Buying a Car

By Haris Mohamedy

My Budget

If I get $300 a week I should get $15,600 per year.

($300 per week)(52 weeks in a year)

Which Car?

I really like BMWs.

Which Kind of BMW?

A new one is probably to expensive.I’ll get a used one.Maybe a 2006 3.25i. This midsized car

costs $25,000.

The 2006 BMW 3.25i

This car is fully loaded with features like a sunroof, Bluetooth, 6 stick manual, alloy wheels, and the basics so I do not need any enhancements.

Yearly Expenses

I will need to pay for fees, gas, insurance, maintenance, and a loan.

Fees for License and Registration

A car also has fees to pay.

For all cars fees would be $75.

Yearly Expenses

Fees for License and Registration

$75.00

GasI also need to pay gas.

Every week I’ll drive to school and back, run errands, and sometimes go out.

Altogether that is about 30 miles a week.

To figure out the number of miles I drive every year, I multiply the number of miles per week by 52 (number of weeks in a year.)

(30)(52)=1,560 miles

So I would travel 1560 miles a year and would get about 25 mpg.To get the number of gallons I use every year I should divide the number of miles by

the mpg.

1560/25=62.4 gallons

Since I pay the current gas price ($2.99) for each gallon.I would multiply $2.99 by 62.4.

(2.99)(62.4)=$186.576

Round this to $186.58

Yearly Expenses

Fees for License and Registration

$75.00

Gas $186.58

Insurance

I would need to pay $2,300 for my midsized car.

Yearly Expenses

Fees for License and Registration

$75.00

Gas $186.58

Insurance $2,300.00

Maintenance

For a midsized car maintenance would be about $450.

Yearly Expenses

Fees for License and Registration

$75.00

Gas $186.58

Insurance $2,300.00

Maintenance $450.00

Loan

I decided my loan should be for 3 years or 36 months.

The formula to figure out the finance charge is:

A(N+1)(APR)2P

Loan

A(N+1)(APR)2P=

25,000(36+1)(0.07)2(12)

=25,000(37)(0.07)

24=

64,75024=

2,697.92 (Rounded)

Loan

My total finance charge is $2,697.92. I added that to the amount I’m borrowing ($25,000).

Then I got $27,697.92.I divided that by 36 for the monthly payment

and I got $769.39.To get the yearly payment I multiplied it by

12. I got $9,232.64.

Yearly Expenses

Fees for License and Registration

$75.00

Gas $186.58

Insurance $2,300.00

Maintenance $450.00

Loan Payment $9,232.64

Total Yearly Cost

My budget is $15,600.

$75.00+$186.58+$2,300.00+$450.00+$9,232.64=$12,244.22

$12,244.22<$15,600

Conclusion

$12,244.22<$15,600

Since the car fits my budget it is perfect for me.

THANK YOU FOR LISTENING!!!