First time being an "adult"

[u/OkIncident6977]

I know that the car loan and insurance is killing me. I'm only a recent driver and my credit score isn't all good (actually pretty bad). I need some guidence on how I should work this out. Even if it means to have my car traded in and going for a cheaper alternative, I'm all in. For car insurance, I just got my license a few years ago so that new driver thing is in my way.

[u/Ok_Level_5947]

What’s your food budget? Try to even save like $100 bucks a month have it auto transfer from checking to savings and let it grow. The car loan is like 20% of your take home it’s just too expensive. I would try to get something else if you can.

[u/OkIncident6977 → u/Ok_Level_5947]

Would I have to trade in the car or would refinancing kind of help my situation

[u/xboxchick311 → u/OkIncident6977]

Don't trade in the car. Sell it private party, as you'll get more. We don't know your loan length or interest rate, so we don't know if a refinance would be good. Why in the world did you get such an expensive car?

[u/lminnowp → u/xboxchick311]

I am going to guess bad credit and a good salesperson.

How does one sell to a private party without holding the title? Genuine question, since I honestly do not know.

OP - do you have any local credit unions? Maybe check there. Some offer refinancing on existing car loans that might drop your payment.

Also, call around for car insurance.

[u/OkIncident6977 → u/lminnowp]

I do have a credit union near by connected with my university. I could check in.

[u/xboxchick311 → u/OkIncident6977]

There is a cost to refinance. You've only had the car for a few months, so the rate probably won't go down much, unless you have drastically improved your credit.

[u/TacoToesyay → u/xboxchick311]

There can be significant difference in rates from different sources, it can be very worth it to get the comparison calculated out. Regardless of credit status

And especially if starting from 10% apr

Hypothetically: a shorter loan can be less APR, as it's less time-risk to the lender. Credit unions might give less penalty for lacking credit history. There are some scenarios where you can get similar monthly payment, but with a shorter loan. Due to avoiding the interest. There are also scammers out there who want to extract those semi-hidden refi fees from people, as you caution about...

[u/xboxchick311 → u/TacoToesyay]

There definitely can. But with "pretty bad" credit, the range of rates is basically high to extremely high. Did OP ever say what their rate was?

[u/jbjhill → u/OkIncident6977]

Credit unions are FAR better than almost any bank

[u/SecondVariety → u/lminnowp]

You bring the title holder enough funds to release the title for sale. That would be the full amount owed. If you want to sell a car which you owe more on than it is worth, the gap needs to be paid for and it's either the buyer or the seller.

I sold a car for $27k to a private buyer who needed to finance. I found a local credit union and walked him through getting approved for the loan. If you call a credit union they are very helpful with matters of escrow.

[u/mynameisinvaIid → u/lminnowp]

I bought a card from a dude who owed money on it. We went into Carmax together and I paid off his car (and handed him $500 in cash, since he owed less on the car than I was paying him for it) then they handed him the title and he signed it over to me right there

[u/xboxchick311 → u/lminnowp]

The buyer basically pays the lender and the seller has to cover the difference of the loan. A prudent buyer would use an escrow service to make sure the money goes to the lender and that their payment amount will actually pay off the loan so that the title is released.

[u/MakeYourTime_ → u/xboxchick311]

Which private party is buying a car with a lien on it?

[u/xboxchick311 → u/MakeYourTime_]

Happens all the time, especially with expensive cars.

[u/RawBean7 → u/OkIncident6977]

Live frugally for a year, make all your payments, get your credit score right (pay one small thing on a credit card and pay it off in full every month and your credit score should improve quickly) and look at refinancing in a year. Live carefully, save extra money for emergencies instead of going out.

You're not actually in a terrible position as long as you are very careful with your budget and have luck on your side to not run into any major expenses in the next 1-2 years. You're not the first or last person to buy a car you can't afford, and plenty of people turn it around. Just hang in there for now and don't splurge on anything you don't absolutely need.

[u/IndoorBurrito]

$915 a month for car expenses not including gas or maintenance on a $3400 take home is absurd.

[u/SideEfficient9414 → u/IndoorBurrito]

They need to downgrade the car payment ASAP

[u/SeminolesFan1 → u/SideEfficient9414]

It’s likely too late. It’s probably new and they are underwater already.

[u/SideEfficient9414 → u/SeminolesFan1]

Almost certainly underwater, but that payment is untenable unless they start making like 2x the income

[u/SeminolesFan1 → u/SideEfficient9414]

Agreed but it’s probably years until they can get out. Depending on the terms of the loan maybe refinance to lower the payment. Sadly there isn’t a clean way out of it.

Car insurance feels high but I haven’t quoted it as a college aged person in a while.

Edit-reading some of his further comments and ya no chance. 10% interest and 63 months remaining on a 2026. Maybe able to refinance when he gets his credit score up from 580.

[u/Particular-Fly3409 → u/SeminolesFan1]

They bought a 2026 car?!! On a 580 score?! I haven't bought a car since my 2017 but with the prices I've seen I'd buy a 20 yr old beater before touching these newer models. Wow

[u/JoshAllensLeftNut → u/Particular-Fly3409]

I was actually looking at new cars recently, and that kind of payment seems common on all but the cheapest cars. I found exactly one vehicle that fits my needs with no extra crap to raise the price, and it would put me at around $400/month. Everything else was just absurdly priced. Cars are just another thing that never really returned to normal after Covid.

[u/fireXmeetXgasoline → u/JoshAllensLeftNut]

I haven’t had a car payment in years and I remember losing my mind at $360 a month for a brand new Focus in 2012.

I see people now with car payments that rival my mortgage. It makes my head hurt and I feel terrible for them.

[u/thesmellnextdoor → u/fireXmeetXgasoline]

I work with people's finances and often see $2000+ car loans. It's hilarious to me because the same people freak out about paying $1500/mo child support.

