Instructor explaining car payment budgeting to students, focused on the question "What is the 15 car rule?"
What is the 15 car rule?

What is the 15 car rule?

The 15 car rule is a budgeting guideline that suggests your monthly car payment should be no more than 15% of your take-home pay—meaning the income you have left after taxes and insurance. Following this rule can help ensure that your vehicle costs remain manageable and leave room in your budget for other essential expenses like housing, food, and savings. While every financial situation is different, staying within this limit can reduce the risk of overspending on a car.

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