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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. 
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About the Author

Ryan Wood

Ryan is the Partnerships and Adoption Manager for Next Gen Personal Finance’s midwest region. He brings his experience as a former teacher, curriculum designer, and sales and marketing professional to state organizations and school districts in supporting the implementation of their personal financial education efforts. He graduated from the University of Wisconsin-Green Bay and earned his teaching credential from Saint Mary’s University in Winona, Minnesota. He proudly taught at two rural high schools in Wisconsin before transitioning to curriculum design at NGPF, and is now excited to be on the front lines in delivering the best possible financial education in the midwest. He and his wife have three beautiful daughters, each of which inspire him to share the impact of being sound financial stewards both at home and as lifelong learners.

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