am not looking for vehicle suggestions, If I am going to purchase a new vehicle it will be a T-Cross).

Pro's of getting a new T-Cross

  • Higher ground clearance with bigger wheels which will help with our bush breakaways
  • Bigger vehicle which will feel better on the road
  • The usual benefits of a new / more modern vehicle like cruise control, parking sensors, android auto etc. which my car currently does not have
  • Less of a high risk vehicle than a Polo

Con's of getting a new T-Cross

  • I will have a vehicle installment again for 4 years which diminishes my savings to 13% of my take home salary
  • Everything else which goes with saving less in a month

I am okay with driving the Polo for another 5 years as it is light on fuel and maintenance costs. I would obviously like a new T-Cross, but will it be the right decision hence me seeking guidance? Considering my line of work, lifestyle and current savings, is it worth getting the new vehicle or keeping my paid off vehicle and enduring the limitations of bush breakaways, driving a high risk vehicle etc. as it has worked for the last 5 years? Eventually I will probably need to replace the Polo....Might be in a year or could be 5 years. At this point in time there is a good offer on the table both for trading in the Polo and discount on the new T-Cross. In a year or 5 a new T-Cross or whatever I decide on then might cost a lot more and I will get a lot less for the Polo.

Please knock some sense into my mind!
Click to expand...
Sounds like the t-cross has a lot of nice-to-haves that you don’t really need.

How often do you go into the bush. If it’s not that often, why not just higher a vehicle for the getaway when you need something bigger / higher.

At the end of the day, depends how much you really want a new vehicle. Bear in mind, a new vehicle depreciates a lot more than a used vehicle. In a year or 5, the polo won’t be worth as much but so whatever you buyer. There will be something newer and more expensive.

Rather take a portion of the cash you save every month and go on more holidays, getaways. 80k km on a polo isn’t much.

Just my half a cent.
 
Another thing to consider is the difference in other monthly costs, fuel, insurance that type of thing. Is that included in the 13% saving take home calculation and how the decrease in savings would impact the amount of time you'd spend biking or going on bush break aways.

Also the Tcross sounds like it'll be significantly better vehicle for your job related driving which you do a significant portion of.

Can't say which is the best option but unless you're saving for something specifically I'd be leaning more to the Tcross although the Polo will still be a viable car for probably a long time.
 
keep the polo and drive it for a few years build cash reserves as interest rates on home loans wiĺl rise again plus job security means almost nothing these days tricky, what I'm saying is stick to polo, have cash reserves, hire a 4x4 for weekend get away get on credit card get ebucks or whatever....

I would do this....
 
Dont be fooled by vws marketing department, youll be buying essentially the same car that you have with some added tech goodies, not sure if its worth losing all that money just for some tech

The T cross is built on a polo 6 chassis (MQB A0) and barely has any ground clearance increase measured in at 15mm but the engine sits low on the chassis like any other polo so you still have risk of hitting the sump on a nice pointy rock (the ecosport is the wors offender here)

Also the tcross does not have 4motion available so if you are on your way to a mtb trail and things get sticky you are just as stuck as the polo as you also only have 2 front wheels pulling the car

And lastly, the whole bigger wheels, which is something i see on all the new suvs, they all have massive wheels but tyres with barely any sidewall, so while this looks imposing, its pretty useless off the beaten track. There is 16inch wheels on the base spec though with atleast a bit more sidewall but thats on the base spec model which i suspect you are not looking for

So to summarize the Tcross is simply a phat polo with shiny bits and in my opinion not a worthy swop for your polo considering the reason you want it
 
Stick to the Polo if it's doing what you need it to do at the moment, there's no need to get into debt when currently SA is in a mess and the future outlook is fairly bleak.
Any car is high risk these days.
 
Does the job have a car allowance or similar? Any tax benefits to financing a new vehicle?

I drive a 2007 Polo but low mileage because I don't commute far very often. Given the cost of servicing it versus car payments I'm saving a solid amount of cash a year (fuel bill is obviously lower so not much of a factor).

My wife though commutes between CT and Stellenbosch each day so we will be buying her a new vehicle to replace the Qashqai 1.6 as its servicing etc isn't cheap each year and fuel savings will be relevant to her use over the next few years. I compare the cost of whatever new vehicle we will get to those costs and also factor the fact that a new vehicle will hopefully be dependable and therefore safer to a woman commuting with kids sometimes (ie some things are worth paying for)

Run the numbers as best as possible and also try to factor anything you might foresee in the next few years too (job changes, family changes, job security etc)
 
I hear you with the breakaways and everything...maybe consider keeping the polo while saving up, bite the lip for a little while longer, and buy a 2nd hand bush vehicle that you can use for weekends without ramping up it's KM's

Then you have your transport for work in case something happens in the bush
 
Tough decision.

I second the comments about the t-cross not being that much of an upgrade in the 'bush vehicle' category and seriously consider hiring a vehicle if you go away - it may seem expensive, but take the depreciation and insurance costs of a new car into account and it isn't too bad. Hiring a vehicle is also optional - depreciation isn't.

