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Figuring out what car you'd like to buy is fun; figuring out the financing is a less pleasing prospect. This is a situation many car dealers love to take advantage of. You leave the details to them, and they rip you off. You end up paying a lot more money for the next several years.

Financing is not complicated, however. It just involves taking a few steps.

Step 1: Figure out your budget

First, you need to figure out how much you can afford to pay for a car. Unless you have enough money saved to purchase a car outright, this involves figuring out what monthly payment you can afford. Tally your monthly bills (If you need help, see our budget calculator). Now, subtract all of these expenses from your income. This is what you can afford to spend on a car.

This does NOT mean that if you have $300 left over, that's the monthly payment you can afford. You also have to pay for insurance, gas, maintenance, and annual registration fees:

• Estimate your monthly mileage. Multiply the mileage by the price of gas in your area.
• Estimate your insurance premium. Call your preferred insurance carrier or get a quick quote from Military.com's partner Esurance. They will give you a free, no-hassle quote. Insurance goes up, way up, if you buy a sports car -- and also if you're young. Don't buy the Corvette just to give it up two years later.
• Look at the service record of the car. Get an estimate on yearly maintenance and repairs. Remember, the more expensive features you buy, the more expensive it will be to replace them when the time comes. If you buy five hundred dollar tires, you'll have to pay that much to replace them.
• Registration fees. The car has to be registered every year. Check with your state driving department.

Subtract these costs from the $300 a month. This is the monthly payment you can afford. Don't freak out if this number is lower than you expected. It's better to know now than three months after you buy the car, when you would have to give it up and your credit is skewered for the next seven years. Also, you may be able to find a good deal on the model you want if you buy something a couple of years old.

Step 2: Set a Price

What you just did was figure out how much you were going to pay on a monthly basis. The final step is to translate that to a car price, which is simple. If you can afford $250 a month, and you can pay that for four years, the car price you want is $12,000. If you have any money saved for a down-payment, include that in the price.

When you actually go to the dealership and talk to the dealer, be sure you negotiate over price and NOT monthly payment. They have multiple ways to cheat you if you negotiate monthly price and not car price.