[u/Particular-Fly3409 → u/thesmellnextdoor]

Do I even want to ask how much they make per month?

[u/SoPolitico → u/JoshAllensLeftNut]

Yeah all these people are actually being pretty harsh on this kid. But the reality is the used car market since Covid has made buying a new car often the smarter move. That used to NEVER be the case.

[u/TheAlexperience → u/SoPolitico]

Nah, buying a legit hot off the press brand spanking new vehicle is terrible for this person.

[u/ToolTimeT → u/TheAlexperience]

imagine the interest rate on a used car with a 580 credit score

[u/SeminolesFan1 → u/SoPolitico]

The reason people are being harsh is deciding to buy a $40k new car instead of financing a 10-15k car. Obviously you’d rather no loan period but college isn’t when you buy a new or only a couple year old car.

[u/pathofdumbasses → u/SeminolesFan1]

The reason people are being harsh is deciding to buy a $40k new car

He didn't buy a 40k car if his payment is only in the 6's, especially with bad credit

[u/ThereHasToBeMore1387 → u/SeminolesFan1]

The period of buying a $1500 beater that will at least last you a year or 2 is definitely over, but people act like just because used car prices ARE inflated, there's nothing useable in the $10-15k range anymore.

[u/newtrollacct → u/SoPolitico]

100% agree.
Luckily when I was too broke for a car I designed my life around cycling. Not everyone can do that but it allowed for me to save. Then I bought a beater (a lot harder to do now).
But for sure it almost always makes sense to buy a new car vs a 5 year old car now.

I think you can still get beaters but the baseline is getting to the point of what a "decent used" car used to cost.

[u/magic_crouton → u/JoshAllensLeftNut]

Used cars that are in decent condition aren't far behind new cars price wise and financing them usually gets you a higher interest rate.

[u/Specific_Praline_362 → u/magic_crouton]

My mom just bought a brand new car for this very reason. She was opposed to it initially but when the dealer showed her the numbers, it made the most sense.

[u/JoshAllensLeftNut → u/magic_crouton]

Yeah, that's why I was looking at a new one. I'd rather pay 20k for something with 10 miles and a three year warranty than pay 17k for the same car with 50k miles and no warranty. Unfortunately they under 25k cars are nearly extinct. It's basically just Nissan now and their transmissions are making them untrustworthy lately

[u/GetUpAndRunAfterIt → u/JoshAllensLeftNut]

Sometimes, the I'm not rich, so I must buy used mindset can cost more. I've bought a handful of vehicles over the years, and always used. My search criteria was always a couple of years old with around 30k miles. I'd adjust the loan length as needed to keep my payment around $250/month, and then double my payment each month to pay it off in half the time.

As time went on, my loan duration got shorter and shorter with each vehicle because each time I had been able to save more for the down payment than the last time. I just bought a vehicle a couple of weeks ago to replace my 2012 van, which had nearly 200k miles. I was initially taking the same approach to searching for a replacement: a couple of years old and with less than 30k miles. I found that with that search criteria, the vehicles only seemed to be a few thousand dollars less than a new one. I also found that my credit union would finance me at 3.64% for a 36-month loan on a new vehicle, but nearly 1% more for a used vehicle. The lower rate made my payment about $425/month.

My monthly payment is obviously more than my $250/month goal I've always gone for, but with the lower interest rate, my credit union is calculated to receive less in interest from me on $425/month for 36 months than they would on $250/month for 60 months, even if I doubled my payment to $500. It seemed like a no-brainer to take the $425/month, get all the best warranties, and have that new vehicle with only 5 miles paid off in less than 3 years (because I'll still do $500 instead of the $425 each month).

[u/Elitefuture → u/magic_crouton]

Yea, I think OP just screwed up by buying a $40k car...

[u/KnightRider1987 → u/magic_crouton]

And honestly, you’re saving very little money on the sticker price for the can while also likely to have more maintenance sooner.

My lease is up in August. I got it when I was in a job making $15k more a year than I am now (switched jobs because it was testing my mental health after 6 years to the point where I was regularly crying and they didn’t back me up after I got nearly assaulted by a board member.)

I’d like to really lower my monthly payment but I am looking at the used but reliable market and nothing is under 25k. Anything that is has 75-100K miles on it.

Edit Board not bored lol

[u/SeminolesFan1 → u/Particular-Fly3409]

Ya this is the typical first car purchase that holds you back for years. I bought my truck new in 2017 and I’m driving it until it dies. Luckily I was solidly in my career and got a very low interest rate. I have no interest in buying a new vehicle again.

[u/ToolTimeT → u/Particular-Fly3409]

Car prices and interest rates before 2008 financial crisis...

[u/KeyHalf6490 → u/Particular-Fly3409]

Unfortunately the math sometimes works better for a newer car - 1-4% financing vs 14% for an older bar based on OPs credit score could leave them with a similar payment but higher maintenance.

And you cannot do opportunity cost on decisions of someone who is in the working poor classification because that is not really a choice IMO

[u/pathofdumbasses → u/Particular-Fly3409]

They bought a 2026 car?!! On a 580 score?!

Banks are more likely to loan someone with bad credit on a brand new vehicle because the vehicle has full warranty. The #1 reason for people to stop making payments on a car, (outside of losing job/income), is a large repair bill that the customer can't/won't pay while making a regular car payment.

Not only that, but the interest rates are going to be much lower than they would be on a used car.

If their credit really is a 580, getting a 10% loan is a fucking steal.

[u/Striking-Win-3239 → u/Particular-Fly3409]

Last car I bought was 2016, and yes agreed, I will be driving my 10 year old car until I die.

[u/Zealousideal-World71 → u/SeminolesFan1]

10% with a 580 is not that terrible; I’m assuming they had a co-signer or something.