One of the biggest costs with a new vehicle is the depreciation. Taking that cost into the equation is a sobering experience. On a new vehicle in that price range, annual depreciation of 20-30k is not unreasonable. Based on your promotion, if there is heavy usage, the depreciation will be even higher. Compared with the annual depreciation on your polo which will probably be <R5000/pa, you'll be saving a huge amount. Because most of the depreciation has already happened, every additional km that you add to the polo's odo will be cheaper.


So far, your approach to the car ownership is setting you up for accumulating wealth and significantly better quality of life. Having that cash reserve and safety net is amazing as it reduces stress. Don't succumb to the VW marketing team's sales process - there will be future 'deals'. If I was in your position, I'd seriously keep the polo for another 2 years and then re-evaluate. By then that t-cross will be about 50k cheaper and you'll have a lot more $$$ in the pocket.


I'm not joking about the depreciation. I was considering getting a mazda 3. The 2016 'Individual' spec level was about R332000 new (Mazda3 (2016) Specs & Price) and they are about R220k now (average of two listing on autotrader: Mazda Mazda3 cars for sale in South Africa). That works out at 110k depreciation over 6 years, or an average of 18k/year and the depreciation in the first 3 years was probably half of that R110k.
 
Get a nice 80 Series Land Cruiser, you can point to any mountain and be on top of it in a couple hours. Best thing is you can get a fully kitted one for R150-180K and it's a Toyota so you know you are buying reliability.

EDIT: I am not saying to sell your Polo for it, I am suggesting buying it as a second 'weekend only' vehicle as you are going to be paying through your ass for fuel but it is beyond worth it when you start properly using the vehicle
 
Keep the polo. Unless you’re looking at an SUV specifically like an Amarok from VW would be more suitable in your case. t-cross is not considered a worthy off road vehicle and I would suggest for you to buy a car cash seeing as though you’re very focused on life investments.

Don’t take on high repayments or more debt to cater for lower end entertainment.
 
JayDoubleYou said:
Get a nice 80 Series Land Cruiser, you can point to any mountain and be on top of it in a couple hours. Best thing is you can get a fully kitted one for R150-180K and it's a Toyota so you know you are buying reliability.

EDIT: I am not saying to sell your Polo for it, I am suggesting buying it as a second 'weekend only' vehicle as you are going to be paying through your ass for fuel but it is beyond worth it when you start properly using the vehicle
Click to expand...
Funny that, I am actually in the market for one (80 Series) but I can't find them anywhere...do you have any contacts?
 
T-cross is a joke, join the touareg club!

Mine purss like kitten and nothing stand in its way!
 
Cars are just a money sink. You drive it out of the show room and it loses 30% in value.

Right now the automotive world is on the pinnacle of moving away from ICE to BEV. I can see a lot of changes happening in the next 10 years. I would rather save by putting into the home loan and paying off any debt. (Assuming no high interest debt since you are thinking of a new car.) In a few years when BEVs are affordable, I'll get one.

PS: I have driven the Tesla Roadster, Nissan Leaf, Chev Volt, all awesome. Leaf is fav.
 
Winston1990 said:
Looking for some guidance from financial savvy individuals:

Long story short:

I purchased my company Polo Vivo in 2016 at R72,000 with 108,000km on it. Drove it for just over a year and sold it for R90,000 after getting a good deal from VW on a trade in and a new 2017 Polo TSI. After discount and trade in of the Vivo, the new polo cost me R205,000 which I financed. I settled the car early after 3.5 years which was in Sep 2020. Ever since then I have been saving the installment amount each month.

I still drive the Polo which now has just over 80,000km on it and is in immaculate condition. I pay cash for services and maintenance on the vehicle and so far it has been cheap considering I save the installment and use that savings to cover the costs. I am also not concerned if anything goes on the car as I have a savings pool to cover such expenses and car parts are affordable on this vehicle - what I am trying to say is the fact that this car has no service, maintenance or warranty plan in place does not bother me.

At this point in time, including the saving on installments, I am saving around 28% of my take home salary every month. This is great as it helps to quickly build up savings and enables me to do other things - paid my lawyers fees on a second property I recently purchased, renovations on the property, serves as an emergency fund, and in general just provides peace of mind as I can save up quite quickly to either just save, or do / buy things I want to.

Here is where I am now:

Around 6 months ago I received a promotion at work. My job requires travelling around 50% of the time and sometimes it is long trips. I am an outdoor enthusiast who loves mountain biking and my partner and I do enjoy bush breakaways. The Polo has done the job so far as I had a towbar installed to drive around my mountain bike, but we have been limited with our weekend breakaways in the bush. The terrain usually dictates where we go. The Polo has also not felt like one of the safest vehicles in the sense of it being a high risk vehicle (The car itself and how it drives is not an issue).

