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How Much Car Can You Afford?


At Jay Hodge Chevrolet, we know how stressful it can be to pay for a car beyond your budget. You can depend on our team to help you determine your budget and find the perfect car that meets your needs. We understand that everyone has unique requirements, which is why we take the time to listen to your preferences and find a car that fits within your budget. To ensure a hassle-free shopping experience, we've created a guide that will help you determine your budget beforehand. Trust us to make your car shopping experience stress-free and enjoyable.

5 Factors That Determine the Total Cost of Owning a Vehicle?

There are five factors to consider when determining the cost of owning a vehicle, which are not included in the sticker price. Those five factors include:

  1. Taxes and Fees – You’ll want to consider taxes and fees like sales tax, registration fees, and insurance.
  2. Maintenance and Repairs – Your vehicle will need regular maintenance to keep it operating smoothly, so it’s essential to factor that into the overall cost when determining the cost of ownership.
  3. Interest on Financing – If you have an auto loan, then over the loan term, you’ll accumulate interest.
  4. Depreciation – A vehicle will experience the majority of its depreciation in its first year after leaving the lot, so understanding your value can help determine your total investment.
  5. Fuel – Each make and model has its own fuel range, so make sure you factor that into your budget.

Determining Your Monthly Transportation Budget

One of the most important aspects of achieving financial stability is to carefully consider your transportation expenses. According to financial experts, it's recommended that you limit your expenses, including insurance, fuel, maintenance, and payments, to only 10% or 15% of your income. By doing so, you can avoid overspending and maintain a reasonable cost of transportation that aligns with your budget. Remember, keeping your transportation expenses in check is key to achieving long-term financial success.

Calculating How Much You Can Afford for A Car

When planning to buy a vehicle, it's important to list your preferred vehicle models first and then calculate the total cost of ownership, including maintenance, insurance, and fuel expenses. By subtracting this number from your monthly income, you can determine how much you can comfortably afford each month.

As a car owner, it's important to keep up with regular maintenance to ensure your vehicle stays in top shape. The American Automobile Association recommends budgeting $600 to $700 annually, or $50 per month, for maintenance costs. By doing so, you'll not only prevent unexpected breakdowns and costly repairs, but you'll also benefit from saving $75 each month in the event of any unforeseen damages.

How To Calculate the Cost of Fuel

  • Calculate Monthly Distance – Take the average distance you travel daily and multiply it by 30 (average number of days in a month).
  • Calculate Gallons Used – Determine your vehicle's MPG and divide it by the daily distance you travel.
  • Calculate Total Cost of Fuel – To account for fluctuations, add a dollar to the current price per gallon and multiply it by the number of gallons your vehicle needs.

Formula: Monthly Fuel Cost = (Mile Per Day x 30 / MPG) x Price Per Gallon

Find an Affordable Car at Jay Hodge Chevrolet

Considering the financial impact is crucial when purchasing a car. Opting for a vehicle that aligns with your budget can significantly enhance your financial well-being. Jay Hodge Chevrolet offers a diverse selection of brand-new and pre-owned vehicles catering to your budgetary needs.

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478 Wildcat Way, Sulphur Springs, TX, 75482
Jay Hodge Chevrolet 33.10835, -95.60622.