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Methodology and assumptions
Last updated: July 13, 2026
Quick decision estimate
Monthly change equals the new monthly cost minus the monthly cost the decision replaces. First-year impact equals the upfront cost plus up to 12 months of that change. The selected-horizon impact equals the upfront cost plus the monthly change multiplied by 12, 36, or 60 months. When take-home pay is entered, income impact is the monthly change divided by monthly take-home pay.
What the quick estimate leaves out
The estimate does not automatically account for inflation, taxes, investment returns, changing income, changing recurring costs, resale value, risk, emergencies, or the time value of money. Users should include the cost categories that matter to their situation and update rough inputs as real quotes become available.
Budget Check and assistant summaries
Budget Check subtracts entered housing and utilities, transportation, food and essentials, debt minimums, flexible spending, a savings goal, and any included Quick estimate monthly change from entered monthly take-home income. Assistant summaries use disclosed thresholds to identify a monthly gap, less than 5% unassigned cushion, housing and utilities above 40% of take-home income, or debt minimums above 20%. These signals are prompts to review assumptions, not personalized financial advice or universal affordability rules.
Comparison and stress tests
Saved scenarios use the same Quick estimate formula and highlight the lowest upfront, monthly, and selected-horizon values without declaring a winner. Decision stress tests increase the upfront and new monthly cost by 10% or reduce entered take-home income by 10%. Budget stress tests raise entered living costs by 10% or reduce take-home income by 10%. These are mechanical sensitivity checks, not forecasts.
Gap-closing paths
When Budget Check shows a monthly shortfall, the reverse planner repeats that gap as the amount that would need to be offset through a lower new cost, a replaced or removed expense, additional take-home income, or a combination. It does not recommend which path is appropriate or assume that every amount can be changed.
Fixed-rate payment calculation
Monthly principal and interest use the standard amortizing-loan formula with the amount financed, monthly interest rate, and number of monthly payments. Total interest equals all scheduled payments minus principal. Results assume equal monthly payments, a fixed rate, and no missed or extra payments.
Auto Offer X-Ray
The reconciled amount financed equals vehicle price, user-entered taxes, title and registration, dealer fees, and add-ons, minus cash down, rebates, and net trade equity. When the trade payoff exceeds its allowance, the difference is treated as negative equity and increases the new loan. Cash outflow means cash down plus all scheduled loan payments; it does not assign a separate cash value to the traded vehicle.
APR scenarios
Built-in APRs are hypothetical examples. They are not live market data, lender offers, advertised averages, or predictions. Enter the APR from a written offer for a relevant result.
Decision guides and embed
Decision guides organize common cost categories and verification questions; they do not supply prices or assume every category applies. The compact embeddable calculator uses the same upfront, monthly-change, and selected-horizon formulas as Quick estimate.
Important exclusions
Unless included in the amount financed, calculations exclude taxes, registration, insurance, maintenance, add-ons, PMI, HOA dues, points, origination charges, closing costs, escrow changes, penalties, and variable-rate behavior.
Reference material
Our explanatory approach is informed by public consumer guidance from the Consumer Financial Protection Bureau's auto-loan resources and its mortgage resources.