Car affordability calculator

Why the payment is not the cost

Dealers lead with the monthly payment because it is the most flattering number available. It excludes everything else that owning the vehicle requires.

For many owners the non-loan costs equal or exceed the payment itself, which means a payment that fits your budget in isolation frequently does not once everything is included.

Estimating running costs

• Insurance — get an actual quote for the specific vehicle, since it varies enormously by model.
• Fuel or charging, from your real annual mileage rather than an optimistic one.
• Servicing, estimated annually and divided by twelve.
• Tyres — predictable over a few years, so divide the replacement cost by the months you expect.
• Registration, road tax, or inspection, divided by twelve.
• Parking and tolls, if they apply to your commute.
• A repair buffer, which older vehicles genuinely need.

Balloon payments

Many vehicle finance arrangements end with a large final payment rather than tapering to zero. The monthly figure is lower precisely because a substantial amount is deferred.

This calculator models a conventional loan that clears over the term. If your arrangement has a balloon, the affordable price it shows will be too low relative to what the payment supports — and you will need to fund the balloon separately.

Depreciation

Usually the single largest cost of ownership, and it appears in no ledger because no money moves. It matters most when choosing a vehicle: depreciation rates vary enormously between new and used, and a car that has already taken its steepest decline is often cheaper to own than its running costs suggest.