PCP finance vs used? The modern car buying puzzle

There was a time when we'd buy our cars on hire purchase or with a bank loan, 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 Purchase 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. In effect, we've got used to funding the depreciation on our cars so we never actually own them.

It's an attractive proposition for many. For a fixed monthly fee, you can have a car that's always within warranty, never needs an MoT and could have servicing taken care of, too. What's not to like? Well, for starters, there's the cost, as you pay for the privelige of running a new car.

• Best new car deals 2016

To show you just how big that cost is, we've looked at what you'll typically pay annually when signing up to a PCP, and what you could buy outright in the same class for the same money. Of course, we're comparing a new car with one showing its age, so you need to take into account the fact that maintenance and fuel bills will be higher, as will road tax costs, over the period of ownership.

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But you won't have to worry about a deposit or about sticking to the mileage limits that come with PCP deals, and best of all, you'll be able to call the car your own.

Click the links below or to the side to see our pick of the cars you can grab for the price of a years finance payments...

Best used PCP alternatives:

• • City car/supermini: Seat Ibiza
• • Compact family car: Vauxhall Astra
• • Compact executive car: Audi A4
• • SUV/crossover: Toyota RAV4
• • MPV: Ford Galaxy
• • Sports car: Mazda MX-5

Now check out our sister site Buyacar for some great PCP car deals...