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Good points thus far.
One thing I'd like to add is if you finance a car for 5 years for example (60 mo), and see if your monthly payment is still below your budget, try to see if you can finance it for 6 years (72 mo). When your monthly payment is retained for the 5-year amount, but you're paying more of the balance than the interest.
Say you're paying $400 a month for the 5-year loan. If you can have it financed for a 6-year loan typically the monthly payment goes down (if the rate of payment is retained). But if you can still shoulder $400 a month, more of this goes to the balance, NOT interest.
This will give you breathing room in case you are low on funds, but make sure your % interest is as low as possible within your means. Typically the lower the % interest, the higher payments you need to make. Hence the "within your means".
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