Car Financing
Hour 5 Algebra 2 Project by Maiya Focht
My Yearly/Monthly Budget
-Taxes: $16250/ $1354.16
-Housing: $22750/ $1895.83-Food: $9750/ $812.50
-Savings: $3250/ $270.83
-Transportation payment: $6500/ $541.66
-Other transportation: $3250/ $270.83-Medical: $1950/ $162.50
-Miscellaneous: $1300/ $108.33
What Can I afford?
Below are the amounts I can spend on a car over three different loan time periods.
Used 2014 Volkswagon Jetta
This sleek black car comes used with 32,926 miles and with a price of only $19,600.00.
WHEN CAN I AFFORD MY CAR?
If I were to take out a three year loan, it would be a monthly rate of $576.50 which would not fit my budget.
If I were to take out a four year loan, it would be a monthly rate of $440.36 which would fit my budget.
If I were to take out a five year loan, it would be a monthly rate of $358.75 which would fit my budget.
Actual amount I decided to spend on the car loan:
I didn't chose the three year loan because of obvious reasons, I could not afford it. But I didn't choose the five year loan plan because of interest costs, with interest duration the overall cost of the car could've been much higher than the 4 year plan. Taking into account the fact that I couldn't afford the 3 year plan, and for 5 years it would simply take much longer to pay off which would be a pain, I chose the four year plan.
Which means over the course of the loan I will pay:
$21,137.28
Bonus
Between the rebate and the 0 percent interest the better option is the rebate, because the monthly rate is lower by $127!