Car Affordability Calculator (By Monthly Budget)
Affordability by Monthly Budget
Determine the max car price you can afford from your monthly budget
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Affordability by Income
Use the 20/4/10 rule to determine car affordability
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Formula
Max Loan = Payment x [(1+r)^n - 1] / [r(1+r)^n]
Frequently Asked Questions
What is the 20/4/10 rule for buying a car?
The 20/4/10 rule suggests putting at least 20% down, financing for no more than 4 years, and keeping total transportation costs (payment + insurance + gas) under 10% of gross monthly income.
How much of my income should go to a car payment?
Financial experts recommend keeping your car payment at or below 10-15% of your gross monthly income. The more conservative 10% target helps ensure room for insurance, gas, and maintenance costs.
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