How Much Car Can I Afford? Calculate Your Car Affordability like a Pro!

Learn how to calculate your car affordability like a pro with my easy-to-follow tutorial. Discover the 20/4/10 rule, understand car leases, explore the 3 secrets to successful car shopping, and gain insights into optimizing your budget for a stress-free car buying experience. Join the community of savvy millennial shoppers and subscribe to the channel for more financial tips and tricks!

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My favorite FREE car insurance quote comparison tool:
EXPERIAN®, FOR AUTO INSURANCE

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📝CHECK OUT THE HOW TO CONTROL YOUR SPENDING WORKBOOK

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[SpellFinder]

$80 a month for car insurance would be a dream. Where I live the cheapest I can go for one car is $180 a month. That’s with a good driving record and all discounts I can get. I tried shopping around when I went to renew and the next cheapest would have been at least triple the cost. Except for the costly insurance, I did put 25% down and I am on track to pay off the car a year early on my 4 year loan. I’m up for a promotion I hope to put the extra income towards paying off the loan even faster!

[TwilightedForever]

You used an interest rate of 4.37% for a car loan. How is that even attainable in the current market?

Just google "current interest rates for car loans" and the results show interest rates on car loans -- both New and Used cars -- are currently 6.6% - 12%
🤔🤔🤔

[electricpenguin]

It’s such a crazy time right now for car prices. I know you said cars always depreciate and I’m sure that should be true, but I recently had a weird experience. I purchased a used 2011 Toyota Corolla back in 2015 for 11k. Unfortunately this car was totaled in a hit and run accident (person was actually caught an hour later) this March. My insurance paid out 14k for my 12 year old car that I held for 8 of those years!

[karenh.]

Can you do a video on negotiating while pay for a car cash?

[vulpixelful]

Car insurance, registration, and gas should not be included in the 10 percent. The point of the 20/4/10 rule is to stay on the right side of the depreciation curve. Gas and admin costs do not help you do that.

Instead, those costs should be considered fixed costs like you would include in a separate needs/wants/savings ratio like 50/30/20.

Being conservative by choice is obviously fine, but a realistic budget for the average person would still keep them within their means.

[markbidwell]

@7:01 - Betterment, whom i have been making use of since my son was born, currently has a 4.50% high yield savings account - they have been very nice about any questions, deposits, withdrawals (as they should be)

[caro]

Do you buy gap insurance for your cars? I have a big fear of spending all of that cash and then totaling the car in an accident. I worry that I wouldn’t get back from insurance accurate value on the car.
I understand that I would already be saving for the next car but I feel that I would come up short to replace the totaled vehicle.
Is there a recommendation that I could follow to help ease my mind?

[judithbuchanan]

Great video Justine but I’m missing the beers 🍺 & budgeting videos 😆.

[anniegoomes]

Can’t imagine paying 1/3 of my income on a car! I’m on 100k upgraded to a 5K car from a 2k car and thought it was a lot to spend

[goldrush]

10%!!!! Holy crap. My mortgage is only 8% of my take home. Of course that is the only loan I have. No auto loan, cc, personal. Almost debt free. Cash is king.