Can I buy a Tesla?

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Cramerica
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Can I buy a Tesla?

Post by Cramerica » Fri Jun 29, 2018 2:29 pm

I have a tesla model three reservation and I was recently invited to configure the car.

I wanted to know if bogleheads think it is wise given my financial situation.

My anticipated gross income for 2018 will be about 250,000. I anticipate gross income for 2019 will be about 400,000. My current net worth is just over $100,000.

The model three that I am planning on purchasing cost 55,000 with all the upgrades. That does not include taxes and other fees, but it is also before the $7500 tax credit and other potential gas savings.

Do I have your blessings to buy the car?

02nz
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Re: Can I buy a Tesla?

Post by 02nz » Fri Jun 29, 2018 2:32 pm

You can, but should you? You have good income, but unless you're just starting out, your net worth is quite low. Where is all that money going? The fact you're asking for "blessings" here suggests you know deep down this doesn't make 100% financial sense. I'd build up my savings (and especially retirement) before spending so much on a car.
Last edited by 02nz on Fri Jun 29, 2018 2:32 pm, edited 1 time in total.

phisher4
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Re: Can I buy a Tesla?

Post by phisher4 » Fri Jun 29, 2018 2:32 pm

A few missing pieces of information:

How old are you?
How much do you have saved for retirement?
Do you have any debt?

My inclination is to say no. But then again, I'm a random internet stranger - take it for what it's worth. :happy

Cramerica
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Re: Can I buy a Tesla?

Post by Cramerica » Fri Jun 29, 2018 2:35 pm

phisher4 wrote:
Fri Jun 29, 2018 2:32 pm
A few missing pieces of information:

How old are you?
How much do you have saved for retirement?
Do you have any debt?
32 and I am just starting my career as a specialist physician.

I have about $160k in retirement

About $60k in low interest ( <2%) debt

masonstone
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Re: Can I buy a Tesla?

Post by masonstone » Fri Jun 29, 2018 2:37 pm

You can, just buy good disability insurance.

123
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Re: Can I buy a Tesla?

Post by 123 » Fri Jun 29, 2018 2:37 pm

Go ahead.
The closest helping hand is at the end of your own arm.

somekevinguy
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Re: Can I buy a Tesla?

Post by somekevinguy » Fri Jun 29, 2018 2:41 pm

Can vs. should- you certainly can. That being said, living like a resident for a few years will set you up for success. Hard to ever move down from a 55K Tesla...hedonic adaptation... So yeah, you probably would be fine if you bought it but the fact that you're on BH's, posting a question like that, tells me you have an idea of what the "answer" is.

Just my 2 cents. (specialist physician, DW also a specialist physician) both <5 yrs out of training. Still drive the same 2006 model car I bought in med school. NW about 10x yours (helped by a bull run but pretty much through brute savings/living like a resident).

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tyrion
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Re: Can I buy a Tesla?

Post by tyrion » Fri Jun 29, 2018 2:54 pm

Do you need a car? Presumably you've been driving something while on the Tesla wait list.

Cramerica
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Re: Can I buy a Tesla?

Post by Cramerica » Fri Jun 29, 2018 2:55 pm

somekevinguy wrote:
Fri Jun 29, 2018 2:41 pm
Can vs. should- you certainly can. That being said, living like a resident for a few years will set you up for success. Hard to ever move down from a 55K Tesla...hedonic adaptation... So yeah, you probably would be fine if you bought it but the fact that you're on BH's, posting a question like that, tells me you have an idea of what the "answer" is.

Just my 2 cents. (specialist physician, DW also a specialist physician) both <5 yrs out of training. Still drive the same 2006 model car I bought in med school. NW about 10x yours (helped by a bull run but pretty much through brute savings/living like a resident).
So you are saying I can but shouldn’t.

The way that I look at it is even if I buy the car, my net worth would still be on track to be about 10x what it is currently within five years. The forecast for my salary is: 250 in 2018, 400 in 2019, 450 in 2020, and 550+ after. My job also provides a pension.

That 10x NW target would be even more doable if I married another specialist physician, which is likely. Having said that, if I go with a cheaper car option, then I will get there that much faster.

