Car loan calculator: what does the car really cost?
See what a car costs each month and in all with a car loan, a residual value, an unsecured loan or leasing, and what the same money could have become on the stock market if you cycled instead. Free, and nothing you enter is saved.
What the car costs
To the lender each month
4 797 kr
4 380 kr after the tax deduction
The first month
- Interest
- 1 390 kr
- Amortization
- 3 357 kr
- Fee
- 50 kr
- To the lender
- 4 797 kr
- Tax deduction
- −417 kr
- Running costs
- 2 500 kr
- Out of your account
- 6 880 kr
- Loan
- 240 000 kr
- Effective rate
- 7,78 %
- Term
- 5 years
Over 5 years
- Loss of value
- 166 888 kr
- Interest after the deduction
- 31 358 kr
- Fees
- 3 700 kr
- Running costs
- 150 000 kr
- The car costs you
- 351 947 kr
That is 5 866 kr a month, with everything counted.
- Interest and fees cost 35 058 kr over the loan, after the deduction.
- The loss of value is the biggest cost: the car loses 166 888 kr in 5 years.
The car or an e-bike
| Cost | Car | E-bike |
|---|---|---|
| Per month | 5 866 kr | 750 kr |
| Over 5 years | 351 947 kr | 45 000 kr |
| Worth at the end | 133 112 kr | 0 kr |
| On the stock market at the end | 0 kr | 527 973 kr |
From a FIRE point of view
A car loses value every month, and a loan makes it even more expensive. The money in the car does not grow, but on the stock market it could.
With the e-bike and the difference on the stock market you would have 527 973 kr after 5 years, instead of a car worth 133 112 kr.
Left to grow by 7 % a year, the difference of 394 861 kr can be 1 089 434 kr 20 years from today.
For the return to pay 5 866 kr a month for good, you need 2 111 681 kr invested: 30 times the yearly cost, as in the FIRE calculator. For the e-bike it is 270 000 kr.
Worked example: step by step with your numbers
- The car costs 300 000 kr. You pay 60 000 kr in cash and borrow the rest: 240 000 kr.
- The rate of 6,95 % a year is 0,58 % a month. A loan of 240 000 kr paid off in equal payments over 60 months costs 4 747 kr a month. At first most of it is interest, towards the end most of it is amortization. The fee of 50 kr a month comes on top.
- Over 5 years the interest comes to 44 798 kr and the fees to 3 700 kr. 30 % of the interest, 13 439 kr, comes back as a tax deduction.
- The car loses 15 % of its value each year and is worth 133 112 kr after 5 years. It has lost 166 888 kr.
- Running costs of 2 500 kr a month for 60 months come to 150 000 kr.
- In all the car costs you 351 947 kr: 166 888 kr in lost value, 31 358 kr in interest after the deduction, 3 700 kr in fees and 150 000 kr in running costs. That is 5 866 kr a month.
- The e-bike costs 30 000 kr and 250 kr a month: 45 000 kr over 60 months, or 750 kr a month. We count it as worth nothing at the end.
- If you cycle instead and put the difference on the stock market, 30 700 kr on the first day and then about 6 630 kr a month, it grows by 7 % a year to 527 973 kr after 5 years.
- The car is then worth 133 112 kr, so the e-bike leaves you 394 861 kr better off.
- If the difference keeps growing by 7 % a year, it is 1 089 434 kr 20 years from today.
- A cost of 5 866 kr a month is 70 389 kr a year. Thirty times that is 2 111 681 kr: the capital it takes for the return to pay for the car for good, taking out about 3.3 % a year.
The stock market does not grow evenly. Some years it falls, and nobody knows the return in advance.
