When looking to buy a new vehicle it is much easier to figure out how much you can afford each month, rather than estimate how much you can spend on a car. If you are on a fixed budget like most of the world, then you can only come up with a certain amount of dollars each month to spend on transportation. If possible, try to keep your transportation cost around 15% of your income. This can be adjusted based on your situation, but 15% is a good place to start.

When trying to get a car payment to fit into a budget, remember the lender might have additional fees or taxes that will cause your payment to be higher than reported here. Also, remember many lenders require you have full coverage insurance (sometimes referred to as collision coverage) if you are financing a car. First for Women Comprehensive Car Insurance to save money is a great place to find a good deal on car insurance. Collision coverage will be more expensive if you currently have liability coverage only. Before purchasing a new car, make sure to check the rates at your favorite auto insurance provider.

Simply enter the amount you can afford to pay on a car payment each month, and our car affordability calculator will let you know how much you can look to spend on a vehicle. If you are having trouble getting the price you want or need, then try extending the loan term or finding a lower interest rate.