Net Worth
$385KTop 42%PeakWorth
$4.2M+$182KNet Worth
$385KTop 42%PeakWorth
$4.2M+$182KFI Age
50y 1m-11moThe average new-car payment now exceeds $740/month. Over 30 years, that's $750K+ of foregone retirement.
Avg new car loan rate (2026)
~7.5%
Avg loan term
68 months
Underwater after 12 months on new
~30% of buyers
20/4/10 rule
20% down, 4-yr loan, < 10% income
= $3,500 down · $31,500 financed
Monthly payment
$544.64
Total interest
$7,714
Total paid
$39,214
Loan term
6 years
| Year | Payments | Principal | Interest | Balance |
|---|---|---|---|---|
| 1 | $6,536 | $4,320 | $2,216 | $27,180 |
| 2 | $6,536 | $4,655 | $1,881 | $22,525 |
| 3 | $6,536 | $5,016 | $1,519 | $17,509 |
| 4 | $6,536 | $5,406 | $1,130 | $12,103 |
| 5 | $6,536 | $5,825 | $710 | $6,278 |
Estimates only. Excludes fees, escrow changes, and tax effects. For educational purposes — not financial advice.
The classic guideline: at least 20% down, financed for no more than 4 years, with total transportation costs under 10% of gross income. Most car buyers in 2026 violate all three — and end up with negative equity, payments stretching 7+ years, and zero buffer for life events.
Run your numbers through this calculator and see how each lever (down payment, term, rate) reshapes the total cost.
If your credit improved since the original loan, your rate dropped 1.5%+, or you got the original loan from a dealer markup, refinancing through a credit union can save $1K–$5K. Run the refinance mode in this calculator to see your savings against any prepayment penalty.
A 2–3 year old used car typically costs 30–40% less than new for 80–90% of the useful life. Pair that with a short loan or cash purchase, and you free up $300–$600/mo that compounds for decades.
A calculator alone tells you the payment. PeakWorth tells you what that payment costs your retirement — and how every change ripples through the next 30 years of your finances.
Sub-6% with strong credit, 6–8% with average credit, 8%+ should make you reconsider the purchase or shop credit unions.
Almost never. If you can't afford it on a 4-year, you can't afford it. Long auto loans = guaranteed negative equity.
If you can get a sub-5% rate AND your invested cash earns more, financing is fine. Otherwise, pay cash or buy less car.
Learn guides, true-cost calculators, and audience playbooks across the PeakWorth network.
Cost of
Uber & Lyft rides, compounded
Convenience tax. See what it really costs your retirement.
Cost of
Carrying credit card debt
22% APR compounded — the silent FI Age killer.
Decision guide
Buying a car
New vs used, lease vs buy, payment limits.
Decision guide
Should you tap your home equity?
HELOAN vs HELOC vs cash-out — the FI Age trade-off.
Built for
PeakWorth for physicians
Late start, high income, six-figure debt — modeled together.
Compare
PeakWorth vs SoFi Automated Investing
SoFi’s 0.25% member robo vs the planning layer above.
PeakWorth includes every loan calculator above — connected to your real income, expenses, and goals. Every number you change updates your live FI Age and lifetime projection.
