Create an Amortization Schedule for a Car Loan and Make Extra Payments

[@anitapetrova4317]

This was great. I am teaching my 16 yo daughter, who just got her first car, what is amortization schedule, and why it is important to understand it. This was perfect example for her to see what extra payments to the principal can do.

[@SixMinutesSmarter]

Glad it was helpful! Show her a FV calculation, too. Finish the car payments quickly and put that money into some Vanguard funds.

[@heliocalasansjr8638]

Thanks for the video. But what is the interest formula for bi-weekly payment?

[@ngee4925]

Super helpful as always Ralph, thank you!

[@zacharyguajardo]

Thanks for the easy to follow explanation. This was a great video!

[@Mtnsunshine]

This was wonderful! You explained things nice and clearly. I am new to Excel, so while all of this is easy to follow, I just need to learn how to put in the ‘ absolute’ values.

[@SixMinutesSmarter]

You're very welcome! I sometimes forget to put in those absolute references, too. As soon as a reuse/copy the formula is when I see that something is amiss.

[@bijandosi5684]

How is the finance cost determined?

[@digitalhorizons]

It's been said that you can pay this type of schedule off faster by splitting the payment in half and paying it twice a month (NOT bi-weekly thus resulting in a 13th payment). However, I am having trouble seeing this as the rate is divided by 12 and not 365 or 366 (ie. daily). Is there something I am missing here?

[@jesus-b5w8e]

i dont know if car dealership gonna let you pay in advanced. I heard they dont.

[@panko02]

This is flat rate or effective rate? Car loan is flat rate right? If i pay extra each month. It will be like your example?

[@SixMinutesSmarter]

Correct. Car loans are a fixed-rate loan--interest is the same for the life of the loan. Most loans are like that, so they're easy to calculate with Excel.

[@panko02]

@@SixMinutesSmarter thanks.. so what would u suggest… to pay extra each month or save some to be paid off once?

[@jesus-b5w8e]

you cannot do that when paying a car loan by paying in advance.

[@panko02]

@@jesus-b5w8e fyi.. updated situation… as mu calculation… i did pay extra each month and pay double in some months and it turned out good.. i could reduce the total amount of interest and paid off faster…

[@MarmikPanchal]

This example does not include days on which the loan was funded to the date of first payment.

[@fidelnacienceno9158]

I can’t make my spreadsheet auto populate any of the months, I literally have to do each myself

[@thelaxboy22]

Me too

[@PacMappy]

if it has not been answered already, three cells have to follow that sequence or pattern; in one cell, lets say put "month 1", in the cell below that, "month 2", and in the cell below month 2, put "month 3". highlight those three cells, THEN drag it to however long the total number of payments are; it should auto populate by then this is assuming Excel 2010 or newer is used; im not sure if it also applies to Excel 2007 or older. hope this helps

[@projectpegasus1297]

array formula ( concatenate ( "Month", sequence ( 50, 1 , 1 ,1 ))) something like that on Google sheets

[@luisdiaz8474]

I got a negative number on my final payment. Everything is the same way you did it. I’m not sure what went wrong. And my finance cost came up to be less than the posted finance cost.

[@freddyosman6963]

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