What is a regular car payment and example of fixed expense, variable expense, interest, ownership, interest
A regular car payment is a fixed expense that typically includes a set amount that is paid monthly for a car loan or lease.
Example of fixed expense: A car payment of $300 per month for a car loan.
Example of variable expense: Gas, maintenance, and insurance costs for the car, which can vary month to month.
Interest is the additional amount paid on top of the principal loan amount for borrowing money. For example, if a car loan has an interest rate of 5%, the borrower would pay 5% of the principal amount each month in addition to the principal payment.
Ownership refers to the legal possession and control of a car. When a car is purchased through a loan, the lender technically owns the car until the loan is paid off, at which point ownership is transferred to the borrower.