Understanding Vehicle Loans vs. Savings: A Student Project

MATH 108X - Savings & Loans Project (Vehicle #1 #2 #3 Complete the "Loan Side" of this worksheet. #4 Complete the "Savings Side" of this worksheet. #6 Project Goal : To see how interest works against you when you take out a Loan and how it works for you when you Save. Select a car to "consider for purchase." Enter the requested information about the vehicle (see Column M). Use your own bank, or a typical value of what banks usually offer for savings account interest rates and loan terms and rates. Enter the requested information about the bank rates (see Column M). #5A, B Complete the summary cells on both the "Loan Side" and the "Savings Side" of this worksheet. Discuss this project with a friend or family member. Show them the car you are considering for purchase. Explain how much you would end up paying if you (1) took out the loan and (2) if you saved for it first. Explain which option you think is better for you and why. Talk about the consequences of missing one month of payments under each option. Summarize your discussion with your friend or family member below. Be sure to write about ALL four points below. Summarize your discussion with your friend or family member here... be sure to write about all four points listed below.

sure to write about all four points listed below. 1. Explain which option (saving first or taking out the loan and buying now that you think is better for you and why. Personally, I think saving is the best option for my circumstance. I am in no desperation to get a new car, and saving would benefit me the most, because of the earned money. While both options have a similar monthly payment, there total payments differ greatly. 2. Summarize your discussion with your friend or family member, includin their insights on your project. I discussed the project with a parent and they agreed that saving would b the best plan for me. They explained my current finances don't reflect the ability to pay a monthly car payment of that amount. Whereas if I wait an save slowly, I would have a better chance to keep up with payments, and enjoy the benefits of earned money. They attempted to play devils advoca with the taking out a loan side, but again, I have no urgency to get a different car. 3. Describe any lessons you have learned in understanding debt and savin plans. When the time comes to investigate my finances and make a plan for any kind of big purchase, I know how to calculate and decide the best plan for me. And when I have a family I can plan trips or effectively allocate money 4. How might you apply or teach others about these ideas in your future? Now that I have these skills I can assist the people in my life. For example my friend is thinking of going on a mission, but doesn't think he can do it with his savings. Or how my sister is considering going on campus but nee to calculate her finances and income to see if that is even a possibility. I am relieved to have learned a math skill that I can apply to the most relevant parts of my life.

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Option) #3 Loan Side Vehicle Sale Price Sales Tax Down Payment Loan Amount #5A APR Loan Term (months) You Paid $ 10,882.27 Monthly Payment Car Cost $ 10,494.00 Total Payments Wasted Money $ 388.27 Total Interest Loan Amortization Schedule Payment to Bank = $249.51 Month Beginning Balance To Interest To Principal 1 $ 8,594.00 $ 20.70 $228.81 2 $ 8,365.19 $ 20.15 $229.36 3 $ 8,135.83 $ 19.59 $229.91 4 $ 7,905.91 $ 19.04 $230.47 5 $ 7,675.45 $ 18.49 $231.02 Hint 6 $ 7,444.42 $ 17.93 $231.58 7 $ 7,212.85 $ 17.37 $232.14 8 $ 6,980.71 $ 16.81 $232.70 9 $ 6,748.01 $ 16.25 $233.26 10 $ 6,514.76 $ 15.69 $233.82 11 $ 6,280.94 $ 15.13 $234.38 12 $ 6,046.56 $ 14.56 $234.95 13 $ 5,811.61 $ 14.00 $235.51 14 $ 5,576.10 $ 13.43 $236.08 If yo you On this side you will compute the cost of taking out a loan to buy the car of your choice. Hover the mouse o

15 $ 5,340.02 $ 12.86 $236.65 16 $ 5,103.38 $ 12.29 $237.22 17 $ 4,866.16 $ 11.72 $237.79 18 $ 4,628.37 $ 11.15 $238.36 19 $ 4,390.01 $ 10.57 $238.93 20 $ 4,151.08 $ 10.00 $239.51 21 $ 3,911.57 $ 9.42 $240.09 22 $ 3,671.48 $ 8.84 $240.67 23 $ 3,430.81 $ 8.26 $241.24 24 $ 3,189.57 $ 7.68 $241.83 25 $ 2,947.74 $ 7.10 $242.41 26 $ 2,705.33 $ 6.52 $242.99 27 $ 2,462.34 $ 5.93 $243.58 28 $ 2,218.76 $ 5.34 $244.16 29 $ 1,974.60 $ 4.76 $244.75 30 $ 1,729.85 $ 4.17 $245.34 31 $ 1,484.51 $ 3.58 $245.93 32 $ 1,238.57 $ 2.98 $246.52 33 $ 992.05 $ 2.39 $247.12 34 $ 744.93 $ 1.79 $247.71 35 $ 497.22 $ 1.20 $248.31 36 $ 248.91 $ 0.60 $248.91 w) o y ng be e nd ate ngs r y. ? eds m

