Had a MK4 1.6 Golf for 10 years, loved it , sold it to a neighbors son and he's happy with it 1 year on, its done 150k now! bought a 1.4 MK5 kept it 2 months, guttless!!
trouble is, the road tax on the petrol golfs is mental the 1.4 is bad enough..... the diesel i just got is £130 a year the 1.4 is £180
if you can afford a merc you can afford to tax it though! we are talking a £1500 max car for running to the shops and work etc
One of the best cars we have ever had was a Ford Ka. Dead reliable and cheap as chips to run. It also had loads of room in the front, though the back seat is only suitable for small kids/midgets, and an absolute hoot to drive.
Get something you would like to drive [as a second car]then convince the wife you have done the sums...