Can You Really Afford That Brand New Car?

While many consumers take a great deal of pleasure in buying a new vehicle, a new report shows that many households are stretching dollars more than they should. In fact, only one major city in the country can really afford the average price of a new car these days.

The typical price of a new vehicle reached $30,550 last year, but using a simple rule regarding median-income and affordability, Washington D.C. is the only place out of the nation’s largest 25 cities that families could truly afford it, according to Interest.com’s 2013 Car Affordability Study.

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“What this research indicates, more than anything, is that a lot of Americans are spending too much money on their cars,” says Mike Sante, managing editor of Interest.com. “Car costs are one of the most controllable parts of a household’s budget. For example, if you live in New York City or San Francisco, you’re probably going to have to pay a lot for housing, but you don’t have to pay a lot for a car. You’re better off driving something more affordable and saving or investing the difference.”