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TimeRunner
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Re: Can I buy a Tesla?

Post by TimeRunner » Fri Jun 29, 2018 2:58 pm

Your billable time is too valuable to be hanging around a charging station. Gas and get to work! :D
"What'd ya expect in an opera, a happy ending?" -Bugs Bunny. "You gotta fight for your right to party!" -Beastie Boys

Quickfoot
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Re: Can I buy a Tesla?

Post by Quickfoot » Fri Jun 29, 2018 2:59 pm

You can but you probably shouldn't, nothing to do with income but rather Tesla in general. Tesla has failed to meet every milestone it has ever set, is burning through cash, doesn't have a sustainable path to profitability and has also failed quality standards and is likely to not survive long term. They also treat their employees poorly and are likely to lose a lot of talent. They are the Yahoo / Blackberry of the electric car, a lot of hype, successful for a short time but ultimately replaced by Google and sold for pennies on the dollar.

I'd give it a few more years before buying an electric vehicle. Pretty much every major brand is entering the electric market and they actually know how to make cars, quality will inevitably be higher and comparable vehicles will be at a lower price.

If Tesla has a future I expect it will be in selling power trains and batteries to the more established and successfull automobile manufacturers. I would not be surprised to see something like a Ford F150e with a "Powered by Tesla" sticker.
Last edited by Quickfoot on Fri Jun 29, 2018 3:04 pm, edited 5 times in total.

H-Town
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Re: Can I buy a Tesla?

Post by H-Town » Fri Jun 29, 2018 3:00 pm

Cramerica wrote:
Fri Jun 29, 2018 2:29 pm
I have a tesla model three reservation and I was recently invited to configure the car.

I wanted to know if bogleheads think it is wise given my financial situation.

My anticipated gross income for 2018 will be about 250,000. I anticipate gross income for 2019 will be about 400,000. My current net worth is just over $100,000.

The model three that I am planning on purchasing cost 55,000 with all the upgrades. That does not include taxes and other fees, but it is also before the $7500 tax credit and other potential gas savings.

Do I have your blessings to buy the car?
Can you? Yeah.
Should you? No.

randomguy
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Re: Can I buy a Tesla?

Post by randomguy » Fri Jun 29, 2018 3:08 pm

thangngo wrote:
Fri Jun 29, 2018 3:00 pm
Cramerica wrote:
Fri Jun 29, 2018 2:29 pm
I have a tesla model three reservation and I was recently invited to configure the car.

I wanted to know if bogleheads think it is wise given my financial situation.

My anticipated gross income for 2018 will be about 250,000. I anticipate gross income for 2019 will be about 400,000. My current net worth is just over $100,000.

The model three that I am planning on purchasing cost 55,000 with all the upgrades. That does not include taxes and other fees, but it is also before the $7500 tax credit and other potential gas savings.

Do I have your blessings to buy the car?
Can you? Yeah.
Should you? No.
He should buy the car if the extra 20-30k (or whatever the number is) brings him more happiness than other ways of spending the money. Nobody can answer that but him.

somekevinguy
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Re: Can I buy a Tesla?

Post by somekevinguy » Fri Jun 29, 2018 3:10 pm

Cramerica wrote:
Fri Jun 29, 2018 2:55 pm
somekevinguy wrote:
Fri Jun 29, 2018 2:41 pm
Can vs. should- you certainly can. That being said, living like a resident for a few years will set you up for success. Hard to ever move down from a 55K Tesla...hedonic adaptation... So yeah, you probably would be fine if you bought it but the fact that you're on BH's, posting a question like that, tells me you have an idea of what the "answer" is.

Just my 2 cents. (specialist physician, DW also a specialist physician) both <5 yrs out of training. Still drive the same 2006 model car I bought in med school. NW about 10x yours (helped by a bull run but pretty much through brute savings/living like a resident).
So you are saying I can but shouldn’t.

The way that I look at it is even if I buy the car, my net worth would still be on track to be about 10x what it is currently within five years. The forecast for my salary is: 250 in 2018, 400 in 2019, 450 in 2020, and 550+ after. My job also provides a pension.

