For many Americans, the cost of owning a vehicle has become a bigger financial burden than ever before.
According to a recent report, total auto debt reached $1.68 trillion at the end of 2025, a 37% increase since 2018. Today, nearly 86 million Americans carry auto loan or lease debt.
What's driving this increase? Vehicle prices have risen significantly, interest rates remain elevated, and affordable new car options have become harder to find. As a result, many buyers are stretching loan terms or taking on larger monthly payments just to get behind the wheel.
The average monthly car payment has climbed from approximately $506 in 2018 to more than $680 today. Even more concerning, $1,000 monthly car payments are becoming increasingly common among new vehicle buyers.
While transportation is a necessity for most households, it's important to consider how a large car payment affects the rest of your financial life. Every dollar committed to an auto loan is a dollar that cannot be used for savings, investing, debt reduction, or building an emergency fund.
Before purchasing your next vehicle, take a step back and look at the bigger picture. The question isn't simply whether you can afford the payment. It's whether that payment aligns with your overall financial goals.
A car should help you get where you're going. It shouldn't prevent you from getting where you want to be financially.
#AutoDebt #CarPayments #FinancialPlanning #WealthBuilding #PersonalFinance
Source: https://www.cnbc.com/2026/05/06/car-payments-squeeze-americans.html
About Terrell Dinkins, MBA, ChFC®, RICP®
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Terrell Dinkins, MBA, ChFC® , RICP® is an investment adviser representative of and offers investment advisory services through OBN Wealth Advisors, LLC, a registered investment adviser offering advisory services in the State of Georgia and other jurisdictions where registered or exempted. Main Office: 950 Eagles Landing Pkwy, Suite 216, Stockbridge, GA 30281. Tel: 404-723-9780. Website: OBN Wealth Advisors. Image courtesy of Canva.