Burnem Wizfyre
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Car ?'s
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Kirun
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Rajaah
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I have a car question. I want to get a Tesla Model 3, but I don't have a ton of money laying around anymore at this juncture after all of my other life expenses. I also don't particularly need this car, and it'll likely have to wait. Goal is to get this done by 2024 at the latest, and maybe as soon as next year if I can work something out.
What's the smartest way to go about achieving such a thing? Like, save up and make a big downpayment, then a monthly payment like any other car? I feel like the interest on a $40k car would kill me. I've had interest on $20k cars before and that already felt like $200 a month down the toilet.
What about getting a used one? Would that be a smart thing to do? I'd rather go new, unless the price difference is just that massive.
Right now I've got a 2018 Mazda 3 with very low mileage (50k or so). It's fantastic and in perfect condition. I'm thinking what I'll do is try to keep the Mazda 3's mileage on the low end and sell it whenever I'm ready to make the switch. It's going to take me a bit longer to pay it off, though, which is the main obstacle in this whole thing. I still owe about $10k there.
I'm sure I could get $10k for selling it easily, maybe a little more, especially if I sold it this year rather than say 2024. However that would merely pay it off and leave me with nothing and no car.
Instead I'll start a "car fund" and throw some USD in that whenever I've got some extra. Whenever crypto has a spike I can take some off the top from there and throw it into the car fund as well. Currently the majority of my extra money goes to crypto investments as it is, so I'll need to stop adding funds to those accounts for a while and put new deposits towards the car fund. I'll also keep making payments on the car and keep it in good condition.
Once the car fund has $10k in it and the car itself is mostly (or fully?) paid off, I can sell the car and then go drop a $20k down-payment on the Tesla, which would leave me owing around another $20k which I'll then go on a payment plan with and so on. If I slash the price in half right from the get-go I don't think interest will be that much of an issue.
TL;DR: I'll probably be spending like $800 a month on car stuff for the foreseeable future to both pay off my existing car and beef up my new car fund enough for a downpayment.
I'll take any advice on making this crazy plan work
What's the smartest way to go about achieving such a thing? Like, save up and make a big downpayment, then a monthly payment like any other car? I feel like the interest on a $40k car would kill me. I've had interest on $20k cars before and that already felt like $200 a month down the toilet.
What about getting a used one? Would that be a smart thing to do? I'd rather go new, unless the price difference is just that massive.
Right now I've got a 2018 Mazda 3 with very low mileage (50k or so). It's fantastic and in perfect condition. I'm thinking what I'll do is try to keep the Mazda 3's mileage on the low end and sell it whenever I'm ready to make the switch. It's going to take me a bit longer to pay it off, though, which is the main obstacle in this whole thing. I still owe about $10k there.
I'm sure I could get $10k for selling it easily, maybe a little more, especially if I sold it this year rather than say 2024. However that would merely pay it off and leave me with nothing and no car.
Instead I'll start a "car fund" and throw some USD in that whenever I've got some extra. Whenever crypto has a spike I can take some off the top from there and throw it into the car fund as well. Currently the majority of my extra money goes to crypto investments as it is, so I'll need to stop adding funds to those accounts for a while and put new deposits towards the car fund. I'll also keep making payments on the car and keep it in good condition.
Once the car fund has $10k in it and the car itself is mostly (or fully?) paid off, I can sell the car and then go drop a $20k down-payment on the Tesla, which would leave me owing around another $20k which I'll then go on a payment plan with and so on. If I slash the price in half right from the get-go I don't think interest will be that much of an issue.
TL;DR: I'll probably be spending like $800 a month on car stuff for the foreseeable future to both pay off my existing car and beef up my new car fund enough for a downpayment.
I'll take any advice on making this crazy plan work
Lambourne
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That's more a finance question than a car question. I'd be hesitant to buy a Tesla right now because they're currently popular, meaning used prices are high, but their value in the long term is uncertain. Other manufacturers are ramping up electric car production with new models coming out left and right for the next few years, so Tesla's first mover advantage is going to disappear. Would you buy a Tesla if it had a gasoline engine? Probably not. Being electric is the only attractive thing about them and that distinction is going to disappear in the next few years. Today's hotness may well be old hat in a few years' time and that carries a substantial financial risk.
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Fogel
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You already have a 2018 with low mileage, buying another car just doesn't make any financial sense. Pay off your Mazda and then think about all those monthly payments that will be going into your investment account instead.