That 10x NW target would be even more doable if I married another specialist physician, which is likely. Having said that, if I go with a cheaper car option, then I will get there that much faster.
Pretty much just a judgment call and totally up to you. As long as you're thoughtful about your choices, which it sounds like you are, you'll be just fine.

That being said, what are you upgrading from? Is this a "I'm done with fellowship so I'm going to reward myself" car? If so, are you planning the same upgrades for a home, electronics, other purchases? And forecasts are good but many physicians change jobs within the first few years so I wouldn't base my current purchases on future projections, especially early on.

Anyhow, congrats on being done and enjoy attending life (just not too much :wink: )

Quickfoot
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Re: Can I buy a Tesla?

Post by Quickfoot » Fri Jun 29, 2018 3:13 pm

There's nothing wrong with rewarding yourself, you've made some tremendous sacrifices to get to where you are. Life is about balancing the present with the future, sometimes on this forum too much emphasis is placed on the future which leads people to not experience life or stress about silly things like "only saving 20% of their income." Should you plan and save for retirement? Absolutely but you also might not live that long so don't make it your sole purpose. Don't let increasing your net worth become your purpose or something that stresses you out, balance in all things.

If you want a fun car I'd suggest you look at 2-4 year old luxury cars which can be purchased 50% or so off MSRP of new vehicles with very low miles. I picked up a 3 year old BMW 535i MSport with 15K miles that was 65K new for 32K.
When I bought it I knew it was not an awesome financial decision but I'd been drooling over one for 10 years, had made a LOT of sacrifices to pay off debt and take care of my family (put my wife through college) and could easily afford it. It wouldn't have been a problem to buy a new 65K 535 but I'd rather let someone else pay 33K of depreciation :).

A parting thought, people rarely regret experiences they've had but it is extremely common for people to regret NOT doing things. Make good choices but error on the side of saying yes.
Last edited by Quickfoot on Fri Jun 29, 2018 3:20 pm, edited 3 times in total.

phisher4
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Re: Can I buy a Tesla?

Post by phisher4 » Fri Jun 29, 2018 3:15 pm

Do not buy. Live like a resident for 2-3 years, and then gradually ramp up your spending. This is the recipe for financial freedom. The power of compounding at your age is is incredible, and $60K spent today would likely mean hundreds of thousands less in retirement.

You have the potential for mega-income in the future, and you feel rich; but you aren't... yet.

Speaking from experience, many specialist physicians don't find their first job to be all that they thought it would be, and you may find yourself with less projected income in the future.

MotoTrojan
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Re: Can I buy a Tesla?

Post by MotoTrojan » Fri Jun 29, 2018 3:19 pm

TimeRunner wrote:
Fri Jun 29, 2018 2:58 pm
Your billable time is too valuable to be hanging around a charging station. Gas and get to work! :D
“Fill” at home every night. More time to bill!

I’d go for it if your savings rate is high otherwise.

DesertDiva
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Re: Can I buy a Tesla?

Post by DesertDiva » Fri Jun 29, 2018 3:23 pm

Read "The Millionaire Next Door" - then make your decision. My $0.02 worth
♫ Stocks go up ♫ Stocks go down ♫ Stocks go up ♫ Stocks go down ♫ - Second verse same as the first

njdealguy
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Re: Can I buy a Tesla?

Post by njdealguy » Fri Jun 29, 2018 3:37 pm

I'd research the kind of hassle and nightmare it can be to repair the tiniest body damages on a Tesla car before even considering whether to get it (think > $5000 to fix a tiny scratch as well as potentially months of waiting time while car is at the repair shop)

This factor alone for sure will keep me away from any interest in the brand for the time being.

TravelGeek
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Re: Can I buy a Tesla?

