What income level is needed to comfortably afford a $40k car? (2024)

To comfortably afford a $40,000 car, the income level needed will vary depending on individual financial circ*mstances and personal budgeting preferences. However, here are some insights from the Internet:

1. The 1/10th Rule for Car Buying: One popular car buying rule is the 1/10th rule, which suggests spending no more than 1/10th of your gross annual income on the purchase price of a car [3]. Following this rule, if you want to buy a $40,000 car, you would ideally have an annual gross income of at least $400,000.

2. Minimum Income Estimate: Another source suggests that, at a minimum, you would need to make $70,000 per year before taxes and deductions to afford a $40,000 car [1]. However, it's important to note that this estimate may not account for other financial obligations and expenses.

3. Personal Budgeting and Preferences: It's crucial to consider your own financial situation, including other expenses, savings goals, and debt obligations, when determining how much you can comfortably afford for a car. Some individuals may choose to spend less on a car to prioritize other financial goals, while others may be willing to allocate a larger portion of their income towards a car purchase [2].

Learn more:

1. How much money do you need to make to comfortably afford a ...
2. What salary would you need to afford your dream DD? | Come for the cars, stay for the anarchy
3. The 1/10th Rule For Car Buying Everyone Must Follow