My Affordable Car

By: Mitch Fisher

My salary: $40,000

Budget: Yearly Monthly

Housing $14,000 $1,166.67

Taxes $10,000 $833.33

Transportation(Car) $4,000 $333.33

Transportation(other) $2,000 $166.67

Food $6,000 $500

Savings $2,000 $166.67

Medical $1,200 $100

Miscellaneous $800 $66.67

What can I afford?

3 Year: PV=333.33(1-(1+.0357/12)^-(12*3)/(.0375/12)=$11,332.78


4 Year: PV=333.33(1-(1+.0357/12)^-(12*4)/(.0375/12)=$14,836.19


5 Year: PV=333.33(1-(1+.0357/12)^-(12*5)/(.0375/12)=$18,210.86

My Decision

I'm going to choose the 5 year plan. I only have $333.33 to spend per month on a car so it would be the most affordable for my salary. The total payment isn't really that much higher than the other options either.