What is the 20/4-10 rule to buy a car?
The ’20/4/10 rule’ is a rule for buying a car you can follow where you make a 20% down payment, a 4-year loan tenure, and keep car expenses within 10% of your income.
What is the 8% rule when buying a car?
Deciding which car to buy depends on your preferences and situation, but the 20/3/8 rule could help you make your choice. The rule recommends a 20% down payment, a three-year financing term and car expenses that equal 8% or less of your monthly income. Set your car payment budget 50% for needs such as housing, food and transportation — which, in this case, is your monthly car payment and related auto expenses.