After your mortgage or rent, car loan or lease payments are likely to be the next-biggest item in your monthly budget. So calculate carefully what you can really afford. And don't forget to take into account such items as insurance costs and property taxes. In pricing the car itself, don't forget state and possibly local sales tax -- which can run as high as 12%, but more typically 5% to 8% of the purchase price.

A new (or used) car calls for a new state registration, with fees typically running from $50 to $125. These items usually figure into the total amount you borrow with a loan or finance with a lease -- and therefore help determine your real-life monthly payments.

Financial planners say a good rule of thumb is to plan on spending 10% to 15% of your total monthly budget on all automotive expenses. If you are buying a new car, your warranty will cover major repairs for at least the first three years. But remember that warranties do not cover routine maintenance such as oil changes or replacement for items such as batteries, windshield wipers or tires.

A new car means higher insurance costs. (Opting for a late-model used car can cut those costs.) Your premiums for liability coverage, required of all drivers, may not change much from your old car. What will increase is the so-called collision and comprehensive portions of your policy. Collision pays to repair accident damage to your car, while comprehensive covers theft, fire, and natural disasters. Since you will want these coverages for a new car, your costs could shoot up sharply -- especially if you have been driving an older car or truck and have dropped collision and comprehensive coverage to save money.

Check the record. One way you can cut your insurance costs before you buy is to choose a car or truck that has a good safety record and/or a low theft rate. Insurance costs vary not only by model but by metropolitan areas, and even from city to suburbs within those areas. So when you have narrowed the number of cars or trucks on your wish list to a handful, call your agent for a rate quote, or you can check theft and safety records on the web. For federal crash test results, go to nhtsa.dot.gov. The site operated by the insurance-company sponsored Highway Loss Data Institute will give you rankings for injury and property losses for any vehicle, plus a list of the most- and least-stolen models. Both those factors affect insurance costs as well as your safety and peace of mind.

Those same rankings can be used for recent-model used cars. To help with that decision, the next section covers new versus used.