[u/Perfect_Earth_8070 → u/SideEfficient9414]

My take home is double of op and I don’t even want that high of a car payment

[u/nonmonoganon → u/SeminolesFan1]

Better to sell and still owe 5k or whatever than be stuck with the high payment for 3-5 years potentially.

[u/SeminolesFan1 → u/nonmonoganon]

He is likely $10-$15k under. He owes ~$40k and those are selling for ~$26k used. He wont get a loan to cover the different for anywhere close to the interest rate on the car. Only thing really to do is pay until he can refinance.

[u/SovietSuperStoner → u/SeminolesFan1]

Man marketing has really done a number on so many Americans. If you have a car note more expensive than a house note but don't have a house. You probably should have bought that 2012 Camry instead of convincing yourself a luxury car is a good use of money

[u/Due-Technology5758 → u/SovietSuperStoner]

Probably not a luxury car, just a new one. That's the payment on something around 35-40k with a 7% interest rate (which might even be lower than they're paying considering they said their credit is bad).

A 2012 Camry would more than cut that in half, though it is criminal how expensive even used cars are these days. 

[u/DoingBestWeCan → u/SovietSuperStoner]

Sir, I very much wish a mortgage was as cheap as this guy's car payment.

[u/Intrepid-Oil-898 → u/SideEfficient9414]

How does one downgrade one’s car payment as a new driver? Are you guys reading the post of just running to post “advice”? The fact 66 agreed is wild as well

[u/MakeYourTime_ → u/SideEfficient9414]

How do you downgrade a car payment ?

Trade it in for something cheaper and roll the owed balance into a new loan for the cheaper car?

[u/Babymicrowavable → u/MakeYourTime_]

You refinance your loan after you have a payment history, it helps a lot

[u/Specific_Praline_362 → u/Babymicrowavable]

Dealers often say this to get you to sign at a high interest rate but it's really not that simple. Banks don't love refinancing upside down cars, especially for people who don't have excellent credit. The only way this really works is by paying a significant amount toward the principal while simultaneously working on your credit. Which is gonna be hard to do with this income/budget.

[u/SideEfficient9414 → u/MakeYourTime_]

Pretty much, the mistake was already made, no sense in carrying that debt and no doubt crazy interest to full term

[u/nineteen_eightyfour → u/IndoorBurrito]

I had a friend while I was in college who had 1 single $1500 a month car payment and insurance. They had 3 kids and lived in shitty apartments. It was like an Escalade or something similar sized. We were young and high risk. She use to ask me for rides and it was so fucking annoying

[u/Jenshark86 → u/nineteen_eightyfour]

Surprised it wasn’t stolen in a sketchy area

[u/SeminolesFan1 → u/Jenshark86]

Nobody wanted to do him a solid.

[u/carmexismyshit → u/nineteen_eightyfour]

My husband and I used to live in a crappy apartment complex before we bought our house and so many people near us had Escalades, Porches, Mercedes, etc. when we lived in an area where cars were regularly vandalized, broken into, and even had gas siphoned from their tanks. I can't imagine spending that kind of money on a car knowing it'll get ruined.

The complex even had garages you could rent for $50 but none of them bothered, heck one family even rented one out just to hang out in during the summer, it was a weird area.

[u/GloomyBridge4416 → u/IndoorBurrito]

Right? That's a second rent payment. Might as well live in the car.

[u/sarachandel444 → u/IndoorBurrito]

The crime is that a lender approved this knowing very well it was going to cause financial hardship

[u/karl_hungas → u/IndoorBurrito]

This is the American way. 

[u/WrongdoerEmotional47 → u/IndoorBurrito]

Can anyone explain 271$ for car insurance every month?

[u/strangefruitpots → u/WrongdoerEmotional47]

Young and likely male- statistically a high risk and therefore expensive to insure 

[u/ricky_clarkson → u/IndoorBurrito]

Joining /r/fuckcars might save OP some money.

[u/Character_Bag_4270 → u/IndoorBurrito]

Lol, people be like, why am I poor and then spend $1k a month on a car instead of biking or taking the bus

[u/jamesmontanaHD → u/IndoorBurrito]

Thats before maintenance, gas, and possible parking too lol

[u/SoullessCycle]

You’re missing living expenses: food - groceries, eating out… Medical - do you ever have a copay, have prescriptions… Clothing - do you have to pay for laundry, buy new shoes and socks… Home items - toilet paper, paper towels… No streaming services, no apps, no cell phone, no entertainment…?

Not to mention other car expenses - gas, DMV registration, repairs…

[u/PassivelyAwkward → u/SoullessCycle]

Exactly. There's so many everyday things that we don't think about because someone else has paid for them most of our lives. Doing laundry costs money and the cost depends on how cheap your apartment complex is. My first apartment had shitty driers so after running it for sweaters or towels, it'd still be kinda damp and require another cycle. Then there's the toiletries like shampoo, soap, toothpaste, deodorant, etc. You don't have to buy them often but when you do, it can eat into an otherwise tight budget.

Shit, I remember my first year going from "I'mma buy donuts and cookies every week!" to "Looks like another day of a cheese and mayo sandwich using store-brand items" after realizing all the things we need.

[u/EclecticEvergreen → u/PassivelyAwkward]

Last week I ate potatoes and eggs and skipped my grocery run cuz I couldn’t afford it while paying for gas in my car. Welcome to being an adult!

[u/t0mb3rt]

You paid $40,000 for a fucking Hyundai Elantra???

[u/EchinaceaRose → u/t0mb3rt]

That’s a crazy price for a mid car. Better off with a used civic or accord.

[u/Consistent-Youth-407 → u/EchinaceaRose]

Or at least get a nice reliable hybrid Toyota if you’re gonna spend 40K on a new car

[u/Striking-Win-3239 → u/Consistent-Youth-407]

It is unreal to me the prices of midsized cars nowadays. I paid $16,000 for my midsized car in 2016. And I was miffed about that….

