OneTaskBy Tim King · Updated
Car Affordability Calculator
How Much Car Can I Afford?
OneTask is free, with no sign-up, and built by one person.
If this tool saved you time, a coffee helps keep new ones coming.
How the Car Affordability Calculator works
This car affordability calculator answers how much car you can afford. It takes a share of your income as the monthly car budget, subtracts running costs, turns what is left into the largest loan you can repay, and adds your deposit and trade-in to give a price.
How the car affordability calculator works
A common guide is the 20/4/10 rule: put down at least 20%, borrow for no more than 4 years, and keep the total monthly cost of the car under 10% of your gross income. The page uses the loan formula backwards: loan = payment × (1 − (1 + r)^−n) ÷ r, where r is the monthly rate and n the number of months. The car price is the loan plus your deposit and trade-in.
First example. On $90,000 a year, 10% is $750 a month. Take off $300 of running costs and $450 is left for the loan. Over 4 years at 7.5% that repays $18,611, so with a $5,000 deposit you can afford a $23,611 car and pay $2,989 in interest.
Second example. On $6,000 a month with 15% for the car, $400 running costs and a 5-year loan at 6%, the $500 left repays $25,863. Add $3,000 down and a $4,000 trade-in and the budget is $32,863.
How many years should a car loan be? Four or fewer keeps interest low and helps you avoid owing more than the car is worth. Longer terms lower the payment but cost more and leave you upside down for longer, because cars lose value fastest in the first few years.
Car budget by gross annual income: 10% of income over a 4-year loan at 7%, compared with 15% over 5 years (no running costs deducted)
| Annual income | 10% a month | Loan, 4 years at 7% | Price with 20% down | 15% a month, 5-year loan at 7% |
|---|---|---|---|---|
| $20,000 | $167 | $6,960 | $8,700 | $12,625 |
| $30,000 | $250 | $10,440 | $13,050 | $18,938 |
| $40,000 | $333 | $13,920 | $17,400 | $25,251 |
| $50,000 | $417 | $17,400 | $21,750 | $31,564 |
| $60,000 | $500 | $20,880 | $26,100 | $37,876 |
| $70,000 | $583 | $24,360 | $30,450 | $44,189 |
| $80,000 | $667 | $27,840 | $34,800 | $50,502 |
| $90,000 | $750 | $31,320 | $39,150 | $56,815 |
| $100,000 | $833 | $34,800 | $43,500 | $63,127 |
| $110,000 | $917 | $38,280 | $47,850 | $69,440 |
| $120,000 | $1,000 | $41,760 | $52,200 | $75,753 |
| $130,000 | $1,083 | $45,240 | $56,550 | $82,066 |
| $140,000 | $1,167 | $48,720 | $60,900 | $88,378 |
| $150,000 | $1,250 | $52,200 | $65,250 | $94,691 |
| $160,000 | $1,333 | $55,680 | $69,600 | $101,004 |
| $170,000 | $1,417 | $59,160 | $73,950 | $107,317 |
| $180,000 | $1,500 | $62,640 | $78,300 | $113,629 |
| $190,000 | $1,583 | $66,120 | $82,650 | $119,942 |
| $200,000 | $1,667 | $69,600 | $87,000 | $126,255 |
| $210,000 | $1,750 | $73,080 | $91,350 | $132,568 |
| $220,000 | $1,833 | $76,560 | $95,700 | $138,880 |
FAQ
How much car can I afford on my salary?
A cautious guide is 10% of gross income a month for all car costs, so $60,000 a year supports about $500 a month. After running costs that might cover a loan of $10,000 to $15,000 over four years.
What is the 20/4/10 rule for buying a car?
Put down at least 20% of the price, finance for no more than four years, and keep the total monthly cost, including insurance and fuel, under 10% of gross income. It keeps a car from crowding out savings.
Should I include insurance and fuel in the budget?
Yes. Running costs are often as large as the loan payment, and leaving them out is the usual reason a car feels unaffordable later. Enter insurance, fuel, registration and servicing as a monthly average.
Is it better to put more money down?
A larger deposit lowers the loan, the payment and the interest, and protects you from owing more than the car is worth. Keep an emergency fund aside first, though, rather than putting every dollar into the car.
Does this include tax and registration fees?
No. Sales tax, stamp duty and on-road fees vary by place, so the price shown is what your loan and deposit cover in total. If those costs are added at purchase, take them off the result to find the car's price.
See also: all Loans & Savings tools, Everyday Maths, Dates & Time, Health, Home & DIY, Unit Converters, Education, Science, Creative, Garden & Farm, Gaming & PC, Work & Business, Fun, Maps & GPS, DIY & Building, Cost Estimators, Sport & Clubs.
Related tools
Loan Repayment Calculator
Car and personal loan repayments, and what a flat rate really costs.
Lease Vs Buy Calculator
Net cost of leasing a car versus buying on finance over the same term.
Car Depreciation Calculator
Future car value and depreciation cost per year and per km.
Fuel Cost Calculator
Trip fuel cost from distance, your car's economy and the pump price.
Compound Interest Calculator
Growth on a balance, with regular contributions and the real rate.