Nearly three-quarters (74%) of car owners over 55 bought their car outright without using finance, compared to half (54%) of 34 – 54 years and a third (33%) of under 34s, according to a survey of over 2,000 UK drivers.
On average, three-fifths (62%) of cars were bought outright via cash or debit card, 8% using personal contract purchase (PCP), 7% were bought on hire purchase, 5% loan from a bank, 4% on lease and 4% privately arranged finance. 3% had finance but were not sure what type, 3% paid by credit card, 3% were given as a gift, and 1% had a loan from friends or family.
The Opinium survey, commissioned by InsuretheGap, an independent provider of GAP (Guaranteed Asset Protection) car insurance, finds that 14% of under 34s use a PCP to finance a car purchase, compared to just 7% of over 55s, and 9% of 35 – 54 years.
South West England is the region most likely to buy a car outright (78%), followed by the East of England (71%), compared to Wales (66%) and Scotland (59%). Londoners are the least likely to (44%).
Ben Wooltorton, Chief Operating Officer of InsuretheGap.com, said, “However people buy their car, whether outright, finance, or loan, buying a car is one of the biggest purchases most people make, and drivers should consider how to protect their investment.
“Cars depreciate quickly, and if a car is written off or stolen, insurance companies will only pay the value of the car at the time of the incident, not the amount that was originally paid for it. Policies from InsuretheGap.com can protect drivers from this, and cost a fraction of those sold by the car dealerships.”