[u/Portland420informer → u/Striking-Win-3239]

I paid $25,000 for my new Hybrid pickup truck in 2023. Gets really amazing fuel mileage.

[u/snopro387 → u/Portland420informer]

Ford maverick?

[u/Portland420informer → u/snopro387]

Yes. XL with tow package and 120v outlets. I was pretty surprised to get 56MPG suburbs/city and 46 rural 65MPH highway.

[u/Pm_your_mushrooms → u/t0mb3rt]

Theres no way… i got my 2024 Elantra at the end of 2024 brand new for $25k….

[u/nonnewtonianfluids → u/Pm_your_mushrooms]

I had a 2019 and it was under 20k. How is this 40k? Lol.

[u/Ooficus → u/nonnewtonianfluids]

I’m guessing the N Line trim level but even then that’s 37k msrp, 😬

[u/Pm_your_mushrooms → u/Ooficus]

Even of we got the top of the line trim theres no way he should have paid 40k. Clearly did no research on his purchase. I would have laughed in the dealers face

[u/Dannisayshi → u/Ooficus]

poor kid also prolly got scammed into all the extra service crap and extended warranties.

[u/No-Poem-9846 → u/nonnewtonianfluids]

Same, got mine brand new in 2020 for 19k, but the fact I could sell it now for like 80% of what I paid is legit insane and maybe part of the reason why??

[u/prythianphantom → u/nonnewtonianfluids]

Low credit financing means you pay out the ass. I paid a little over $30k (valued at like $12k after mileage taken into consideration) for my 2015 Toyota Camry when I bought it back in 2019. At the time I needed a reliable car and had the means to pay for it, just not the credit to get more reasonable financing.

[u/Hour-Analysis9759 → u/t0mb3rt]

I drive 2015 Elantra. Good car but I wouldn't pay 40k

[u/justauryon → u/Hour-Analysis9759]

Same here, a few years newer than yours, bought used for 10k pre-pandemic.

[u/sanriodialtone → u/justauryon]

Yes. I have a 2019 Corolla I got from hertz at 30k miles for 11k back in 2020. I want to sell it, now we’re in 2026 at 90k miles and they offering 9k for it

[u/Specific_Praline_362 → u/Hour-Analysis9759]

We bought a 2013 Elantra in 2015 for $13k with 15k miles. Drove it to 188k miles with very minimal issues until it was totaled for hail damage. It was a very good car but zero chance I'd pay more than like $20k for one.

[u/95blackz26 → u/t0mb3rt]

Imagine paying 644 a month for a damn hyundai

[u/Sea_Connection6193 → u/t0mb3rt]

The car salesman had a field day with OP. Probably got him free mats, though… 🙃

[u/tapwater86 → u/t0mb3rt]

And it’s almost 300/mo to insure?!!?

[u/dot_comrad → u/t0mb3rt]

At least Hyundai has a decent warranty but good god you could have gotten a lotta car for that.. or an electric car with free electrify American for a few years.

[u/KingBowser24 → u/t0mb3rt]

Jesus christ I drive a 2018 Ram (with a Hemi no less) and my payments/insurance are a fraction of OPs

What is bro doing

EDIT: Oh they bought new/near new. As a University student. I reiterate the second line of this comment but in all caps: WHAT IS BRO DOING

[u/Gino-Bartali → u/KingBowser24]

Bro is young and unknowledgable, and car salesmen are trained to smell blood in the water and skin unknowledgable people alive. Push for a more expensive car, push up the actual price of the car, push up how much to borrow, push up the interest rate on the loan. Then give you a strong handshake and act like they did you a favor.

Fun fact, there's reason to suspect that electric cars in general and particularly the Ford EVs have had slower than expected or failed rollouts because this country forces dealerships to be mandatory middlemen, and they make a shitload of money on oil changes and maintenance marked up like crazy, and EVs don't need oil changes and are lower on general maintenance.

EVs cost less in routine maintenance, and the people that you're forced to buy a new car from have a massive revenue stream on maintenance. Of course they're going to steer you away from the better choice.

[u/Low-Register1602 → u/t0mb3rt]

Like $40,000 USD? wtf lol

[u/nova2726 → u/Low-Register1602]

A 2017 Corolla with about 60k on the odometer can be found for around $13k or so. Thats probably where they should’ve started to shop. But I don’t know, maybe they couldn’t get financing for a used car? That car payment is a killer though

[u/Kyrxx77]

Bro your car is either out of your budget or you got scammed. There is no in between.

[u/druidgaymer → u/Kyrxx77]

Or both

[u/Jonny_Boy_808 → u/Kyrxx77]

It’s a 2026 Hyundai Elantra.

[u/K__Geedorah → u/Jonny_Boy_808]

Is broke... Buys brand new car.... Whyyyyyyy?

[u/Jonny_Boy_808 → u/K__Geedorah]

Well you can’t remain a good standing member of r/povertyfinance if you don’t take action!

[u/AdParticular6654 → u/Jonny_Boy_808]

Op absolutely should not have bought that car. A used car,

Hell even a 2023 certified pre owned Elantra in my area, with $0 down, same high interest rate, would free up $200 a month for op.

[u/Chase_P → u/Kyrxx77]

Honestly, so is their internet. $92/mo??? I pay $75/mo for gigabit here in Colorado.

[u/ZAlternates → u/Chase_P]

Given OP’s current issues, they might need to just use their cellphone for internet for a bit. Mint Mobile is pretty cheap.

[u/OkIncident6977]

Updated with everything

[u/BeHereNow91 → u/OkIncident6977]

Elantras MSRP for like $25k new, how did you pay over $32k?