Post by TravelGeek » Fri Jun 29, 2018 3:51 pm

Have you read today's post on White Coat Investor?

https://www.whitecoatinvestor.com/how-t ... in-hawaii/
# 3 Drive Beater(s) or Bike

Instead of upgrading the cars, downgrade the cars. I’m amazed what some people think is necessary in order to have a “reliable car.” I’ve had $2K cars that were plenty reliable (had to get one jump start in four years, drove over to AutoZone and got a new battery on the way home.) My next car was $4K. A great deal of the reason I was a millionaire 7 years out of residency on half of your income was that we didn’t spend much on cars. Or here’s an idea. Ride your bike to work. I did during residency and most of those first four years.
While your income would support the vehicle (IMO), I personally would not spend my hard earned dollars on that vehicle at this point in your life and career.

TravelGeek
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Re: Can I buy a Tesla?

Post by TravelGeek » Fri Jun 29, 2018 3:55 pm

TimeRunner wrote:
Fri Jun 29, 2018 2:58 pm
Your billable time is too valuable to be hanging around a charging station. Gas and get to work! :D
That's not how EVs work unless you are on a road trip (non billable time) or have no way to charge at home (but then, maybe at work instead?). The general idea is to charge at home overnight, to find a vehicle with a full battery any time you need. Actually saves time and hassle (no self-service gas here in OR).

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Sasquatch
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Re: Can I buy a Tesla?

Post by Sasquatch » Fri Jun 29, 2018 3:57 pm

Sam Walton’s daily driver. A little over the top.

https://social.ford.com/en_US/story/veh ... ustom.html

Having said that. Enjoy your new Tesla
Last edited by Sasquatch on Fri Jun 29, 2018 7:59 pm, edited 1 time in total.

bubbadog
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Re: Can I buy a Tesla?

Post by bubbadog » Fri Jun 29, 2018 4:10 pm

phisher4 wrote:
Fri Jun 29, 2018 3:15 pm
Do not buy. Live like a resident for 2-3 years, and then gradually ramp up your spending. This is the recipe for financial freedom. The power of compounding at your age is is incredible, and $60K spent today would likely mean hundreds of thousands less in retirement.

You have the potential for mega-income in the future, and you feel rich; but you aren't... yet.

Speaking from experience, many specialist physicians don't find their first job to be all that they thought it would be, and you may find yourself with less projected income in the future.
I am a physician 22 years out of residency. All doctors are specialists in "delayed gratification". To get where you are at today, you had to excel at college, residency, and now as a young attending. Your net worth is only three months gross 2019 salary. Are student loans paid off? Wait just a few years and let things settle out, maintain a resident lifestyle, and then pull the trigger.

It is a great time of your life. Focus on being the best young attending you can be. The world is truly your oyster!

Good luck :sharebeer

madbrain
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Re: Can I buy a Tesla?

Post by madbrain » Fri Jun 29, 2018 4:15 pm

I wouldn't do it with the net worth you have. I have 25x your net worth and still not doing it. I own a Bolt and a Volt. Less current and income and projected income than you, though. But you just never know what life has in store for you. Don't count money you don't have yet. Spend out of current income, not future income.

ThriftyPhD
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Re: Can I buy a Tesla?

Post by ThriftyPhD » Fri Jun 29, 2018 4:24 pm

njdealguy wrote:
Fri Jun 29, 2018 3:37 pm
I'd research the kind of hassle and nightmare it can be to repair the tiniest body damages on a Tesla car before even considering whether to get it (think > $5000 to fix a tiny scratch as well as potentially months of waiting time while car is at the repair shop)

This factor alone for sure will keep me away from any interest in the brand for the time being.
Over 10 years ago I was quoted several thousand dollars to fix a small scratch on my vehicle (mid range big three domestic brand). I was able to get the scratch repaired for a quarter of the cost by an independent shop. Turns out if you go to the dealer, they will charge you much more.

Now, the aluminum panels can be a challenge to paint and might raise costs while body shops retool. But all manufacturers are moving to aluminum, and one big benefit is that if it DOES scratch, it won't rust. If you're going to drive it till it breaks down, and aren't paranoid about every little scratch, you can just leave the small scratches since they won't rust.

njdealguy
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Re: Can I buy a Tesla?

