Lease is ending - what to do?

[Batman105E]

Hey everyone...

My wife gets the choice of either a car allowance for leasing a car or a company car, or the cash equivalent with her job.

The lease on our MB TDCI Titanium Mondeo, which is in excellent condition and travelled 85,000ks is about to end and we have some decisions to make.

1. We could sell the Mondeo and lease another new car, however the tax benefits of leasing no longer apply and it is not worth it in my opinion.

2. We could sell the Mondeo and get the company car - Holden Commodore, we would rather walk than drive a Holden product all the time.

3. Pay out the balloon payment and keep the cash equivalent. The kicker here is that the balloon payment is only $13,300.

What would you do? Given it is only 3 years old and how happy we are with the car I think the decision is pretty easy. Happy to hear your thoughts.

[MrEL]

If you happy with the car and its a good thing , hang onto it , take the money and run.

[ian b]

In the same position, lease expires end of October so might wait to see if we get Kevin or Tony ruining our lives as one will keep the FBT changes and hopefully the other with return the status quo if he gets in.
Also not keen to go from T5 to ecoboost, interested on any opinions from some-one who has driven both for a period of time. Renewing the current lease is also much less than taking a new vehicle. Looking at taking out extended Ford factory warranty to avoid any surprises as the car gets older, although with only 45k on the clock it is still a newish car.
Other challenge is that I need new tyres so wary of spending $800, then trade 2 months later.
Residual is 19k so if FBT changes are implimented then may be worth paying the balloon payment, and get the warranty as well.
Pity the Fusion is still 18 months or so away as then no doubt what I would do.

[trentski]

easy decision, if you get unlimited use of the company car then get that, sell the mondeo and put the cash on your mortgage

[Batman105E]

Originally Posted by trentski

easy decision, if you get unlimited use of the company car then get that, sell the mondeo and put the cash on your mortgage

If you take the company car you don't get the cash. it is an either deal not both unfortunately.

[GK]

A 3 year old Titanium diesel for under 14K = No Brainer!

Enjoy!

GK

[allanv6gt]

Option 3........
Been there myself 2 months ago. End of lease was rolling around and nothing really on the market that is an equvalent for the price.
(XR5T with 6spd manual - auto free zone !!)

If you were not stuck with the Commodore company car as the alternative,
.....and if the leasing rules were as before the latest changes
.....I still think you would be hard pressed to find an equivalent replacement on a bang-for-buck measure.

Could have some fun wasting some time looking 'tho ......

[jaskel]

take the commy, the VF is a nice car.

Im in the market for a mondeo for the mrs, how much u sell it to me for?

[Ducati888]

A fully maintained company car, with free fuel, and you are asking what to do?

There is no way you can do the maths where any other option is better than a free car.

Been there, done that.

[Batman105E]

Originally Posted by Ducati888

A fully maintained company car, with free fuel, and you are asking what to do?

There is no way you can do the maths where any other option is better than a free car.

Been there, done that.

Probably but I look at it this way...

The company car is not free, you get either a company car, a lease or cash equivalent to the value of $2300/ month. The company car isn't free!

Monthly lease cash equivalent (before tax) is $2300, or about $1220 after tax.

Rego and insurance $230/month
Fuel $200/month
Tyres $75/month
Servicing $50/month
Extras $50/month

That leaves $600/ month in our pocket. Sure we have to buy the lease out with a balloon payment which is $13300, but that is way below wholesale. You won't buy a Titanium TDCI 2010 Mondeo anywhere for that, and who would want to drive a pov pack commodore around all day? Certainly not me and definitely not my missus.

Finally if she loses her job (you never know nowadays in manufacturing businesses) or she gets a another job that doesn't have a car provided we need to buy another car anyway.

[mendyxr6]

Take the cash and get a $1500 ef/el wagon off gumtree.

[nstg8a]

Originally Posted by mendyxr6

Take the cash and get a $1500 ef/el wagon off gumtree.

Err, that is not a great idea...

Go from a modern efficient safe car, to an old unreliable unsafe car?

IMO its a no brainer, pay out the mondeo and keep it. As said its too good a car not to keep it.

[allanv6gt]

Re $$$ comments just above......

The 'free' car is aprt of your Total On Cost (TOC) for your salary,includes super etc.
If you lease a car, it will be a novated lease, which means you get hit for FBT.

Under the previous most recent rules, this was 20% of the purchase price, regardless of your mileage. So, with a pov-pack Commodore @ say $35k , you'd be up for $7000 FBT per annum (or $583 per month) on full 'personal' use....in after tax dollars. This could be reduced by 'business miles % of total miles', but you will need to track and justify them (see your accountant for this one).
And simply extending/renewing your lease doesn't change that FBT figure down. It was (in 2006) still charged at the original purchase price, not the residual that might be due at renewal time. But see your accountant to confirm this under current rules.

So, unless you are doing enough miles and other running costs to rack up the expenses, leasing is now much less attractive than it was before.

And....... a $1500 ef/el wagon doesn't have to be unsafe, but I would agree it is certainly not as nice as something more modern.

[mik]

wait until after the election and look at your options again ?