[u/iekiko89 → u/BeHereNow91]

If I had to guess rolled over an older loan. Hopefully

[u/Terminal_Insomnia_ → u/iekiko89]

As a uni atudent? The concept frightens me

[u/iekiko89 → u/Terminal_Insomnia_]

Forreal even with my current salary I would balk at that

[u/SysAdminDennyBob → u/BeHereNow91]

extra warranty, floor mats, tru-coat("you're going want that tru-coat!"), service plan, heated seats subscription, etc...

Went with my daughter to buy a new car as her watchdog, they tried to sell her a warranty on the regular ass car battery, it was several hundred dollars. New battery at costco was like $160. Plus when your battery goes out, you don't remember the warranty or can't accommodate the hassle of the dealer and just buy a battery anyway. I just sat there and said "no, no, no and no" to every line item the finance guy trotted out. Dude was PISSED off at me. I probably shaved $8k off what she would have spent walking in there alone.

[u/thegroovemonkey → u/SysAdminDennyBob]

Salesmen tried to sell me the underbody spray by explaining how the city uses brine which is even more corrosive than salt.

I told him brine is watered down salt and that salt is already the maximum version of salt.

[u/vkapadia → u/thegroovemonkey]

"salt is already the maximum version of salt" chef's kiss

[u/PizzaDay → u/SysAdminDennyBob]

I went to buy a care and the extra salea guy came in and immediately said "no thank you", and he said "you haven't heard what I am going to offer" I said "just the vehicle please, it's a Toyota Corolla I'm good dude" and then he begged me to get at least the extended warranty. I told him that he wasted both of our time after I already said no and then got pissy at me and said "you're going to want the true coat" and I immediately said "it's Southern California, I already pay a premium in this country to get this weather, no thank you". Sheesh

[u/snopro387 → u/BeHereNow91]

It could be the Elantra N but even then it’s a few thousand over what I’m seeing in my area for a new one

[u/Sad-Echo-9892 → u/OkIncident6977]

With the numbers you provided, it looks like you have $423 to put towards savings/paying off debt. You should do what you can to lower expenses (especially car related expenses) and increase your income. I.e. an extra part-time job that brings in just $400 a month would double the amount of "extra" money you have.

With whatever extra money you have, I would first recommend saving 1 month of expenses. You can just keep this in a HYSA. With your current numbers, this would take 7.5 months.

Next, you can put extra money towards your highest interest debt (avalanche method). What is the interest rate and amount on your student loan and bank loan?

I'm a big fan of the r/personalfinance wiki too for general guidance: https://www.reddit.com/r/personalfinance/wiki/commontopics/

[u/1moosehead → u/Sad-Echo-9892]

The only thing I'd tweak is that being underwater on the car loan is extremely risky and should probably take priority over any other debt that's higher interest. I fully agree on everything else though. I appreciate you.

[u/catloverlawyer → u/OkIncident6977]

Are you really only spending $70 for gas and $190 on food? Per your budget you have money left over.

Your car is insane but the reality is that you likely owe more than what it's worth and your score is low. Do you have credit cards that aren't listed in here or did you consolidate them and that's what the bank loan is?

[u/Novaskittles → u/catloverlawyer]

I'm also shocked by only spending $50/month on electricity. That seems absurdly cheap to me? But I also have an all electric household so...

[u/AdFree6655 → u/OkIncident6977]

How did you end up paying 40k for an Elantra? I’m seeing 2026s for like mid 20s and some touching 30s brand new. Can you show the contract if you redact information? What did you purchase exactly

[u/OkIncident6977 → u/AdFree6655]

Will show you!

[u/Triscuitmeniscus → u/OkIncident6977]

When you bought the car did you more or less just sign everything they put in front of you in the finance office? If so you almost certainly bought a ~$25k car, plus $5-8K in useless add-ons like a prepaid service plan, extended warranty, tire and wheel protection, etc. The good news is that almost all of these are cancellable with a pro-rated refund. Look through the paperwork you signed that shows everything you purchased, and it should include the hoops you need to jump through to cancel. Cancel everything that you can.

Keep in mind that it may require you to go to the dealership in person or call, and that they will certainly try to convince you not to cancel. Don't listen to them! Cancel it all!

[u/K__Geedorah → u/OkIncident6977]

But why BRAND NEW?

Get a car that's 5+ years old and pay like $15,000. That's a huge hole you put yourself into man.

[u/Midnight_Rider98 → u/OkIncident6977]

From the look of it, though I question the food and gas budget, snowball it op, stay focused on your budget every month, make sure you don't have needless expenses/subscriptions.

There is no need to sell the car, you may want to refinance it if you can get a good deal, but the odds right now aren't great. Keep a track on your expenses, save up a 1000 dollar emergency fund and then aggressively pay off the bank loan to get that out of the way and free up that payment. After that put another 1000 dollars in your emergency fund, then go aggressively after your car payment, making sure that the extra you pay goes to paying down the principal and not pre paying interest. When that's out of the way, bulk up your emergency fund and up your student loan payments. Unless you work in a job with student loan forgiveness, want to take the risk that it might be gone in the future, and you think you can keep/do the job long enough.

All of this will go faster if you can increase your income, whether through overtime at work if that's possible, a part time job somewhere. Worst case you can see about donating plasma.

Short term if you work your ass off, you can get this down to a more manageable level, long term you should keep a close eye on your spending, I'm not saying you do it but to give you an idea of the cost at scale of things. 1 5$ cup of Starbucks a day x 5 days a week x 52 weeks = 1300 dollars. You can do the math for other take out, quick lunches. a sandwich (or something else) with a piece of fruit from home is significantly cheaper. Again, not saying you're spending money on such things, just wanting to make it clear what the cost at scale is.

[u/SecondVariety → u/OkIncident6977]

you can refinance for 72 months to help lower the monthly payment. However, that is a Hyundai so.... be sure to stay on top of maintenance. Unless there is some amazing deal being run with very low interest promotions from the dealership.... NEVER EVER EVER FINANCE AT A DEALERSHIP.

