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What car should you drive based on salary?
Whether you’re paying cash or financing, the purchase price of your car should be no more than 35\% of your annual income. If you’re financing a car, the total monthly amount you spend on transportation – your car payment, gas, car insurance, and maintenance – should be no more than 10\% of your gross monthly income.
How much should you spend on a car if you make 100K a year?
So, theoretically, if your salary is $50,000 you could afford a car payment of $430 or less. With a $100,000 salary, you could afford a mortgage payment of no more than $2,500. For those with a salary near $30,000 your home, car, and debt combine should be no more than $1,250 per month.
What car can I afford with my salary USA?
The rule of thumb among many car-buying experts dictates that your car payment should total no more than 15\% of your monthly net income, sometimes called your take-home pay (some might stretch this to 20\%, but 15\% is more conservative and therefore likely to make budgeting even easier).
How much car can you afford to buy?
The above car affordability calculator uses a conservative but solid assumption about how much car you can afford. Whether you’re paying cash or financing, the purchase price of your car should be no more than 35 percent of your annual income.
Is $70k a year a lot of money to have?
Probably not. At $70,000 a year, you have about $3,500 a month to play with after taxes. You can do a LOT with this money in terms of savings or investing if you are single. If you have a family, that $3,500 will go a little bit less far, but still, if you pick your housing, car and transp…
How much of your income should you spend on a car?
Probably not as much as you might think. You can spend between 10 and 50 percent of your gross annual income on a car. That’s a big range, we know, so if we had to set a rule, it would be this: Spend no more than 35 percent of your pre-tax annual income on a car.
How long should I get a car loan for?
Four years is the maximum most personal finance experts recommend. If you can swing paying off your car in three years, that’s even better. If you feel you absolutely must stretch your payments further, you could get a five year loan, but never longer.