Explore BrainMass

Explore BrainMass

    Develop a personal budget for yourself or a friend for this year

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    Assuming you would like to purchase a new car next year, develop a personal budget for yourself or a friend for this year. Make sure to include a savings plan to save enough for a down payment, taxes, license, and insurance.

    Discuss the situations that might derail the budget along with a plan for you to deal with these issues.

    © BrainMass Inc. brainmass.com December 15, 2020, 4:05 pm ad1c9bdddf

    Solution Preview

    Budgeting is an important tool to know how to do in order to save for a car.

    Let us first look at the cost of a car. Since this is probably your first new car, a mid-priced reliable car would be your best bet - how about a Honda civic? Looking at honda.com, we see the civic costs $15,505. This is the base price of the car, and is good if you know how to drive manual. With automatic it is 16,305.

    Let us assume taxes of 15%; the automatic will end up costing $18750.75. If you look carefully, there is a destination charge of $680 - so a total of $19430.75

    How we will want to purchase the car - therefore, we would finance it. With financing, we would break up the cost and pay a little every month. There is also an interest rate to consider - I will put it at 5%. We will be paying it off over 60 months. ...

    Solution Summary

    This solution provides an example of a personal budget.