Car Affordability Calculator

Find out how much car you can realistically afford based on your income, savings and monthly budget.

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Max Car Price
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20/4/10 Rule Check

About the Car Affordability Calculator

This calculator helps you find a car price that fits your real financial situation — not just the maximum a lender might approve. It works from two directions: your maximum monthly budget (reverse-engineered to a car price) and the classic 20/4/10 affordability rule, so you can see whether your budget is comfortable or a stretch.

What is the 20/4/10 rule?

The 20/4/10 rule is a widely-used personal finance guideline for car buying: put at least 20% down, finance for no longer than 4 years (48 months), and keep total monthly car costs (payment + insurance) under 10% of your gross monthly income. Meeting all three criteria is a strong sign the car is genuinely affordable for you.

How is the max car price calculated?

The calculator works backwards from your maximum monthly payment. Using your loan rate and term, it solves for the loan principal that produces that payment, then adds your down payment and trade-in to arrive at the maximum car price you can afford within your budget.

Should I use the maximum I can afford?

Not necessarily. The result is a ceiling, not a target. Buying below your maximum leaves room for unexpected repairs, insurance increases, and other financial goals. Many financial advisors suggest targeting 80% of your maximum affordable price as a comfortable budget.

Frequently Asked Questions

What is the 20/4/10 rule for buying a car?
Put at least 20% down, finance for no more than 4 years, and keep total car costs (payment + insurance) under 10% of gross monthly income. Meeting all three is a sign the purchase is comfortably within your means.
How much of my income should go to a car?
A common guideline is to spend no more than 10–15% of your gross monthly income on car payments. Including insurance and running costs, keep total car expenses under 20% of take-home pay.
What is a good monthly car payment?
A good car payment is one that fits comfortably in your budget without crowding out savings or other goals. As a rule of thumb, keep it under 10% of your gross monthly income.
Should I use the maximum loan amount I qualify for?
No. Lenders often approve more than is financially wise. Use this calculator to find a payment that fits your actual budget — not just what you qualify for.
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