How Much Money Should I Spend on a Used Car?

We have plenty of used cars here at Serra Honda of Champaign, and we’re confident that we can find one that suits your budget. Nothing can ruin the fun of a Honda car quite like it being a massive financial burden, so knowing how much you can afford is a necessity.

There is one general rule to keep in mind, but then there are some other factors that you should consider before you make that final decision.

How Much You Should Spend

A general rule that frugal drivers can follow is that you shouldn’t spend more than 10 to 20 percent of your monthly income on your transportation. Now remember that this doesn’t just include the car payment. Once you’ve purchased a pre-owned Honda car you also have to consider costs like insurance, maintenance, and fuel.

So do some math and figure out how much of your monthly income 20 percent is. Then make sure that your car payment and all other ownership costs are lower than that.

What Else to Consider

Sticking to that above rule is good for many drivers, but you should also consider your unique situation and some other factors. If you have a lot of other debt, like student loans and credit cards to pay off, you want to be careful that a used car doesn’t overextend you financially, so trying to stick to the lower end of that 10 to 20 percent range can be a good idea.

On the other hand, if you’re buying a family car and need more safety features and tech, maybe spending a little more than 20 percent of your monthly income can be worthwhile. Use the rule as a guideline, but don’t ignore your own circumstances or needs just so that you can say you stuck to it.

If you’re searching for a used car that you can rely on, talk to our Honda dealers in Champaign, IL. Whether you’re looking for an efficient sedan or a spacious family vehicle, we’re ready to assist you and work with your budget.