Post by njdealguy » Fri Jun 29, 2018 4:44 pm

ThriftyPhD wrote:
Fri Jun 29, 2018 4:24 pm
njdealguy wrote:
Fri Jun 29, 2018 3:37 pm
I'd research the kind of hassle and nightmare it can be to repair the tiniest body damages on a Tesla car before even considering whether to get it (think > $5000 to fix a tiny scratch as well as potentially months of waiting time while car is at the repair shop)

This factor alone for sure will keep me away from any interest in the brand for the time being.
Over 10 years ago I was quoted several thousand dollars to fix a small scratch on my vehicle (mid range big three domestic brand). I was able to get the scratch repaired for a quarter of the cost by an independent shop. Turns out if you go to the dealer, they will charge you much more.

Now, the aluminum panels can be a challenge to paint and might raise costs while body shops retool. But all manufacturers are moving to aluminum, and one big benefit is that if it DOES scratch, it won't rust. If you're going to drive it till it breaks down, and aren't paranoid about every little scratch, you can just leave the small scratches since they won't rust.
I'm not talking about repairs at the dealer, am referring to posts I can see by googling where 'independent' shops that are authorized to fix Tesla cars taking months to complete the repair and charging multiple times more in the thousands for simple body repairs as compared to mainstream cars. Maybe this will change as you mention about more shops becoming proficient in working with aluminum car bodies.

Also I agree about living with small scratches, but what about the case where its instead an eyesore dent. I guess in that case it can be submitted as an insurance claim which could have been possibly avoided if the same repair on a conventional car were to cost 10% as much!

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TimeRunner
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Re: Can I buy a Tesla?

Post by TimeRunner » Fri Jun 29, 2018 5:14 pm

TravelGeek wrote:
Fri Jun 29, 2018 3:55 pm
TimeRunner wrote:
Fri Jun 29, 2018 2:58 pm
Your billable time is too valuable to be hanging around a charging station. Gas and get to work! :D
That's not how EVs work unless you are on a road trip (non billable time) or have no way to charge at home (but then, maybe at work instead?). The general idea is to charge at home overnight, to find a vehicle with a full battery any time you need. Actually saves time and hassle (no self-service gas here in OR).
Yeah, sorry I wasn't clear. I was thinking extended range driving such as coming back from a conference or a ski trip, etc.
"What'd ya expect in an opera, a happy ending?" -Bugs Bunny. "You gotta fight for your right to party!" -Beastie Boys

ThriftyPhD
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Re: Can I buy a Tesla?

Post by ThriftyPhD » Fri Jun 29, 2018 5:27 pm

njdealguy wrote:
Fri Jun 29, 2018 4:44 pm
ThriftyPhD wrote:
Fri Jun 29, 2018 4:24 pm
njdealguy wrote:
Fri Jun 29, 2018 3:37 pm
I'd research the kind of hassle and nightmare it can be to repair the tiniest body damages on a Tesla car before even considering whether to get it (think > $5000 to fix a tiny scratch as well as potentially months of waiting time while car is at the repair shop)

This factor alone for sure will keep me away from any interest in the brand for the time being.
Over 10 years ago I was quoted several thousand dollars to fix a small scratch on my vehicle (mid range big three domestic brand). I was able to get the scratch repaired for a quarter of the cost by an independent shop. Turns out if you go to the dealer, they will charge you much more.

Now, the aluminum panels can be a challenge to paint and might raise costs while body shops retool. But all manufacturers are moving to aluminum, and one big benefit is that if it DOES scratch, it won't rust. If you're going to drive it till it breaks down, and aren't paranoid about every little scratch, you can just leave the small scratches since they won't rust.
I'm not talking about repairs at the dealer, am referring to posts I can see by googling where 'independent' shops that are authorized to fix Tesla cars taking months to complete the repair and charging multiple times more in the thousands for simple body repairs as compared to mainstream cars. Maybe this will change as you mention about more shops becoming proficient in working with aluminum car bodies.

