Is $900 a month too much for a car?

Yes, $900 a month is likely too much for most people's car payments; financial experts suggest your total car expenses (payment, gas, insurance, maintenance) shouldn't exceed 20% of your net income, with the payment itself ideally under 10-15% of your take-home pay, meaning you'd need a substantial income (around $5,000-$9,000/month after taxes) to comfortably afford $900 monthly.

Is a $900 car payment too much?

Financial experts recommend spending no more than 10% of your monthly take-home pay on your car payment and no more than 15% to 20% on total car costs such as gas, insurance and maintenance as well as the payment.

What is a good monthly price for a car?

A car's monthly cost varies, but generally, aim for your payment to be under 10-15% of your take-home pay, with total ownership costs (payment, insurance, gas, maintenance) under 20%, according to Bankrate and NerdWallet. Recent averages show new car payments around $748 and used around $532, but factor in significant extra costs like insurance (around $225/month for full coverage), gas, and repairs, which can add hundreds more. 

How much is too much for a monthly car payment?

Too much for a monthly car payment is generally considered anything over 10-15% of your take-home pay, with total car costs (payment, gas, insurance, maintenance) ideally under 20-25% of your net income, though personal factors like credit score and other debts matter; aim for a shorter loan, significant down payment, and low interest for better affordability. 

Is $1000 a month a lot for a car?

Yes, $1,000 a month is a significant car payment, often considered high, but it's becoming more common, especially for luxury or large vehicles, though affordability depends heavily on your income, with experts recommending 10-15% of take-home pay for the payment and 20% for total car expenses (gas, insurance, etc.). 

I Have A $900 Car Payment!!

How many people have $1000 car payments?

Nearly 20% of new-car shoppers have agreed to monthly payments of $1,000 or more in the second quarter of this year (between April and June), according to Edmunds' sales data. More borrowers — exceeding 22% — are opting for 84-month loans, which nearly doubled from six years ago.

What is Dave Ramsey's rule on cars?

Dave Ramsey's core car rules emphasize paying cash, buying used, and limiting total vehicle value to half your annual income, avoiding new cars unless you're a millionaire due to rapid depreciation. He stresses buying reliable, older used cars, getting them inspected by a mechanic, and never taking on debt for depreciating assets like cars, trucks, or RVs, focusing on financial freedom over looking wealthy. 

What's a good downpayment for a $20,000 car?

For a $20,000 car, a good down payment is around $2,000 (10%) for a used car, but aim for $4,000 (20%) or more if possible, especially for a new car, to secure better loan terms, lower monthly payments, and avoid going "upside-down" (owing more than the car's worth). The more you put down, the less you borrow, saving you money on interest and reducing risk. 

What's the smartest way to pay for a car?

The best way to pay for a car balances affordability and cost, often meaning a mix of significant cash (down payment) and a small, short-term loan (e.g., 3-5 years) to build credit without excessive interest. Paying all cash avoids interest but can be a huge upfront cost, while paying all cash at a dealer might cost more than if you financed. Leasing offers lower monthly payments but you don't own the car. 

What hidden car costs should I consider?

Beyond the monthly payment, you'll also face years of variable expenses like car insurance, gas, maintenance and taxes, which can spike without warning. By considering these costs before buying a new or used car, you'll be better prepared for the financial ups and downs of hidden car ownership costs.

What car can I afford making $3,000 a month?

Take-home pay is the amount you make each month after taxes, so if you bring home $3,000 monthly after taxes are deducted, it's likely you can comfortably afford a $300 car payment.

What is the average monthly car payment right now?

The average U.S. monthly car payment is around $748 for new cars and $532 for used cars, based on late 2025 data from Experian, though these figures can vary slightly by source. Payments are influenced by interest rates (higher for used), loan terms (around 69 months for new), and loan amounts ($42k+ for new). 

Is $700 a month a high car payment?

Yes, $700 a month is a high car payment, as it's around the average for a new car loan in late 2025, but whether it's "too high" depends on your budget, income (aim for under 15-20% of take-home pay), and if it includes insurance/gas; for many, it's a significant chunk of their monthly expenses. 

What's a good downpayment for a $30,000 car?

Down Payment

Because you've paid for part of the car with it, it lowers the amount of money you need to borrow and thus lowers your monthly loan payment. As a general rule, you should pay 20 percent of the price of the vehicle as a down payment. That's because vehicles lose value, or depreciate, rapidly.

What is the 8% rule when buying a car?

The 20/3/8 rule is a guideline that suggests you put 20% down on a car and repay the loan over three years. Applying the rule correctly will also require your monthly payment and car expenses be 8% or less of your income.

How much do dealerships usually want for a down payment?

If you can provide at least a 20% down payment, then you will be well-positioned to get approved for a vehicle loan. Not only that, there are some other benefits of providing a 20% down payment: Protects you from depreciation - As you own your vehicle, it will depreciate.

Is a 60 or 72 month car loan better?

Better interest rate: A 60-month loan will typically have a lower interest rate than a 72-month loan because the risk for lenders isn't as high. (Lenders consider long-term loans to be riskier because the longer it takes to pay off the loan, the more opportunity exists for the loan to not be paid back in full.)

What credit score is needed to buy a $20,000 car?

Generally, a good credit score for car financing falls between 670 and 739, based on FICO® Score standards — the scoring model most commonly used by lenders. However, it's important to keep in mind that not all lenders follow the exact same criteria.

What is the most financially smart way to buy a car?

How to make a financially savvy car purchase

• Choose wisely. Choose the make and model based on what you need. ...
• Set a budget. ...
• Make a big down payment. ...
• Look for sales. ...
• Shop around for the best loan. ...
• Cut down on interest. ...
• Make a deal. ...
• Keep saving.

Why Dave Ramsey says not to finance a car?

“Cars, trucks, RVs, boats, and everything that has motors and wheels go down in value,” Ramsey wrote recently. “NEVER finance them, because they go down in value and you get stuck in them. Don't let debt trap you in something that's losing value every day. Save up, pay cash, and own it outright.”

How much should I spend on a car if I make $60,000?

On a $60,000 salary, you can generally afford a car in the $20,000 to $30,000 range, with total monthly car expenses (payment, insurance, gas, maintenance) ideally staying under 15-20% of your take-home pay, which might be around $300-$450 for just the payment, though some say up to 35% of gross income for the total vehicle price. Key factors are your credit score, down payment (aim for 20% to avoid PMI and reduce interest), loan term (shorter is better), and other debts. 

Is it better to buy new or used with a loan?

It may be easier to secure a loan for a new car than it is for a used car, and new car loans often come with lower interest rates. Used cars can be a good fit if you're on a budget and they generally cost less to insure; however, interest rates for used car loans are often higher than for new car loans.

What is the best way to pay off a car loan?

Make Extra Payments

Paying Twice A Month: Making two payments that are more than your monthly bill will not only pay off the principal faster but will reduce accrued interest. Paying The Principal: Make payments that directly impact the overall cost of the vehicle instead of the interest rate.