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#1 Enter your Vehicle Information here. Make: Hyundai Model: Electra SE $ 9,900.00 Year: 2015 Mileage: 42,886 $ 594.00 $ 1,900.00 $ 8,594.00 2.89% 36 $249.51 $ 8,982.27 $ 388.27 Savings Ending Balance Month $ 8,365.19 #2 1 $ 8,135.83 2 $ 7,905.91 Loan Details 3 $ 7,675.45 4 $ 7,444.42 Loan Term (years): 3 5 $ 7,212.85 Loan Interest Rate: 2.89% 6 $ 6,980.71 7 $ 6,748.01 8 $ 6,514.76 Savings Account Details 9 $ 6,280.94 10 $ 6,046.56 Savings Interest Rate: 1.20% 11 $ 5,811.61 12 $ 5,576.10 13 $ 5,340.02 Typical Loan Rates and Terms 14 ou don't have a vehicle in mind already, u can use one of these links to find one: over the triangles for help.

$ 5,103.38 New Car Used Car 15 $ 4,866.16 3-Year Loan 3.15% 3-Year Loan 2.89% 16 $ 4,628.37 4-Year Loan 3.49% 4-Year Loan 3.05% 17 $ 4,390.01 5-Year Loan 3.84% 5-Year Loan 3.52% 18 $ 4,151.08 6-Year Loan 4.28% 6-Year Loan 3.68% 19 $ 3,911.57 20 $ 3,671.48 21 $ 3,430.81 Typical Checking and Savings Account Rates 22 $ 3,189.57 Checking 0.1% Savings 1.2% 23 $ 2,947.74 24 $ 2,705.33 25 $ 2,462.34 26 $ 2,218.76 27 $ 1,974.60 28 $ 1,729.85 29 $ 1,484.51 30 $ 1,238.57 31 $ 992.05 32 $ 744.93 33 $ 497.22 34 $ 248.91 35 $ 0.00 36

#4 Savings Side $ 9,900.00 Vehicle Sale Price $ 594.00 Sales Tax $ 10,494.00 Purchase Amount $ 1,900.00 Previous Saved 1.20% APR 36 $232.67 Monthly Payment $ 10,276.13 You Paid $ 8,376.13 Total Payments $ 10,494.00 Car Cost $ 217.87 Total Interest $ 217.87 Earned Money s Amortization Schedule Payment to Savings= $232.67 Beginning Balance Interest Earned Payment Ending Balance $ 1,900.00 $ 1.90 $232.67 $ 2,134.57 $ 2,134.57 $ 2.13 $232.67 $ 2,369.38 $ 2,369.38 $ 2.37 $232.67 $ 2,604.41 $ 2,604.41 $ 2.60 $232.67 $ 2,839.69 $ 2,839.69 $ 2.84 $232.67 $ 3,075.20 $ 3,075.20 $ 3.08 $232.67 $ 3,310.95 $ 3,310.95 $ 3.31 $232.67 $ 3,546.93 $ 3,546.93 $ 3.55 $232.67 $ 3,783.14 $ 3,783.14 $ 3.78 $232.67 $ 4,019.60 $ 4,019.60 $ 4.02 $232.67 $ 4,256.29 $ 4,256.29 $ 4.26 $232.67 $ 4,493.21 $ 4,493.21 $ 4.49 $232.67 $ 4,730.38 $ 4,730.38 $ 4.73 $232.67 $ 4,967.78 $ 4,967.78 $ 4.97 $232.67 $ 5,205.42 On this side you will save first, then buy. Is the wait worth it? You decide. Savings Term (months) Hover the mouse over the triangles for help.

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$ 5,205.42 $ 5.21 $232.67 $ 5,443.29 $ 5,443.29 $ 5.44 $232.67 $ 5,681.41 $ 5,681.41 $ 5.68 $232.67 $ 5,919.76 $ 5,919.76 $ 5.92 $232.67 $ 6,158.35 $ 6,158.35 $ 6.16 $232.67 $ 6,397.18 $ 6,397.18 $ 6.40 $232.67 $ 6,636.24 $ 6,636.24 $ 6.64 $232.67 $ 6,875.55 $ 6,875.55 $ 6.88 $232.67 $ 7,115.10 $ 7,115.10 $ 7.12 $232.67 $ 7,354.88 $ 7,354.88 $ 7.35 $232.67 $ 7,594.91 $ 7,594.91 $ 7.59 $232.67 $ 7,835.17 $ 7,835.17 $ 7.84 $232.67 $ 8,075.68 $ 8,075.68 $ 8.08 $232.67 $ 8,316.42 $ 8,316.42 $ 8.32 $232.67 $ 8,557.41 $ 8,557.41 $ 8.56 $232.67 $ 8,798.64 $ 8,798.64 $ 8.80 $232.67 $ 9,040.11 $ 9,040.11 $ 9.04 $232.67 $ 9,281.82 $ 9,281.82 $ 9.28 $232.67 $ 9,523.77 $ 9,523.77 $ 9.52 $232.67 $ 9,765.96 $ 9,765.96 $ 9.77 $232.67 $ 10,008.40 $ 10,008.40 $ 10.01 $232.67 $ 10,251.08 $ 10,251.08 $ 10.25 $232.67 $ 10,494.00