Also I agree about living with small scratches, but what about the case where its instead an eyesore dent. I guess in that case it can be submitted as an insurance claim which could have been possibly avoided if the same repair on a conventional car were to cost 10% as much!
Could be a few things. Aluminum is, if not more difficult, a different style of painting that requires shops to retool. So any aluminum vehicle (Ford F150, Tesla, etc) would have the same issue. Two, there are no old Teslas. Even the older Model S vehicles will have enough residual value that the owner file an insurance claim and insist on a 'certified' repair. That means the repair will go through a body shop that is certified by Tesla. Combination of insurance + certified means most repairs will be done at the most expensive place in the state. If you're using insurance to pay for the repair, you're going to insist that the work be done at a Tesla Certified shop. There is no downward market pressure to provide price competition. Once you have more Telsas reach older age, and the cheaper, independent repair shops become an option, there will be more equalization of price. On top of that, until now all Teslas have been Model S or X, $70k + in value. I could be wrong, but I'm guessing taking any $70k car in for a repair is going to cost more than repairing a Honda Fit, even if the work is similar in difficulty and cost of materials.

That said, sounds like prices have come down some. Here's one post where someone with two dented panels and scratches that was charged $3k for the repairs. About what I was quoted to fix a much smaller issue on a mid range vehicle over a decade ago.

ThriftyPhD
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Re: Can I buy a Tesla?

Post by ThriftyPhD » Fri Jun 29, 2018 5:32 pm

TimeRunner wrote:
Fri Jun 29, 2018 5:14 pm
TravelGeek wrote:
Fri Jun 29, 2018 3:55 pm
TimeRunner wrote:
Fri Jun 29, 2018 2:58 pm
Your billable time is too valuable to be hanging around a charging station. Gas and get to work! :D
That's not how EVs work unless you are on a road trip (non billable time) or have no way to charge at home (but then, maybe at work instead?). The general idea is to charge at home overnight, to find a vehicle with a full battery any time you need. Actually saves time and hassle (no self-service gas here in OR).
Yeah, sorry I wasn't clear. I was thinking extended range driving such as coming back from a conference or a ski trip, etc.
Wouldn't his billable hours be too much to be driving 300+ miles for a conference rather than flying? Over the course of a year, the vast majority of time spent at the pump will be your weekly fill for commuting. This goes away with an electric, since you charge at home or at work. It's one of the top selling features for me, never having to go to a gas station again.

Dottie57
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Re: Can I buy a Tesla?

Post by Dottie57 » Fri Jun 29, 2018 5:33 pm

Cramerica wrote:
Fri Jun 29, 2018 2:55 pm
somekevinguy wrote:
Fri Jun 29, 2018 2:41 pm
Can vs. should- you certainly can. That being said, living like a resident for a few years will set you up for success. Hard to ever move down from a 55K Tesla...hedonic adaptation... So yeah, you probably would be fine if you bought it but the fact that you're on BH's, posting a question like that, tells me you have an idea of what the "answer" is.

Just my 2 cents. (specialist physician, DW also a specialist physician) both <5 yrs out of training. Still drive the same 2006 model car I bought in med school. NW about 10x yours (helped by a bull run but pretty much through brute savings/living like a resident).
So you are saying I can but shouldn’t.

The way that I look at it is even if I buy the car, my net worth would still be on track to be about 10x what it is currently within five years. The forecast for my salary is: 250 in 2018, 400 in 2019, 450 in 2020, and 550+ after. My job also provides a pension.

That 10x NW target would be even more doable if I married another specialist physician, which is likely. Having said that, if I go with a cheaper car option, then I will get there that much faster.
I think the point is that you maybe heading down the path of overspending. Going back to a standard, basic car would be hard. And then in a year - a large 750k house to go with the Tesla. And on.....

Set yourself up for Financial success and wait until you are making 600k for a couple of years.
Last edited by Dottie57 on Fri Jun 29, 2018 5:37 pm, edited 1 time in total.

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TomatoTomahto
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Re: Can I buy a Tesla?

Post by TomatoTomahto » Fri Jun 29, 2018 5:36 pm

TimeRunner wrote:
Fri Jun 29, 2018 2:58 pm
Your billable time is too valuable to be hanging around a charging station. Gas and get to work! :D
Buy the Tesla and charge overnight at home. Your billable time is too valuable to be hanging around gas stations. 😎
Zero Net Carbon by 2019.

roflwaffle
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Re: Can I buy a Tesla?

