How Much Car Can You Afford | Miller Toyota | Miller Toyota
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How Much Car Can You Afford?

You don’t have to blow your budget by purchasing a new vehicle model; Miller Toyota can help you find a vehicle that fits your needs and price range. You can depend on our team to navigate the car-buying process. Check out these tips to help you determine how much you can spend on your next vehicle purchase.

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

Your vehicle's total cost of ownership extends beyond the sticker price and is influenced by various factors, including:

  1. Fuel: Your vehicle requires fuel, and the cost of fuel is impacted by the type of vehicle you drive.

  2. Taxes and Fees: Additional expenses such as sales tax, registration fees, and premiums impact the overall cost of vehicles.

  3. Depreciation: New vehicles experience the majority of their depreciation in the first year after leaving the dealership lot; while it may not directly impact your out-of-pocket expenses, it is important when calculating the total cost of ownership.

  4. Maintenance and Repairs: It’s essential to include auto maintenance in your overall vehicle cost to be prepared to keep your vehicle operating smoothly.

  5. Interest on Financing: If you have an auto loan, you will have to pay interest on the vehicle, and over time, the interest will accumulate.

When considering the total cost of ownership, these factors are essential to remember and can help you be more financially responsible.

Determining Your Monthly Transportation Budget

Financial experts recommend spending no more than 10% to 15% of monthly income on transportation, including insurance, car payments, fuel, and maintenance. You can avoid overspending on a vehicle by knowing your price range.

Calculating How Much You Can Afford for A Car

Determining your vehicle budget starts with creating a shortlist of vehicles you’re interested in. Calculate each vehicle's fuel, insurance, and maintenance costs, and then subtract that from your monthly income to find your monthly car note.

According to the American Automobile Association, car owners typically budget $600 to $700 annually for vehicle maintenance or roughly $50 per month. It’s advisable to plan for $75 each month to cover unexpected repairs.

How To Calculate the Cost of Fuel

  • Multiply your average daily distance by the usual number of days in a month (30).

  • Divide the given number by the miles per gallon of your chosen vehicle.

  • Multiply the current price per gallon by the given number and add a dollar to the current price per gallon to account for fluctuations.

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

Find an Affordable Car at Miller Toyota

Visit the Miller Toyota dealership for affordable and reliable vehicles, and take the time to speak to our experienced finance department for financing options. Stop by our dealership located at 8566 Sudley Road, Manassas, VA, 20110, when you’re ready to purchase a vehicle.