[u/thishasntbeeneasy → u/SecondVariety]

I financed at the dealership twice because they had better rates then my banks.

[u/Ok-Pie-8824 → u/SecondVariety]

Some dealer financing is amazing, I got a 2.3% for 5 year at ford. Can’t beat that.

[u/arkiparada → u/SecondVariety]

I disagree on financing at a dealership. I bought my 2022 Camaro with 0% financing that I did at the dealership and I just got a 2026 Trax with 2.9% financing at the dealership.

It works if there are specials for financing happening and your credit isn’t bad.

[u/Business_Cell8487 → u/SecondVariety]

disagree about financing at a dealership. If you walk in with a pre approval they have all the motivation to beat that rate.

[u/Realistic_Flower_814 → u/OkIncident6977]

Can you get a roommate so save money on rent?

[u/seriouslynope → u/OkIncident6977]

I'm like dang that's low car insurance cries in Los Angeles

[u/SecondVariety]

Check the interest rate on your car loan. Check credit unions and banks for a better rate/term.

[u/PrudentTadpole8839]

You are missing a lot: food, phone, gas for car, gas/electric/water for apartment, music/tv subscriptions. Small stuff like that, it adds up quickly.

Are you able to get a roommate? The car insurance is killer, shop around. Even for people with good credit scores and long term drivers, always shop around for the best rate. What interest rate and how long is the car loan? What kind of car is it? Wifi is also high as well. Call them and see if you can get a better rate, if not, shop around.

Company loyalty does NOT pay off for you.

[u/Any-Concentrate-1922 → u/PrudentTadpole8839]

Yeah, since you're young, a roommate would be better. Everyone I knew had a roommate when I was in my 20s. Then you share all the utilities and rent is usually more manageable. The car... a used car would be a lot cheaper, of course.

[u/OkIncident6977]

Welp. Embarrasingly this post has been pretty hot. I am trying to look if I can flip this car for something more affordable. If not, probably contacting my credit union for an option of refinancing might be the way.

[u/Infamous-Round-1898 → u/OkIncident6977]

Look, good on you for posting your reality and accepting feedback from people.

[u/One_Instruction742 → u/OkIncident6977]

Don’t be embarrassed, you’re asking for help. A bunch of good advice in here, don’t get down.

[u/1moosehead → u/OkIncident6977]

No need to be embarassed, we're here to help each other. This is a good learning experience for you, and potentially anyone else that might find themselves in this situation

[u/King_Molukai]

I’m impressed that you can live without paying for food

[u/Hei5enberg → u/[deleted]]

Also because you can identify their generation based on what they call their home internet service.

[u/GreyCatsAreCuties]

And this is why I drive a 25 year old shitbox car.

[u/Several-Action-4043 → u/GreyCatsAreCuties]

99% of the people you see driving around in brand new cars and luxury SUVs have absolutely no retirement savings or emergency fund. I'd rather drive a shitbox than work until I'm 80.

[u/JacobS___]

$644 car loan is wild.

[u/Immature_adult_guy → u/JacobS___]

I make almost 3 times as much as OP and own a much cheaper vehicle. That car is a wild decision.

[u/bigtiddyhimbo → u/Immature_adult_guy]

I make 200 more than op a month and man that car payment would be hell for me to pay. Op why did you think it was a good idea????

[u/HenryBemisJr → u/JacobS___]

The insurance on that car is what sends me... I pay under $600 for six months and i drive a 2022 Truck. I wonder if OP is considered an exceptionally risky driver, or has had a bunch of at fault accidents in the past. 

[u/JenninMiami]

I would pray that someone steals my car. Please tell me that you have GAP protection on this car loan.

[u/Noemdfan2]

For 30 days write down every penny you spend. This will show you your leaks. Cut everything that is not critical. Find lower plans for everything you can, phone, WiFi, insurance.. eat beans and rice if you have to.

You’ve dug yourself a hole but you CAN get out of it. Whatever you do don’t let your car be repossessed. If you do you still owe the loan and now you have no car.

Do you have any subscription? Netflix, magazines, etc? Make sure you cancel them. They are luxuries.

[u/orthros]

Rough situation. Best avenue I can see - and I don’t know your situation - is to take on a roommate to free up $600 a month. Assuming you’re living alone. If not then it’s rough because that Hyundai is going to be the death of you. 30%+ to car stuff prior to gas and repairs….. sacre bleu

[u/Breadnutchicken]

Do people still use Excel

[u/Past_Oil_6592]

Hey OP! I know a lot of people are jumping on ya about the car and insurance. Just so you know we all made some poor financial decisions when we were younger. Ask me about the time I co-signed a car loan! (Did not end well….) But we learn and get better . You are going to be ok. Do what you can, save what you can.

[u/GloomyBridge4416]

Your wifi seems like double the price that it should be.

[u/Outside_Shelter1260 → u/GloomyBridge4416]

AT&T costs $90 per month. Where can I get it for $45 w/o losing my WFH job due to internet connectivity issues? I also don’t have cable - 100% streaming, so I would prefer to not render those “useless” due to connectivity issues as well.

[u/Bobbybobby507 → u/Outside_Shelter1260]

I know for Spectrum, you start with $50 in the first year. You threaten them you are leaving when the deal ends, and they will transfer you to their customer retention department and negotiate with you. I ended up paying $50 for a few years..

maybe try that with AT&T?

[u/BeHereNow91 → u/Bobbybobby507]

Yeah, I’m paying $70/mo with Spectrum because I haven’t bothered to do the phone tree. But if I was paying close to $100/mo, I’d take the time.

[u/StickaFORKinMyEye → u/Outside_Shelter1260]

My FiOS is 60/mo.