Burren
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Honestly, it sounds like the car is too expensive for you and there would be better uses for your 2-3 years of savings, like putting it away for retirement. I get that you want it, but you certainly don't need it. I'd also say you're wasting money on crypto, but kids these days don't like to hear that.
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BrutulTM
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Financially the best way to own a car is to buy one used, say 2-3 years old, and pay cash for it, and drive it for 10 years or until it starts to have major repairs and save up for the next one in the mean time. That's just from a financial aspect. It's hard to do once you're in the cycle of always having a car loan though, especially if you like to change cars often because you can't put money away for your next car if all your spare cash is going to payments for your current one. Cars are such a status symbol in our society that people are willing to go deep in debt over them even though they don't need to at all. If all you need is reliable transportation you can get that easily in the $10k range but people are willing to pay 50, 60, 70+ thousand dollars for a car with a nice interior, a cooler brand logo on the hood, or with better acceleration and handling. Not just pay it but go in debt for it, and then do it again a few years later when their old one isn't even paid for yet and is quickly depreciating. Cars for a lot of people are a symbol of their level of success in life, and a lot of times it's a lie because people are scraping by to afford an extravagant car. Expensive way to stroke your ego IMO but to each their own.
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100% agree. I stopped caring about the cars I drove in my 20s. When all my friends getting jobs, getting their Camaros and Mustangs and other such nonsense, I drove a fucking base model saturn I paid cash for. Last car I bought was a 2 yr old impala I paid $15K for. It is now paid off and still has many ears left.
Also I learned that no one really gives a shit what you drive. You think they do but they could give 2 fucks.
BrutulTM
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100% true. You always imagine people judging you as you drive up or whatever, but most people don't care at all or even pay attention.
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So many other things in life that matter 100% more to spend your money on than a fucking car that you use maybe 1 hr a day if that. Now that im home working its like a hour a week, lol.
The consensus here is pretty spot on in terms of what's smart financially. Definitely should try to live below your means and cars just depreciate so much.
But if you are really, really set on this, here are some options If you are unsure of the car's value, can get a quick appraisal on Carvana/Carmax, etc. If you have good equity, this could allow you to capture the equity in this crazy used car market. Sell the car and pocket the rest. You could look into them leasing a car to get you by the next 2-3 years, ideally something with a payment that you currently have or less, not sure what your current payment is. Or take the equity from this and cash on hand to buy an even cheaper car. So at the end of the 2-3 years, you would have had no payment during this time, plus whatever you can sell the last car for.
By this time in the future, it could be possible that Tesla will get tax credits again, but that's hopeful and shouldn't be part of your decision-making. If you are open to a different EV, you can look into that. Rivian looks interesting to me. The Kia Niro EV seems nice if you are looking for a smaller EV and as far as I know still has tax credits available. But again if you are set on a Tesla, I wouldn't count on a federal credit, could look into any state ones.
As far as interest on a car, with good credit, you should be able to get a pretty low rate, not a big deal IMO. A $45k note at 2.9% and 60 months works out to $3.4k interest or so which doesn't seem too bad to me. If you can get an interest rate less than inflation, I say go for it. That 20k down payment can be put into an ETF and get like 10% rather than going against the 3% or whatever. Interest rates will have to rise at some point, but market is nutso so who knows.
But again, the overall recommendation is not to push for a Tesla if it's outside your range. I get chasing the feeling of a new fun car, but not really worth it. I say this hypocritically of course as I am going to buy a new Kia Telluride next month. Good luck to you.
But if you are really, really set on this, here are some options If you are unsure of the car's value, can get a quick appraisal on Carvana/Carmax, etc. If you have good equity, this could allow you to capture the equity in this crazy used car market. Sell the car and pocket the rest. You could look into them leasing a car to get you by the next 2-3 years, ideally something with a payment that you currently have or less, not sure what your current payment is. Or take the equity from this and cash on hand to buy an even cheaper car. So at the end of the 2-3 years, you would have had no payment during this time, plus whatever you can sell the last car for.
By this time in the future, it could be possible that Tesla will get tax credits again, but that's hopeful and shouldn't be part of your decision-making. If you are open to a different EV, you can look into that. Rivian looks interesting to me. The Kia Niro EV seems nice if you are looking for a smaller EV and as far as I know still has tax credits available. But again if you are set on a Tesla, I wouldn't count on a federal credit, could look into any state ones.
