Your long, lost Aunt Bessie just died and left you $5000. However in her will she stipulated that you MUST use the money towards the purchase of your first car and that YOU will be responsible for the day to day cost of owning and operating that vehicle. Yes you can finally buy the car of your dreams, but - be advised that there is a huge financial responsibility with owning your own car. You must consider things like gasoline and insurance. If you choose, you may purchase a more expensive vehicle...but then you will need to take out a loan. Keep all these expenses in mind as you follow the steps below in ORDER as you buy your own car:

1) Go on the internet and find the car of your dreams. You must pick a car that cost over $7,000. You may choose from one of these web sites:

www.autotrader.com
www.cars.com
www.automotive.com
www.usedcars.com
www.ausedcar.com
www.nada.com
www.autobytel.com

or you can visit a particular brand name website for a NEW car. Such as:

www.bmw.com
www.chevrolet.com
www.toyota.com

2) Open up an excel spreadsheet in your student file. Indicate the make, model, year and price of your vehicle somewhere on the spreadsheet. When you enter the price - in the next column be sure and add 10% for tax, license and delivery charges etc. Sum this total. This is the total cost of your new car.

3) Start an expense column or row like we did in class. Check a copy of the GAS & MAINTENANCE chart in class - OR USE THE ATTACHMENT BELOW. Match your vehicle type with where you live and on your speadsheet enter your monthly cost.

4) Check a copy of the correct CAR INSURANCE chart based on your gender and grades - OR USE THE ATTACHMENT BELOW. You might want to note that students who earn better grades earn an insurance discount. Enter your monthly isurance rates based on where you match up on the chart.

5) Since your car cost over $7,000 then you MUST take out a loan. Next - make sure you calculate the amount of your loan. Please be sure you did step 2 and added 10% to the cost of your vehicle to allow for taxes, license fees, delivery charges etc. Subtract your $5000 down payment - this is the total amount of your loan. Check a copy of the CAR LOAN sheet in class - OR USE THE ATTACHMENT BELOW - to determine how many months you will likely need to pay off the loan and the interest rate you will pay. Then use the loan calculator (see the link below) like we did in class to figure out your monthly payment and round UP to the nearest dollar. Be sure and enter the correct loan rate. Indicate the rate on your spreadsheet. Then enter your monthly car loan payment in the next column.

6) What are you average monthly expenses? How much do you spend on food, CD's, movies etc? Check a copy of the MONTHLY EXPENSES chart - OR USE THE ATTACHMENT BELOW. Be honest as you scan the chart and enter your monthly expenses in the next column.

7) Use the sum feature and add together your all your expenses. This is your total expenses and is the amount of money you need to earn each month in order to properly maintain your new car and keep up with the loan payments. If you fall behind on the payments your car will be repossessed by the bank that is carrying the loan.

8) What are your final monthly expenses to won the car of your dreams? Can you afford the car you just bought?

9) Finished early??? Earn more Olson Dollars! Try this quiz for fun. Score a perfect 20 for 20 and earn one Olson Dollar.