WHAT CAN YOU REALLY AFFORD?

Before you start visiting dealers to purchase a vehicle, your first step should be to determine exactly what you can afford. There is no reason to spend time at the Mercedes dealership if your budget can't support the payment!

Consider this fact: For most people, buying a used or new vehicle will probably be your second largest purchase after a home! As such, you need to make sure you know exactly what your budget will support. Some basic questions you need to ask yourself are:

• What total purchase price can I afford?
• What monthly payment can I afford?
• How much will I be required to put down?

By preparing yourself with knowledge and facts, the car buying experience can be much easier. After you have a good idea of what you can afford, add in some of the other costs associated with this purchase such as insurance, fuel, warranties, license, and registration. These items may push a vehicle out of your budget range.

Dealers would like to sell you the most expensive vehicle you think you can afford (they are a business, after all) but that may not be the right choice from your perspective. So how do you determine the price range that is best for you? Use these guidelines and tips:

• Use an auto pricing website to determine the MSRP and Invoice price of the auto with the options you desire.
• Your monthly vehicle payment should not exceed 20% of your monthly NET income. (Check out our calculator suite)
• Don't forget to include sales tax and insurance costs in your budget calculations.

Using these tips should get you started, and allow you to narrow your vehicle choices considerably based on your budget.