How Much Car Can I Afford?

Find cars that fit your budget:

Car Trade in Tactics for Success (YAA Article):

🚗 Get educated on buying a car with YAA's NEW & IMPROVED Deal School 3.0:

💰 Save money on repairs and maintenance with a YAA+ membership:

🚗 Join the YAA Community:

🚗 Search for new and used cars:

🚗 Save thousands on a YAA extended warranty:

YAA Podcast: Daily News You Can Use

Ray and Zach dive into the process of figuring out just how much car you can buy with a pre-determined monthly payment. There's more variables at play here than you may realize, so grab a comfy chair, sit back, and soak in the knowledge!

[engineeringoyster]

Great video. As a 41 year engineer, I am always baffled by how many borrowers of money don’t understand the fundamentals of calculating loan payments. Particularly these days when do many on-line tools are available.

It is just math. And you don’t have to have it memorized these days.

[raycoleman]

Best video and advice I have seen so far. I have been a vocal critic of these guys, and for good reasons, but this video content is spot on. It rightly points out that the ‘buyer’ has an obligation to investigate and evaluate their financial position and capacity BEFORE they actually visit a dealership. NOT doing their ‘homework’ only leads to disappointment and dissatisfaction when their wishful thinking runs into financial reality. And, of course they then blame the dealer (known for ages as ‘killing the messenger).

[blackhillsrider]

Nice video. Yes credit unions are the way to go. Would never go 72 months. 60 months tops. My opinion.

[Ryan_DeWitt]

Unfortunately, a lot of people simply think "If I can make the monthly payment, I can afford it." That isn't always the case.

[sprague]

I feel for everyone who has to finance. Back in 2017 I decided I'd replace my 2004 Frontier in the summer of 2019. I had a $12000 down payment saved up. 2019 rolled around my old truck was still running fine so I figured I'd wait a couple of more years. Regardless, I started putting away the equivalent of an affordable car payment each month to add to my down payment fund, so I could afford something really nice. Then Covid hit and put the kabash on buying a vehicle in 2021! I now have $35000 and growing in my "down payment" fund. So as prices drop in 2023, I find myself in the position of paying cash up dealers are even accepting cash these days!). Sometimes, being a procrastinator has it's benefits.

[patriciacampbell]

Thank you so much Ray for doing this video and breaking it down so that I can get a better understanding of how much car I can afford.

[EATMAN]

FUNNY how most of the videos they show are pretty much repeats. yet still never emphasized enough.never gets old.

[marksmith]

Merry Christmas to you Ray and Zack! Thank you for sharing this! Mark in Iowa.

[Peter]

Your dad sounds like Vizzini from The Princess Bride. INCONCEIVABLE!!
I love your vids. Looking to buy later this year.

[Savvynomad]

Mortgaging a car is like mortgaging a house. Get a longer term loan if you are buying new, then make bigger payments as you go. The interest rate only applies to paying it at the time frame you took the loan for. If you pay double payments, you are paying a much lower interest rate.

[onelifelive]

I love your channel and do watch often! However, unless a new car manufacturer offers 0% percent there is no way in hell I would finance a car never mind for 72 months. You've said cash is KING as that's a payment I could only afford.

[billdog]

Great video guys. Years ago in a financial course it was mandatory to buy and use an HP12-C calculator. Basic financial calculator. Used it ever since. Saved me hundreds when one dealer told me an interest rate and payment, I ran the numbers backward, and sure enough the payment was using a rate that was 2 percentage points higher then the rate he verbally quoted (nationally advertised rate, no less). Sales rep acted confused, scratched his head, left and came back 2 minutes later and said "you're right", and changed the payment on the spot. Hate to say, you have to watch these folks like a hawk, and hold onto your money.

[jeremykeller]

It has come down to a choice: car or retirement. Choose the car? With its purchase price, registration fee, insurance and repairs, it will mean that you do not need to think about retirement. Your car has foreclosed on this option. Once, the Americans owned cars. Now, the cars own them.

[SoBlessed]

Your dad has so much wisdom. Please let him talk, geez!

[c-qc-q]

Here's the thing... (Auto Mfr) Marketing INTICE you to buy new, shiny, feature bloated cars... maybe that you don't need... 1) New Cars depreciate significantly as soon as you drive it off the lot. That's an implicit cost of buying a new car. 2) New Cars cost more to insure. Sometimes a lot. CALL/Talk to your auto insurance agent BEFORE you sign the purchase agreement.

YOU should take into consideration what is the monthly/annual OPERATIONAL cost of the car... including a gas/tires/oil changes/repair/insurance budget, and then decide if you can afford it. If you can't afford to buy a new car, buy a used car. If you can't afford to buy a used car, ride a bike or take the bus. If you can't ride a bike or bus, get a 2nd job. IF you're risk adverse or living on the edge, save up and pay cash instead of financing - don't FU your credit rating.

AT the end of the day, CARS are Transportation/Utility + EGO. So how much Ego can you Afford, or are willing to pay?
THAT's Life.

[GlennLaycock]

9:20 Well done - you do not care about payment when you walk in - none of the dealers business actually, how you end up paying for it. I should be like .. "okay how will be paying for this now?" You will know by the out the door whether you have to (or want to) tap into credit and a good feeling on the payment effects as you approach your limit. They often will push credit and such saying "well the car is less money if you finance through us" .. well write down the offer specs on that .. same with lease, write down the specs on that (including the buy out and ALL fees at that point).

[wmason]

It blows me away that people go in to dealerships not knowing this. Telling people to negotiate only the OTD price when they don't know how much OTD they can afford before they go.

[Sir_Meezy]

Long story short……you can afford anything with a bigger down payment.

[rhettmolitor]

I’d question why the 72 months and why so much down. I wouldn’t exceed 60 months and I’d finance over time and keep the cash in a high yield savings account. Keep it for emergencies or invest it, don’t sink it on a depreciating asset.

[MrJFunkSanchez]

How did you find a RAV4 Hybrid at MSRP. Stealershios out here in LA are asking $5-8K dealer markups.