I'd like to work out how much a novated lease would cost me compared to just buying outright. All the leasing companies calculators show you "how much you would save" which hides a bunch of factors. I was going to make my own spreadsheet but I imagine someone has done this already: care to share me in on your wondrous Google Sheet and pay it forward?
Does Anyone Have a Novated Lease Calculator Spreadsheet?
gwong on 08/04/2019 - 17:14
Comments
No I don't, but consultants that have them normally charge for their services
Wow, a neg for other consultants (namely finance brokers) charging for use of their work… yeah well done
No I don't, but you're right about the leasing companies misleading. When I entered my lease, I put down that I would do a lot more km's per year than I actually do, figuring it would give me a buffer in my expenses. I kept well below the number of km's, yet i was constantly in the negative with my expenses. They made me increase my payments twice in a month, or they were going to revoke my motorpass. They couldn't explain to me why it was costing me significantly more than quoted even though I was doing less km's.
The best least is a 1yr lease. Period. Then extend one year at a time if you really don't want to buy it outright.
Check another thread someone had about an AMA on novated leases. It's very good.Yeah I just found that and realised the calculations were easier than I thought: their interest rate means nothing, like they said in that thread. They said the rate was 10.9% (!) but really it is about just calculating how much they are charging on loan costs + the residual then taking that away from the vehicle cost. Not that hard.
https://www.ozbargain.com.au/node/447589
I had thought that it wasn't worth it to NL at all if you have the cash to buy outright, but looking at it now I can see that it could be work it but only if you do 1 year I guess. I'm also looking into a company that sets up the self-managing.
Calculations can be simplified for an approximate calculation.
bc = Base cost of car before GST
pt = bc * 0.2 (20% of base cost is what you pay post tax + gst)
expenses = interest, principal, running costs, rego, repairs, fuel (excluding GST)pay1 = pretax salary
tx = a function that that returns a number which is the input minus the tax (and medicare levy) payable.Your in pocket salary annually then becomes:
tx(pay1 - (expenses - pt)) - (pt * 1.1)Notes:
- I think you pay GST on pt.
- the Principal you pay depends on the residual which depends on the length of the lease
- above calculation is annually.
- bc: I cant remember if it includes the initial rego or not. thereabouts.Done.
NB: I am not in any way qualified to give advice. I may be wrong in my simplification above.
Could you give some examples as to why a one year lease is the best (say, one year vs two)? I'm looking into a NL at some point (perhaps later this year).
It is best in terms of paying more pretax. (So more savings)
It is best in terms of liability when you lose your job or can't continue the lease.
It's the worst in terms of cashflow as it costs you more per month
Yes.
I can work it out for you if you send me a photo of the quote
No i don't, sorry.