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Aug 21, 2023

Question of the Day: What is the average monthly payment for new and used cars?

Ready to hit the open road? You might want to pump the brakes. 

Answer:

  • Avg. new car payment: $725
  • Avg. used car payment: $515

 

Questions:

  • Do these averages make you feel like that’s how much a person should spend on their monthly car payment? Explain why or why not.
  • What are some potential consequences of people dedicating a larger percentage of their income to car payments?
  • What are some reasons why car prices and monthly payments have increased so much?
  • Do you think the extra “bells and whistles” that come with many vehicles are worth the increased price? Explain why or why not.

 

Here are the ready-to-go slides for this Question of the Day that you can use in your classroom. 

 

Behind the numbers (NerdWallet):

"The average monthly car loan payment in the U.S. is $725 for new vehicles and $516 for used ones originated in the first quarter of 2023, according to credit reporting agency Experian.

It’s worth noting that more recent reports from other industry analysts place the average car payment for new and used vehicles even higher. Auto site Edmunds reported the average monthly payment for new cars as $733 in the second quarter of 2023. The average used car payment for the same time period was $569.

When you’re buying a car, it’s helpful to use the average car payment amount as a benchmark, but your actual car payment per month is determined by several different factors."

 
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Supplement your core personal finance curriculum with more of NGPF's mini units.
 
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The Buying a Car mini unit will help students build the confidence to tackle one of life's biggest purchasing decisions. 

About the Author

Ryan Wood

Ryan grew up with and maintains a love for learning. He graduated from the University of Wisconsin-Green Bay with a degree in Business Administration and worked in sports marketing for a number of years. After living in Texas, Colorado, Tennessee, and Minnesota, the call of education eventually brought Ryan back to his home state of Wisconsin where he was a Business and Marketing teacher for three years. In his free time he likes to spend time with his wife and daughter, play basketball, read, and go fishing. Now with NGPF, Ryan is excited to help teachers lead the most important course their students will ever take.

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