I got offered a great deal to trade in my Polo on a new T-Cross - After trade in and discount I can get a new Comfortline T-Cross at R197,000 which I will need to finance. If I do decide to purchase the vehicle, I am considering a repayment period of 48 months. (Please note I am not looking for vehicle suggestions, If I am going to purchase a new vehicle it will be a T-Cross).

Pro's of getting a new T-Cross

  • Higher ground clearance with bigger wheels which will help with our bush breakaways
  • Bigger vehicle which will feel better on the road
  • The usual benefits of a new / more modern vehicle like cruise control, parking sensors, android auto etc. which my car currently does not have
  • Less of a high risk vehicle than a Polo

Con's of getting a new T-Cross

  • I will have a vehicle installment again for 4 years which diminishes my savings to 13% of my take home salary
  • Everything else which goes with saving less in a month

I am okay with driving the Polo for another 5 years as it is light on fuel and maintenance costs. I would obviously like a new T-Cross, but will it be the right decision hence me seeking guidance? Considering my line of work, lifestyle and current savings, is it worth getting the new vehicle or keeping my paid off vehicle and enduring the limitations of bush breakaways, driving a high risk vehicle etc. as it has worked for the last 5 years? Eventually I will probably need to replace the Polo....Might be in a year or could be 5 years. At this point in time there is a good offer on the table both for trading in the Polo and discount on the new T-Cross. In a year or 5 a new T-Cross or whatever I decide on then might cost a lot more and I will get a lot less for the Polo.

Please knock some sense into my mind!
Click to expand...
Good evening, It sounds to me that you have an amazing ability to save money.

What's the point of saving if you dont get to life a little. the New polo cross is an amazing car, and if your willing to only save 13% for now, that's still not bad, considering that with a new car you get a maintenance plan and covers and will be saving on that too, so i do think you will still enjoy your bush breakaways even more with your new ride, and get to do a lot more, in a much better style.

Let us know what color your getting ;)
 
ELEMENTS said:
My adviced evening, It sounds to me that you have an amazing ability to save money.

What's the point of saving if you dont get to life a little. the New polo cross is an amazing car, and if your willing to only save 13% for now, that's still not bad, considering that with a new car you get a maintenance plan and covers and will be saving on that too, so i do think you will still enjoy your bush breakaways even more with your new ride, and get to do a lot more, in a much better style.

Let us know what color your getting ;)
Click to expand...
My advice is more in line with earlier posters, rather than this. The upgraded benefit of the T-cross is not worth the cost in my view. Keep the old car, keep saving your money (invest it where it can grow) and rent a proper trail vehicle when you want to hit the trails
 
adrcl said:
Get a duster
Click to expand...
s-zoom.file


And then...?
 
- You are buying a VW . Goldwagen and Vw parts is always full of customers . I wonder why when we go to Nissan and Toyota . The sales people in the parts are half asleep .

- Sell your car privately and take that money and money if you have saved and go and buy a reliable double cab for cash . That can run for the next many many years + no issues just service .

TO END
Yes you do live once , But one DAY when you old and wise you will release how much of your hard earned money you wasted on accounts making others rich .
At the end of the day we need something to get to point A to B . I am not saying don't buy something nice . But what I am saying is buy something reliable for cash and use the extra income to buy whatever else you want for cash .
 
Bloodlines said:
- I wonder why when we go to Nissan and Toyota . The sales people in the parts are half asleep .
Click to expand...

That would be because the customers are down the road at kotwals buying affordable parts...

PS. Goldwagen is not affiliated with VW dealerships.
 
ELEMENTS said:
What's the point of saving if you dont get to life a little.
Click to expand...
The guy said he does MTB.
That car repayment can pay for a couple of stage races per year, waaaaaay more memorable than having cruise control...
I agree with the rest, keep the Polo, personally I have a VW Up with my bike rack on the back and I rather spend that money on nice gear or a better bike, or doing a couple of lekker stage races throughout the year.

Also 13% might be a very low savings rate if you don't already have a nice pension pot in place, I would aim for 20% if you want to retire comfortably one day and enjoy cycling into your golden years.
 
Morning guys.

I don’t mean to derail this thread , but I bought a new car recently through Wesbank finance , and I was wondering if and how I could go about paying my car off sooner with cash deposits monthly? Do I do it with an app, or with a bank transfer with a certain reference code?

Also do you get penalties when doing so? ( I heard something like this a while back )

Thanks I’m advance . Oh and keep the polo.
 
Phone wesbank call centre. Give them your contract number or ID and they will be able to answer the question.
Just be aware, that some contracts actually impose penalties for early settlement, because the scummy financial institution loses out on interest charged.
 
BlueCrayon said:
Morning guys.

I don’t mean to derail this thread , but I bought a new car recently through Wesbank finance , and I was wondering if and how I could go about paying my car off sooner with cash deposits monthly? Do I do it with an app, or with a bank transfer with a certain reference code?

Also do you get penalties when doing so? ( I heard something like this a while back )

Thanks I’m advance . Oh and keep the polo.
Click to expand...
If you were able to pay more why did you not just shorten the term?
 
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