Post by roflwaffle » Fri Jun 29, 2018 5:45 pm

TimeRunner wrote:
Fri Jun 29, 2018 2:58 pm
Your billable time is too valuable to be hanging around a charging station. Gas and get to work! :D
I was going to say their billable time to too valuable pumping gas (and maybe picking up whatever random virus is on the gas pump). Charge at home and never bother with a gas station! :D

PhilosophyAndrew
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Re: Can I buy a Tesla?

Post by PhilosophyAndrew » Fri Jun 29, 2018 5:54 pm

njdealguy wrote:
Fri Jun 29, 2018 3:37 pm
I'd research the kind of hassle and nightmare it can be to repair the tiniest body damages on a Tesla car before even considering whether to get it (think > $5000 to fix a tiny scratch as well as potentially months of waiting time while car is at the repair shop)

This factor alone for sure will keep me away from any interest in the brand for the time being.
How frequently do your scratch your cars? I’ve been driving for nealry 40 years and can’t remember any scratches that required repainting. (I did total one car as a teenager, alas.)

Perhaps this is a matter of aesthetic taste — I suppose if I believed that even tiny scratches required repainting, I’d spend a lot of time with my car in the shop.

I care about my car’s paint, and have a maintenance detail regularly — my detailed buffs out spaint wirls and minor scratches for me. He did find one last week that he couldn’t buff out (looked like someone had scratched the rear bumper in a parking lot), but the part that didn’t buff out he repaired for free with touch-up paint I supplied.

My wife isn’t at all fastidious about her cars paint, so I don’t expect she would bother to repaint her Tesla even if it got scratched up worse than I’ve seen in my driving life.

Andy.

Andy.

PhilosophyAndrew
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Re: Can I buy a Tesla?

Post by PhilosophyAndrew » Fri Jun 29, 2018 5:58 pm

OP, if your current car needs replacement, sure you can afford a new Model 3. However, if you already have safe and reliable transportation, I would focus on building up your net worth for the magic-of-compounding reasons others have discussed.

Also, with the EV technology improving quickly, waiting until your current car requires replacement means that you will have much better and even cooler electrical vehicle options.

Andy.

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knpstr
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Re: Can I buy a Tesla?

Post by knpstr » Fri Jun 29, 2018 6:04 pm

Given the provided information, that is fine. You can buy a $55k car with a quarter million dollar income.
Very little is needed to make a happy life; it is all within yourself, in your way of thinking. -Marcus Aurelius

Cramerica
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Re: Can I buy a Tesla?

Post by Cramerica » Fri Jun 29, 2018 6:37 pm

Sounds like there is a consensus I "can" buy a tesla.

But a number of you seem to think I shouldn't.

For those you who think I should "live like a resident" and wait to buy, what would be a target NW where you would feel comfortable advising me to pull the trigger? $500k? $1M?

randomguy
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Re: Can I buy a Tesla?

Post by randomguy » Fri Jun 29, 2018 7:01 pm

Cramerica wrote:
Fri Jun 29, 2018 6:37 pm
Sounds like there is a consensus I "can" buy a tesla.

But a number of you seem to think I shouldn't.

For those you who think I should "live like a resident" and wait to buy, what would be a target NW where you would feel comfortable advising me to pull the trigger? $500k? $1M?
When you have 10 million dollars and can retire with a 2% SWR.:)

Basic framework for any spending (house, car, watch,...)
a) Figure out when you want to retire (call it 55)
b) guess about how much you need
c) figure out how much you want to save
d) spend the rest on things that make you happy

What exactly d is up to you.If a car doesn't make you happy don't buy it. If it does you have to decide if that car is going to make you happier than the alternatives.

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White Coat Investor
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Re: Can I buy a Tesla?

Post by White Coat Investor » Fri Jun 29, 2018 7:15 pm

Cramerica wrote:
Fri Jun 29, 2018 6:37 pm
Sounds like there is a consensus I "can" buy a tesla.

But a number of you seem to think I shouldn't.