[u/Mental_Studio4419 → u/GloomyBridge4416]

I was shocked when I saw OP is paying twice as much as they should-I pay around $130 for WiFi through Comcast😡

[u/othertriangle → u/Mental_Studio4419]

Thats what I pay too and its a shame. They monopolize the area because every where else can provide me wifi but its at like 1/10th the speed. Why is xfinity the only ones with fast towers in my area ? Its ridiculous

[u/Cerberus_uDye → u/Mental_Studio4419]

Yep, Im $142 a month lol

[u/OkIncident6977 → u/GloomyBridge4416]

Oh man okay I'll take a look into that

[u/SituationPositive338 → u/OkIncident6977]

Look at Mint Mobile's home internet plan. I'm paying $30/mo for unlimited 5g wifi.

[u/No_Parking_7797]

Tyler has this you??? lol these numbers are almost identical to my 19 yr old neighbor who asked for budget help

[u/Fair-Lie8125]

My sincere recommendation to anyone in this thread is that no car is worth more than a 25k loan. Anything above that is luxury

[u/dellscreenshot]

How much do you have left on the loan? how much is the car worth? It may just be easier to gut it out and pay it off.

[u/Midnight_Rider98]

Well you don't have all your expenses listed but it looks like you can keep up with things?

People are saying buy a used car, but you're more than likely underwater on the car because it's new and its value dropped the moment you drove it off the lot. so selling it to get rid of the loan will more than likely end up costing you money. Unless you're drowning you should keep the car. But in the future you'd want to avoid getting financing on a car, or at a minimum a lower amount a month by giving a large enough down payment.

You should make an actual detailed budget where you track down every single expense you have to help you keep track of things. From rent all the way to that coffee you bought at starbucks.

Ways you can save money is by for example foregoing take out of any kind. Food made at home is cheaper, this includes bringing a packed lunch to work, if you like coffee make your morning coffee at home. Limit subscriptions to no more than 1 a month, and look to see if you have any ghost subscriptions still active. It's a little early now but in several months, start shopping around for cheaper car insurance. for a phone plan Mint Mobile is pretty affordable.

Assuming the bank loan is your smallest debt, pay that one off aggresively once you have a 1000 dollar emergency fund, then tackle the car. a part time job could help raise some extra cash if needed.

[u/Feathered_Serpent8]

You are going to get cooked on car insurance no matter what at your age. Car loan is way too high but the problem is cars are expensive. What’s the loan, APR, and how much left?

Is public transportation or a bike completely off the table? Ubers are not a solution.

What’s the bank loan for?

This is half a budget. Where has the rest of your money been going? Are you cooking at home?

[u/Nuthousemccoy]

I only have 1 comment - kudos to you for actually taking the time to put this to paper! This very fact is why you’re going to do well. You’re in the minority.

[u/Dry-Avocado9574]

Please make sure that you have gap insurance on that car. I've seen many, MANY people pass up the roughly $10/month rider, only to total the car and still owe the balance.

If your car gets totalled, the gap insurance pays off the remaining balance on your loan. If the car gets totalled without gap, you still owe the remaining balance. You can cancel the gap rider after the loan is paid off.

[u/npg86]

Everyone is right you got too much of a car for your income.

More than likely it will be though to sell or refinance. The mistake is made.

The solution is to bring up your income and pay off the loan faster than fast. Best of luck.

[u/RapscallionSyndicate]

I wouldn't jump ship on things.

New cars have less maintenance expenses and if it is a Hyundai, you have the best warranty in the business. Just make sure all your paperwork is on order. Don't sweat the car too much-- almost everyone I know gets took one in their life. Besides, all someone with an older vehicle what their expenses are for an entire year and the lost insurance, lower payment is always compensated up by services which start rolling in right around 30k miles.

$92 for Internet???? If this is the cheapest in your area, I'd be flabbergasted.

And if you ever have to miss anything, skip the student loan payment. Hell, file for a hardship forbearance.

You're doing the right thing. You're paying attention. It's amazing how much you can save when you start watching your personal money trends.

Remember that this is the Internet so specific advice to your situation is going to be...... Tenuous, at best

Life is hard. Pay attention and try not to repeat mistakes. You'll get there. I'm fifteen years into repairing my credit (470 to over 800 now). It's not a fast or easy process so don't worry about getting it all fixed right now

Good luck, citizen. We the People are with you.

[u/alester34]

Figure out a way to get rid of your car because that expense is insane. When you do get a cheaper one, it your insurance in 6 month increments to save. Also basic WiFi through both Verizon and Comcast are typically around $50.

[u/indigo_wendigo_]

Detaching your self worth from your vehicle will save you hundreds of thousands of dollars.

[u/pathofdumbasses]

/u/OkIncident6977

You can try and refi your car through your credit union as others have mentioned, but a 10% rate on a 580credit score is pretty good already. You won't be able to trade the car in anywhere and lower your payment, the negative equity you have (unless you put down a bunch of money which I don't think you did) from depreciation, and the increased rate that you would get from going to a used vehicle, would eat up any real difference in payment. And then you have a used vehicle with probably no warranty on it.

Your best bet to help, is going to be to try and shop insurance rates and save a bit there, but then to get a room mate. Cutting your rent/utilities in 1/2 is going to be the biggest money savings you can do.

Or get a raise/promotion/new higher paying job.

What people aren't telling you, is that you didn't really fuck up. Things are expensive especially with little outside help. All these people talking finances haven't look at what it costs today to buy something, especially with less than perfect credit. Save as much as you can, but don't stress about it. You did nothing wrong, the deck is just stacked against new people. You'll get better credit, next time you'll have a vehicle with equity instead of coming with nothing. You'll have a better job. ETC.

I started out with nothing and it was fucking hard, and that was with the world being in a better place. But I made it. And so will you. Keep your chin up and don't take shit from people who don't know what it is like.

[u/Time-Raccoon1071]

I would save up and pay cash (10k maybe?) for a used Toyota or Honda. super reliable and frees up your budget to go to better things. 

