How do you figure out a reasonable car purchase price?
Most car-buying advice assumes financing, leaving cash buyers and people trying to align purchases with income without clear guidelines. Without a dependable rule of thumb, buyers struggle to determine how much they can reasonably spend without overpaying or risking major out-of-pocket repair costs on older vehicles.
What people tried
Every workaround mentioned in the threads below. We haven’t tested any of them — and nobody here is claiming they worked.
- 1Buying a cheaper used car or SUV with better gas mileage and towing a trailer
- 2Stretching loan terms to lower monthly obligations while making extra principal payments
- 3Saving cash over several months to pay for the vehicle outright rather than financing
- 4Picking an arbitrary budget number they feel comfortable with
- 5Limiting total vehicle value to a percentage of annual income (such as 30% to 50%)
- 6Capping vehicle costs at a percentage of monthly income
In their words
Unedited, grouped by where they were said, most upvoted first within each place, each linked to the thread it came from.
“There is no rule, cash has no bearing on the amount.”source ↗
“I need to replace my current vehicle and would like to get a truck, but I’m unsure how much I should reasonably spend or whether I should buy used, CPO, or new.”source ↗
“Paying around $25,000 for a nine or ten-year-old truck with close to 100,000 miles seems expensive, especially when I would be responsible for any major engine or transmission repair. At the same time, I’m not sure that spending twice as much on a new truck makes financial sense.”source ↗
“I’m trying to determine what would be a financially responsible way to buy the type of vehicle I actually want.”source ↗
“Question is, are there any rules of thumb for how much one can reasonably spend when buying a car in cash?”source ↗
“Every car buying rule I see is for someone financing. Or is this truly a “personal finance is personal” situation where I just have to pick a number I’m comfortable with?”source ↗