How Personal Contract Plans (PCPs) work
There was a time when we’d buy our cars on hire purchase or with a loan, over a series of years, and once it was paid for we would probably start the process all over again. But nowadays, thanks to the rise of the Personal Contract Plan (PCP), we don’t even wait until we’ve paid for our car – we just hand it back after three years (or even less) and get a new one. It’s an attractive proposition for many. For a fixed monthly fee we can have a car that’s always covered by a warranty, never needs an MoT and might have all of the servicing taken care of too. What’s not to like? The simple answer is – more than you might expect. It’s like perpetually renting a home rather than buying one. You could view it as dead money or as a way of enjoying hassle-free car ownership. It’s not the cheapest option but only you can decide if it’s worth the cost.