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The frugal rule: **10% of income**

For many people, I think that will be between 10–15% of your income. So if you earn $25,000 a year, that's going to be a high-mileage used car for $2,500–$3,000. If you earn $80,000, that's a used car for around $10,000 or $12,000.
- 2019 Ford Fiesta. Starting MSRP: $14,260. ...
- 2019 Chevrolet Cruze. Starting MSRP: $17,995. ...
- 2019 Nissan Frontier. Starting MSRP: $18,990. ...
- 2019 Honda Civic. Starting MSRP: $19,450. ...
- 2019 Fiat 500. ...
- 2019 Ford Fusion S. ...
- 2019 Honda Insight. ...
- 2019 Chevrolet Malibu.

If you take your annual income of $75,000 and divide it by 12 to get your monthly income, you'll come to $6,250. Now multiply that by 10% to get **$625**, as per the rule stated above. From this math, you shouldn't spend more than $625 on your monthly car note.

So, theoretically, if your salary is $50,000 you could afford a car payment of $430 or less. With a $100,000 salary, you could afford **a mortgage payment of no more than $2,500**. For those with a salary near $30,000 your home, car, and debt combine should be no more than $1,250 per month.

NerdWallet recommends spending **no more than 10% of your take-home pay on your monthly auto loan payment**. So if your after-tax pay each month is $3,000, you could afford a $300 car payment. It's important to be realistic about how long you can or want to be making this monthly payment.

Whether you're paying cash, leasing, or financing a car, your upper spending limit really shouldn't be a penny more than 35% of your gross annual income. That means if you make $36,000 a year, the car price shouldn't exceed $12,600. Make $60,000, and the **car price should fall below $21,000**.

Expert estimates range broadly. Greg McBride, a senior vice president, chief financial analyst at Bankrate.com, advises that a car payment should **equal no more than 15 percent of your pretax monthly pay**. That means that if you make $50,000 a year, your monthly car payment could be as much as $625.

With no other bills, you can afford a $40k car with **a yearly income of $12,000**. But if you do have other bills ( ie wife and children and a mortgage and student loans) then consider your bills and decide if you can afford a new car.

With that 28/36 rule in mind, someone with $120,000 yearly income could **spend up to $33,600 per year on a mortgage**. Assuming a 30-year fixed mortgage, a homeowner following the 28/36 rule could feasibly pay off a $1 million home with a $33,600 yearly commitment.

One rule of thumb involves dividing your pretax earnings by 40. This means that if you make $100,000 a year, you should be able to afford **$2,500 per month in rent**. Another rule of thumb is the 30% rule.

What is the 50-20-30 rule? The 50-20-30 rule is a money management technique that divides your paycheck into three categories: **50% for the essentials, 20% for savings and 30% for everything else**.

**Nothing is too much for a car if you are passionate about it**. You might think of using the 35000 in other useful ways or invest it.

According to experts, a car payment is too high if the car payment is **more than 30% of your total income**. Remember, the car payment isn't your only car expense! Make sure to consider fuel and maintenance expenses. Make sure your car payment does not exceed 15%-20% of your total income.

First unveiled at the NAMPO agricultural show in 2017, **the Bajaj Qute** has set social media alight more recently with stories, memes, jokes and videos about this compact little 'car'. The story goes that you can buy it for only R5 000, that it will only cost you R150 per month and that you can insure it for only R1. 20.

What income is required for a 400k mortgage? To afford a $400,000 house, borrowers need $55,600 in cash to put 10 percent down. With a 30-year mortgage, your monthly income should **be at least $8200** and your monthly payments on existing debt should not exceed $981. (This is an estimated example.)

For homes in the $800,000 range, which is in the medium-high range for most housing markets, DollarTimes's calculator recommends buyers bring in **$119,371 before tax**, assuming a 30-year loan with a 3.25% interest rate.

A good rule of thumb is that the maximum cost of your house should be **no more than 2.5 to 3 times your total annual income**. This means that if you wanted to purchase a $500K home or qualify for a $500K mortgage, your minimum salary should fall between $165K and $200K.

**15-20% of the Purchase Price**

Having an idea of what price you want to pay for the vehicle will help you estimate how much money you will need for a down payment. Once you've figured how much the vehicle is going to be, multiply it by 15-20%.

“A typical down payment is usually between 10% and 20% of the total price. On a $12,000 car loan, that would be **between $1,200 and $2,400**. When it comes to the down payment, the more you put down, the better off you will be in the long run because this reduces the amount you will pay for the car in the end.

I make $65,000 a year. How much house can I afford? You can afford **a $221,000 house**.

Considering the average new car price in 2018 was $37,577, a $50k car isn't really a stretch. Financial experts say you should not spend **more than 15% - 20% of your monthly income on a car**. In 2018 the median income in the U.S. was $63,179.

The median necessary living wage across the entire US is **$67,690**. The state with the lowest annual living wage is Mississippi, with $58,321. The state with the highest living wage is Hawaii, with $136,437.

You'll want to **take 20% of your annual income** to determine what you can afford to spend on a vehicle. For instance, at $36,000/year, you'll be able to spend $7,200 yearly on your vehicle ($36,000 x . 20 = $7,200).

How much should you spend on a car? If you're taking out a personal loan to pay for your car, it's a good idea to limit your car payments to between 10% and 15% of your take-home pay. If you take home $4,000 per month, you'd want your car payment to be **no more than $400 to $600**.