Step 1: How Much Car Can You Afford?
A general guideline is that your monthly car payment should not be more than 20 percent of your take-home pay. However, people shop for cars with their hearts as well as their heads, and that can be a little dangerous. That's where Edmunds.
com's How Much Car Can I Afford? calculator comes in handy. It can prevent you from getting in over your head when you buy a car. The calculator helps you find an estimated price range in which to shop and will even suggest some cars that would fit your budget. Here's more information on how to set up your automotive budget.