Year by year
| Year | Left on the loan | The car is worth | Paid for the car | Stock market, e-bike |
|---|---|---|---|---|
| 1 | 198 412 kr | 255 000 kr | 143 648 kr | 115 326 kr |
| 2 | 153 840 kr | 216 750 kr | 227 491 kr | 206 798 kr |
| 3 | 106 070 kr | 184 237 kr | 312 294 kr | 305 664 kr |
| 4 | 54 872 kr | 156 602 kr | 398 125 kr | 412 510 kr |
| 5 | 0 kr | 133 112 kr | 485 058 kr | 527 973 kr |
Paid for the car is the down payment, every payment and the running costs so far, less the tax deduction. The last column is the money the e-bike leaves for the stock market, with the return.
Why a car loan is bad for FIRE
A car loan means paying interest on something that loses value every month. That is the opposite of how wealth is built: money on the stock market grows with compound interest, money in a car shrinks.
- The loss of value is usually the biggest cost. A new car can lose half its value in three years.
- The interest comes on top. You pay to have the car before you can afford it.
- A car is a cost for good. When the loan is paid off it is often time for the next car, and the next loan.
- FIRE counts every fixed cost as 30 times the yearly cost in capital. A car for 4,000 kr a month is 1.44 million kronor that has to be saved.
The cheapest is usually a used car bought in cash and kept for a long time, sharing a car, or getting by with a bike and public transport. Open the worked example under the result to see it with your own numbers.
Ways to pay for a car
- Car loan
- The car is the security for the loan and you pay at least 20 % in cash. The loan is paid off in full over the term, usually with equal monthly payments, and the interest gives a tax deduction.
- Car loan with residual value
- You pay off only part of the loan. The rest, the residual value, is paid at the end, or you sell the car or hand it back. Lower monthly payments, but more interest in all, and if the car is worth less than what is left of the loan you pay the difference.
- Unsecured loan
- A private loan (blancolån) that the car is not the security for. No down payment needed, but usually a higher rate, and since 2026 no tax deduction.
- Leasing
- You rent the car for a fixed fee, often for three years, and then hand it back. No down payment and nothing to sell, but you own nothing at the end, can drive only so far and pay for damage.
- Pay in cash
- You pay the whole price yourself: no interest and no fees. The money could have been on the stock market instead, which the calculator counts too. Set the down payment to the price.
The calculation is an estimate, not financial advice. The lender decides what you may borrow and on what terms.
Questions about car loans
How much down payment does a car loan need?
When you buy a car on credit through the dealer, the consumer credit act (konsumentkreditlagen) requires at least 20 percent of the price in cash. Money you borrow for it through the dealer does not count. A private loan without security has no such rule, but usually a higher rate.
Can I deduct the interest on a car loan?
Yes, if the car is the security for the loan and the loan is at most 80 percent of the car's value when you buy it. Then 30 percent of the interest comes back on your tax. Since 2026 there is no deduction for loans without security, and leasing is rent, not interest.
What is a car loan with residual value?
You pay off only part of the loan. The rest, the residual value, often 30 to 50 percent of the price, is left when the term ends. Then you pay it, borrow it again, sell the car or hand it back. The monthly payment is lower, but you pay interest on more money for longer, and if the car is worth less than the residual value you pay the difference.
What is the effective rate?
The effective rate is the cost of the loan in percent a year with the fees counted and interest on interest. It is the number to compare between lenders. A small loan with a setup fee and a fee on every invoice can have an effective rate well above the nominal rate.
Is leasing cheaper than a car loan?
Leasing has no down payment and you never have to sell the car, and sometimes the car makers subsidise it. But you pay for the car's loss of value, the interest and the leasing company's margin, and own nothing at the end. A limit on how far you drive and fees for damage come on top.
How much value does a car lose?
A new car often loses 15 to 30 percent of its value the first year and about half in three years. After that it loses less every year. That is why a used car bought in cash and driven for a long time is usually the cheapest car.
Why compare with an e-bike?
For many trips to work and in town an e-bike does the same job for a fraction of the cost. It does not suit everyone or every trip, but the comparison shows what the car costs you, and what the money could have become if you managed with less car, or none.