How to Plan for Auto Expenses and Budgeting
When deciding on getting a car, you need to think about if you want to lease or purchase it. Unless you are paying cash, setting up a budget is really important. According to Edmunds, your monthly new-car payment should not exceed 15 percent of your monthly take-home pay, regardless of the price of the car. If you plan to lease, aim for a monthly payment that’s less than 10 percent of your take-home pay. Be sure to add an additional 7 percent of your monthly income to cover other expenses such as insurance and fuel.