A staggeringly high number of people are ignoring traditional rules of thumb when it comes to transportation costs.

Answer: 16.8%

Questions:

• Do you think it’s a good idea to have such a large portion of your income dedicated to a car payment?
• What are some other important spending categories that could be impacted by such a large car payment?
• What are some approaches you could take to lower the amount of money you spend on transportation, including your car payment?

Here are the ready-to-go slides for this Question of the Day that you can use in your classroom.

Behind the numbers (Detroit Free Press): 

"If you don't limit what you spend on a car payment, you're not going to be able to save as much money toward bigger goals, such as a down payment on a mortgage for a home or building a nest egg for retirement, either.

'A large monthly car payment might result in an individual only being able to save 3% to 5% into their monthly 401(k), as opposed to 8% to 10%. Over time, that makes a huge difference,' Munzenberger said."

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About the Author

Ryan Wood

Ryan grew up with and maintains a love for learning. He graduated from the University of Wisconsin-Green Bay with a degree in Business Administration and worked in sports marketing for a number of years. After living in Texas, Colorado, Tennessee, and Minnesota, the call of education eventually brought Ryan back to his home state of Wisconsin where he was a Business and Marketing teacher for three years. In his free time he likes to spend time with his wife and daughter, play basketball, read, and go fishing. Now with NGPF, Ryan is excited to help teachers lead the most important course their students will ever take.