Buying and Financing a Car

45-minute agenda

1. 0–5 min

   Warm-up

   Post: “A car ad says “$299 a month!” What else will you pay besides that?”

   Teacher note: Insurance, gas, maintenance, registration, and a down payment — often hundreds more a month.

2. 5–12 min

   Direct instruction

   Present the lesson slides. Make sure students leave with these points:

   • Total cost = payment + insurance + gas + maintenance + fees.
   • New cars depreciate fastest early on.
   • Get pre-approved; negotiate total price.
   • 20/4/10: 20% down, ≤4 years, ≤10% of income.

   Use the “See it” slide (The real monthly cost of a $15,000 used car) to make the idea visual.

3. 12–17 min

   Worked example

   Walk through “Two cars, one budget” on the slides. Pause before the result and ask students to predict it.

4. 17–22 min

   Live demo

   Project finance a car from the slides or the Loan Calculator. Change one input at a time and have students call out what they think will happen.

5. 22–32 min

   The True Cost

   Format: pairs · 10 minutes

   1. A used car costs $15,000. The buyer puts 20% down and finances the rest at 8% APR for 4 years.
   2. Monthly costs: insurance $150, gas $120, maintenance $60.
   3. Pairs use the loan calculator to find the payment, then total all monthly costs.
   4. Pairs check the result against the 10% guideline for someone earning $4,000 a month before taxes.

   What to look for: Down payment $3,000; loan $12,000 → $292.96/month. Total ≈ $622.96/month, which is over the 10% guideline of $400.

6. 32–37 min

   Check for understanding

   Use the question slides — or run them as a Four Corners game. Answers:

   1. What's the smartest response? — B. Focus on the total price, and use your own pre-approved loan rate to compare
   2. The loan payment is the only monthly cost you need to budget for when you buy a car. — False
   3. Why should you get a used car inspected by an independent mechanic? — B. To uncover expensive problems before you buy
7. 37–42 min

   Discussion

   • Do you need a car where you live? What are the alternatives and their costs?
   • Why do dealers focus on monthly payments?
8. 42–45 min

   Exit ticket

   Prompt: What does “depreciation” mean for a car?

   Answer: The car loses value over time — fastest in the first few years for new cars.