#5B Hint

Winter 2024

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1

MATH 108X - Savings & Loans Project (Vehicl #1 #2 #3 Complete the "Loan Side" of this worksheet. #4 Complete the "Savings Side" of this worksheet. #6 Discuss this project with a friend or family member… Project Goal : To see how interest works against you when you take out a Loan and how it works for you when you Save. Select a car to "consider for purchase." Enter the requested information about the vehicle (see Column M). Find a bank on the internet that shows their interest rates for both auto loans and savings accounts. Enter the requested information about the bank rates (see Column M). #5A, B Complete the summary cells on both the "Loan Side" and the "Savings Side" of this worksheet.

0 le Option) Errors Remaining: 0 Number Correct: 319 Loan Side Vehicle Sale Price Sales Tax Down Payment Loan Amount #5A APR Loan Term (months) You Paid Correct Payment Car Cost Correct Total Payments Wasted Money Correct Total Interest Loan Amortization Schedule Payment = $249.51 Month Beginning Balance To Interest To Principal 1 Correct Correct Correct 2 Correct Correct Correct 3 Correct Correct Correct 4 Correct Correct Correct 5 Correct Correct Correct Hint 6 Correct Correct Correct 7 Correct Correct Correct 8 Correct Correct Correct 9 Correct Correct Correct 10 Correct Correct Correct 11 Correct Correct Correct 12 Correct Correct Correct 13 Correct Correct Correct 14 Correct Correct Correct

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15 Correct Correct Correct 16 Correct Correct Correct 17 Correct Correct Correct 18 Correct Correct Correct 19 Correct Correct Correct 20 Correct Correct Correct 21 Correct Correct Correct 22 Correct Correct Correct 23 Correct Correct Correct 24 Correct Correct Correct 25 Correct Correct Correct 26 Correct Correct Correct 27 Correct Correct Correct 28 Correct Correct Correct 29 Correct Correct Correct 30 Correct Correct Correct 31 Correct Correct Correct 32 Correct Correct Correct 33 Correct Correct Correct 34 Correct Correct Correct 35 Correct Correct Correct 36 Correct Correct Correct 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

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#1 #3 Enter your Vehicle Information here. Make: Correct Model: Correct Correct Year: Correct Mileage: Correct Correct Correct Correct Correct Correct Correct Correct Correct Savings Ending Balance Month Correct #2 1 Correct 2 Correct Loan Details 3 Correct 4 Correct Loan Term (years): Correct 5 Correct Loan Interest Rate: Correct 6 Correct 7 Correct 8 Correct Savings Account Details 9 Correct 10 Correct Savings Interest Rate: Correct 11 Correct 12 Correct 13 Correct 14

Correct 15 Correct 16 Correct 17 Correct 18 Correct 19 Correct 20 Correct 21 Correct 22 Correct 23 Correct 24 Correct 25 Correct 26 Correct 27 Correct 28 Correct 29 Correct 30 Correct 31 Correct 32 Correct 33 Correct 34 Correct 35 Correct 36 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

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0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

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#4 Savings Side Correct Vehicle Sale Price Correct Sales Tax Correct Purchase Amount Correct Previous Saved Correct APR #5B Correct Correct Payment Correct You Paid Correct Total Payments Correct Car Cost Correct Total Interest Correct Earned Money s Amortization Schedule Beginning Balance Interest Earned Payment Ending Balance Correct Correct Correct Correct Correct Correct Correct Correct Correct Correct Correct Correct Correct Correct Correct Correct Correct Correct Correct Correct Correct Correct Correct Correct Hint Correct Correct Correct Correct Err:508 Correct Correct Correct Correct Err:508 Correct Correct Correct Correct Err:508 Correct Correct Correct Correct Err:508 Correct Correct Correct Correct Err:508 Correct Correct Correct Correct Err:508 Correct Correct Correct Correct Err:508 Correct Correct Correct Correct Err:508 Savings Term (months)

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Correct Correct Correct Correct Err:508 Correct Correct Correct Correct Err:508 Correct Correct Correct Correct Err:508 Correct Correct Correct Correct Err:508 Correct Correct Correct Correct Err:508 Correct Correct Correct Correct Err:508 Correct Correct Correct Correct Err:508 Correct Correct Correct Correct Err:508 Correct Correct Correct Correct Err:508 Correct Correct Correct Correct Err:508 Correct Correct Correct Correct Err:508 Correct Correct Correct Correct Err:508 Correct Correct Correct Correct Err:508 Correct Correct Correct Correct Err:508 Correct Correct Correct Correct Err:508 Correct Correct Correct Correct Err:508 Correct Correct Correct Correct Err:508 Correct Correct Correct Correct Err:508 Correct Correct Correct Correct Err:508 Correct Correct Correct Correct Err:508 Correct Correct Correct Correct Err:508 Correct Correct Correct Correct Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508

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0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508

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0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508 0 0 0 0 Err:508

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