As far as interest on a car, with good credit, you should be able to get a pretty low rate, not a big deal IMO. A $45k note at 2.9% and 60 months works out to $3.4k interest or so which doesn't seem too bad to me. If you can get an interest rate less than inflation, I say go for it. That 20k down payment can be put into an ETF and get like 10% rather than going against the 3% or whatever. Interest rates will have to rise at some point, but market is nutso so who knows.
But again, the overall recommendation is not to push for a Tesla if it's outside your range. I get chasing the feeling of a new fun car, but not really worth it. I say this hypocritically of course as I am going to buy a new Kia Telluride next month. Good luck to you.
Rajaah
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It's doable with some work, which makes it even more appealing. I have a long history of making things work that shouldn't have socially or financially, whether it's going after an off-limits girl or getting something way outside my price range after some trades and legwork.
That said I've also failed a few times and been left in a worse position, so yeah. I might need to abandon the Tesla idea for now. As has been pointed out, by the time my Mazda 3 starts to have issues, there will be a lot of new EVs on the market. Right now Tesla is basically a luxury thing, and that luxury thing can rapidly become a normal thing. See also, the first OLED big-screens being like $4500 and now those same TVs are like $1000.
According to the Tesla website there are still tax credits available, because it has the Model 3 listed at "$40k / $32k after refund" or something along those lines. Unless they just never fixed it, which would be kind of deceptive. I was going off of $34k being the overall price, which I could certainly do after a car sale and a few months of savings to cut it in half. Adding another 25% to that isn't so hot though.
Well, the fact that it's doable means there's a chance I'll go after this regardless if my finances are looking good and I see an avenue to make it work. I spend a lot of time in a car. However, putting all of that money towards investments instead is probably a lot more productive.
I also really like the self driving / autonomous function because I could get so much more done if I didn't have to drive. However, at least with the Model 3, it looks like that function isn't actually autonomous and still requires the driver's full attention, which seems to defeat the purpose. It also costs an extra $10k on top of the price I listed above. That's a bit much. When I first heard about this I thought it was fully autonomous and included with the $40k Model 3 which made me pretty guaranteed to get one. Now that this function is removed from the equation, the Tesla in general is a bit less appealing to me. The main boon now is not having to pay for gas anymore. Currently I'm shelling out $30 to fill up every time I get back from driving across-state, which I have to do a couple times a week, and it's getting ridiculous.
Rajaah
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I've got an idea. Maybe I can do some sort of one-week test drive of a Tesla 3 to help me either make a decision on this or get over it. I bet after a week my car-wanderlust will be sated and I won't "need" that car anymore. Either way I can scratch the itch while making a better decision.
Now I just need to find out where I can do this one-week test drive
Now I just need to find out where I can do this one-week test drive
You can check out Turo for Tesla rentals. If you live in any sort of metro, I'm sure you can find them pretty easily. I think near me it's like $220 per day so not cheap, but cheaper than jumping into a Tesla. The tax credit listed on there looks like it's based on some California stuff and not the federal credits. There are other EV options too if you just hate the gas thing. But you have to be honest with yourself if you really want the EV or just the Tesla status symbol.
Burren
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You think you'll save money on gas, but 100% guarantee there will be an alternative road tax for EVs because the states are not able to get their tax revenue from the pump. You will spend just as much in the end, its only a matter of time.
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Rajaah
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Probably a little of both. I like everything about Teslas, like the massive tinted sunroof and the roomy interiors. Other EVs I've looked at just aren't nice like that.
$220 for one day? Jebus. Maybe I'll rent mine out sometimes if I get one. Two days and the car payment for that month is paid.
Burnem Wizfyre
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ToeMissile
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Check w/ your insurance company on what the premium will be on the Tesla. It's typically quite a bit more than non-EV's.
Rajaah
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It's pretty messed-up how they're charging more for EVs. Not sure how they cost the insurance company more than gas-powered. You'd think these fuckers would keep the prices low and do their part for the environment
Fucker
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I've had some pretty decent cars over the years, and the only people who care about them are 20-something males and broke-assed women looking for a meal ticket....and shallow people whose opinion is about as useful as dog shit on the bottom of a shoe.
The wealthiest person I know has a base model Kia sedan as daily driver.
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