How much car can I afford?

Common rule: car payment + insurance + fuel + maintenance ≤ 10-15% of take-home pay. A tighter rule: price ≤ 35% of gross income. For a $60,000 earner, that's a $21,000 car max. Use our car-affordability-calculator for your specific numbers.

What's a good interest rate on a car loan?

As of 2026: new car loans run 5.5-7% for excellent credit, 9-13% for fair credit, 15%+ for subprime. Used car rates are typically 1-2% higher. Dealer financing is often higher than credit union financing — shop both.

Should I choose a 60-month or 84-month loan?

60 months max, ideally less. 84-month loans keep payments low but extend you underwater (owing more than the car is worth) for 4+ years. If you can't afford the 60-month payment, you can't afford the car.

Is a car payment a bad financial move?

Not necessarily — but most Americans finance too much car. A $500 monthly car payment over 20 working years, invested at 8%, would be $275,000+ in retirement. The financial cost of car payments is massive. Buying used and financing shorter helps.

Automotive · Free tool

Car Payment Calculator

Monthly loan payment with sales tax, trade-in, and down payment. Includes total interest + amortization.

Updated April 2026

Vehicle price ($)Down payment ($)Trade-in value ($)Sales tax (%)Loan rate (% APR)Term (months)

Monthly payment

$602.74

Loan amount: $30,080 (incl. $2,080 tax)

Total paid

$36,164

Total interest

$6,084

Amortization summary

Payment	Interest	Principal	Total
First payment (mo 1)	$188.00	$414.74	$602.74
Last payment (mo 60)	$3.74	$599.00	$602.74

Early payments are mostly interest; late payments are mostly principal — that’s why paying extra early saves so much.

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What it does

Before signing at the dealer: see monthly payment, total interest, and how payments shift from interest to principal over time.

Runs entirely in your browser — no upload, no account, no watermark. For more tools in this category see the full tools index.

Embed this tool on your siteShow snippet

Paste this snippet into any page. Loads on-demand (lazy), no tracking scripts, and sized to most dashboards. Replace the height to fit your layout.

<iframe src="https://freetoolarena.com/embed/car-payment-calculator" width="100%" height="720" frameborder="0" loading="lazy" title="Car Payment Calculator" style="border:1px solid #e2e8f0;border-radius:12px;max-width:720px;"></iframe>

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How to use it

Enter price and down payment.
Enter rate and term.
Read monthly + total interest.

Frequently asked questions

How much car can I afford?: Common rule: car payment + insurance + fuel + maintenance ≤ 10-15% of take-home pay. A tighter rule: price ≤ 35% of gross income. For a $60,000 earner, that's a $21,000 car max. Use our car-affordability-calculator for your specific numbers.
What's a good interest rate on a car loan?: As of 2026: new car loans run 5.5-7% for excellent credit, 9-13% for fair credit, 15%+ for subprime. Used car rates are typically 1-2% higher. Dealer financing is often higher than credit union financing — shop both.
Should I choose a 60-month or 84-month loan?: 60 months max, ideally less. 84-month loans keep payments low but extend you underwater (owing more than the car is worth) for 4+ years. If you can't afford the 60-month payment, you can't afford the car.
Is a car payment a bad financial move?: Not necessarily — but most Americans finance too much car. A $500 monthly car payment over 20 working years, invested at 8%, would be $275,000+ in retirement. The financial cost of car payments is massive. Buying used and financing shorter helps.