How much money should you spend on a car?

Because it’s recommended you spend no more than 10% to 15% of your monthly after-tax income on your car payment, your monthly payment will significantly influence the kind of car you can afford. If your monthly take-home pay is $3,500, then that means that your car payment shouldn’t exceed $350 to $525.

How much car can you afford?

To determine how much car you can afford, financial experts recommend keeping your total monthly car payment at 10% or less of your gross monthly income, spending no more than 15% to 20% of your take-home pay on car expenses, and ensuring that total vehicle costs, including loan payments and insurance, don’t exceed 20% of your monthly income.

How much car can you afford with a $100,000 salary?

Based on those terms, a person making $100,000 a year can afford a $61,000 car, assuming their other expenses allow for a monthly payment of approximately $931.05. To buy a car that costs $50,000, you’ll need to make $80,000. Here’s a look at affordable monthly payments based on salary ranges. How Much Car Can I Afford With a 75K Salary?