Car Affordability Calculator
Today is Monday 12th January 2026
UK Car Finance Calculator
Disclaimer: This calculator is provided for illustrative purposes only and does not constitute financial advice, a credit recommendation, or an offer of finance. Figures are estimates based on the information provided. Actual rates, approvals, and terms will depend on your individual circumstances and the lender. ChangeCar.com accepts no responsibility for financial decisions or losses incurred.
How Much Car Can You Really Afford? A Guide to UK Car Budgeting
Buying a car is one of the most significant financial commitments most people in the UK will make. Whether you are looking for a reliable family SUV or your very first vehicle, the first question isn’t "What do I want?"—it’s "How much car can I afford?"
Our UK Car Affordability Calculator is designed to take the guesswork out of your search by helping you balance your monthly budget against the total cost of ownership. By understanding your limits now, you can avoid the stress of overextending your finances later.
The 20/4/10 Rule for Car Finance
When calculating your car budget, many financial experts suggest using the 20/4/10 rule as a benchmark for affordability in the UK market:
20% Down Payment
Aim to put down at least 20% upfront. This helps you avoid "negative equity," where you owe the lender more than the car's current market value.
4-Year Term
Try to keep your finance agreement (PCP or HP) to no more than 48 months. Longer terms mean lower monthly payments but significantly more interest paid over time.
10% of Income
Your total monthly motoring costs - including finance, insurance, and fuel - should ideally stay under 10% of your take-home pay.
Understanding Total Cost of Ownership (TCO)
In the UK, the monthly finance payment is only part of the story. To truly understand affordability, you must consider these hidden costs:
- Car Insurance: Premiums vary wildly based on your age, location, and the car's insurance group (1-50). Always check a quote before signing.
- Road Tax (VED): Electric vehicles often enjoy lower rates, while high-emission cars or those over £40,000 incur a premium supplement.
- Maintenance and MOT: Older used cars may have lower monthly payments but often require more frequent repairs and yearly MOT tests.
- Fuel or Charging: With fluctuating petrol prices, calculating your weekly mileage is essential for a realistic budget.
PCP vs. Hire Purchase (HP)
Choosing the right finance product significantly affects your monthly affordability:
- Personal Contract Purchase (PCP): Offers lower monthly payments because you are paying for the car's depreciation. However, you face a large "balloon payment" at the end to keep the car.
- Hire Purchase (HP): Monthly payments are higher, but you own the car outright at the end of the term with no final lump sum.
Shop with Confidence
Before heading to the dealership, use our tool to set your limits. Knowing your maximum monthly payment allows you to negotiate from a position of strength and ensures you don't fall in love with a car that puts your lifestyle under strain.