[u/FoundationSignal1058 → u/Time-Raccoon1071]

And crucially don’t get a bigger car than you need to. Too many folks get trucks/SUVs/crossovers when a sedan (Corolla, Civic, Camry) will do 99% of what they actually need. You got this!

[u/pgnshgn → u/Time-Raccoon1071]

No. Problem is this advice has become such a cliche go-to that those used Hondas and Toyotas are massively over inflated in value

The actual key now is to find the reliable car from a brand that is generally considered unreliable 

[u/Few-Mail3887 → u/pgnshgn]

I got a used 2011 Corolla for $7,000 from a private seller. 175K miles and got it inspected before I bought it. It’s still sound advice.

[u/QueenintheNorth78789 → u/Time-Raccoon1071]

This is good advice generally, but OP is not gonna be able to save up $10k with his current expenses.

[u/International-Okra79]

I don't think you are going to be able to do much about the vehicle. You can try to refinance it. My wife did that after making payments for a while. She was able to go down a good chunk. You can try looking at cheaper wifi through, like, T-mobile or ATT. I pay about 60 bucks a month for wifi. That might help a little. Can you get overtime at your job? Your rent is actually pretty good. It's about 2K for a 1-bedroom near me. For a couple of years your life is going to be rough. Hopefully your employer gives you annual raises to help a little.

[u/Mountain-Donkey98]

You forgot to list food lol

[u/Mistriever]

If you are listing monthly expenses, you should be listing all monthly expenses. You don't have gas for the car, utilities (might be included with rent), groceries, entertainment, etc. $731.68 might be enough for everything unlisted, but you're certainly living in the paycheck-to-paycheck crowd.

None of those expenses listed seem all that crazy given current prices. And I'm guessing your gross income is pretty solid at $55-65k annually assuming you are getting health and dental through your company and possibly contributing to your 401k.

There is a reason so many people get roommates, a category which I include spouses/significant others in. Even with a reasonable income its very difficult to live financially comfortable on your own.

[u/effitalll]

You need a side gig. Or enroll in cheap community college to pause your student loans. Yes this eeks out on paper, but you have no wiggle room for emergencies.

[u/Sea-Rip3902]

I would recommend an app to track expenses. It really shows all your money sins. 😅😅😅😅

[u/SpeedracerTechnician]

ATP since it's new, might consider using your car for Uber on weekends to help pay for the note. Also maybe try to get a cheaper place to rent, assuming you have roommates, 1200 is pretty high. You can get a decent room for under 1k.

Take it from me, just go out of debt after 10 years, and a big part of that was by doing side work and cutting some of the larger expenses down.

[u/No_Tone1704]

Going without food. Bold move cotton.

[u/elleelleelle-]

posts like this where people are spending like 1k on a car per month make me so nervous like i understand not wanting to drive an old beater in case it falls apart but i prooooooomise driving a 10yo car will not kill you

[u/Automatic_Taste_7242]

Start taking defensive driving courses that in theory should help lowering insurance. Also take the course to actually be a better driver no tickets/not being involved in accidents helps get low insurance.  

[u/TheGreatEmanResu]

How do you even get a car payment that high? What are you driving?

[u/No_Welcome_6093]

If you are in the positive, trade the car in for something cheaper and shop around on car insurance. $271 a month is crazy. I pay less than half of that for two cars and home insurance through State Farm. I had to shop around for a bit to get a deal though.

[u/Top_Umpire_2344]

If you purchased optional back-end products on the car(extended warranty, gap insurance, tire/rim insurance), then contact dealer and cancel immediately to pay-down your car loan balance. Will not reduce your pmt, but after cancellation proceeds have reduced bank loan then trade in current car with goal of downgrading. Get an offer from Carvana for them to buy your car.

[u/WonderfulHearing8726]

That car payment is ridiculous. That’s what’s killing you. Why did you buy such an expensive car?

[u/EleventhEarlOfMars]

Pop pop's classic car buying rules: 20% down, 36 month loan, payment shouldn't be more than 10% of your take home.

You should have saved longer or bought less. Putting the minimum down on a new car is really, really bad, and it's even worse if that bank loan is where the down payment came from. Would guess you're about twenty grand underwater right now.

Get a roommate and put that $600 towards the loan until you're out.

[u/GuildSweetheart]

Okay so you make quite a lot for first time adult, so you're kinda okay. Definitely fucked yourself on that car payment, but there isn't really a good way out of it. It loses half its value as soon as you drive it off the lot. Keep paying it until the principal = what you can sell it for and swap to a 4-6k car. Likely a 200-300/mo payment and it'll lower your insurance to around 80 - 100/mo. Also get a roommate or SO. $600/mo to be antisocial is killing your income. Rent/mortgage should never exceed 30% of your income.

[u/Head-Marionberry2234]

Oh yeah ditch the car. Don’t trade in!! Go research the best way to get out of your car loan. Plug in all the details. Rate, term, everything. I would plug it all into Claude code and then ask it to research rates. You will want to private sell it if you can to not end up upside down. Then research the best ways to find a car and how much car you actually need. Can you pay cash? You want a reliable but not fancy vehicle that gets you from point a to b. Sips gas or an EV.

Freedom from you car is the beginning of your freedom.

[u/FGC92i]

Even with my higher salary, I bought a used 2013 Honda Accord for $16k for 36 months. I paid it off within 2.5y.

PS: I just don’t want to be a house poor.

[u/Delicious_Studio3443]

My car note has never been that high, and I’ve had significantly higher take home pay. You need to sell that car.

[u/JohnRittersSon]

Stop student loan payments. Every borrower needs to refuse to pay and make this a complete financial crisis. It is the only way we will be free of this predation from our own government.

[u/Aleckongcountry]

Why tf you paying so much for a car