For those you who think I should "live like a resident" and wait to buy, what would be a target NW where you would feel comfortable advising me to pull the trigger? $500k? $1M?
I'd say $1M, but I'm not a car guy. If this is your ONLY splurge, then it's probably not a big deal. But if it also comes with a lifestyle upgrade to a nicer house and nicer vacations it's definitely too early.

Congrats on your success.
1) Invest you must 2) Time is your friend 3) Impulse is your enemy | 4) Basic arithmetic works 5) Stick to simplicity 6) Stay the course

Nate79
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Re: Can I buy a Tesla?

Post by Nate79 » Fri Jun 29, 2018 7:24 pm

Are you debt free and have the cash to buy it? If so then why not. You are going to build net worth fast. The risk is you use this justification every time you want to make a big and unneeded purchase.

carguyny
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Re: Can I buy a Tesla?

Post by carguyny » Fri Jun 29, 2018 7:40 pm

Even separating the financial from the car, keep in mind that the EV market is seeing a lot of new models over the next 12 to 24 months. Model 3 would be near the bottom of the list for me with the Porsche Taycan towards the top. You also have the Volvo XC40 EV, Audi e-tron, BMW x3 EV, Mercedes EQ3, Hyundai Kona EV etc all coming.

Good reason to wait and save more than keep watching for something you love.

TheAccountant
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Re: Can I buy a Tesla?

Post by TheAccountant » Fri Jun 29, 2018 7:49 pm

Do you really want a car that was rushed through QC to meet demand, and was basically made in a tent?

Your net worth is pretty low given your income. I'd work on that and drive whatever gets the job done for the least amount of money.

Can you afford it? I'm guessing you can write a check and pay for it when you go to pick it up, so if that's the case sure, you can afford it.

If you really want the car, I'd buy it and then daily drive something like I mentioned above to keep the miles off the 3 and keep resale up. If you don't want it after a year or two you can probably sell it for close to what you paid for it, given the current demand.

cuihang
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Re: Can I buy a Tesla?

Post by cuihang » Fri Jun 29, 2018 8:01 pm

ThriftyPhD wrote:
Fri Jun 29, 2018 5:27 pm
njdealguy wrote:
Fri Jun 29, 2018 4:44 pm
ThriftyPhD wrote:
Fri Jun 29, 2018 4:24 pm
njdealguy wrote:
Fri Jun 29, 2018 3:37 pm
I'd research the kind of hassle and nightmare it can be to repair the tiniest body damages on a Tesla car before even considering whether to get it (think > $5000 to fix a tiny scratch as well as potentially months of waiting time while car is at the repair shop)

This factor alone for sure will keep me away from any interest in the brand for the time being.
Over 10 years ago I was quoted several thousand dollars to fix a small scratch on my vehicle (mid range big three domestic brand). I was able to get the scratch repaired for a quarter of the cost by an independent shop. Turns out if you go to the dealer, they will charge you much more.

Now, the aluminum panels can be a challenge to paint and might raise costs while body shops retool. But all manufacturers are moving to aluminum, and one big benefit is that if it DOES scratch, it won't rust. If you're going to drive it till it breaks down, and aren't paranoid about every little scratch, you can just leave the small scratches since they won't rust.
I'm not talking about repairs at the dealer, am referring to posts I can see by googling where 'independent' shops that are authorized to fix Tesla cars taking months to complete the repair and charging multiple times more in the thousands for simple body repairs as compared to mainstream cars. Maybe this will change as you mention about more shops becoming proficient in working with aluminum car bodies.

Also I agree about living with small scratches, but what about the case where its instead an eyesore dent. I guess in that case it can be submitted as an insurance claim which could have been possibly avoided if the same repair on a conventional car were to cost 10% as much!
Could be a few things. Aluminum is, if not more difficult, a different style of painting that requires shops to retool. So any aluminum vehicle (Ford F150, Tesla, etc) would have the same issue. Two, there are no old Teslas. Even the older Model S vehicles will have enough residual value that the owner file an insurance claim and insist on a 'certified' repair. That means the repair will go through a body shop that is certified by Tesla. Combination of insurance + certified means most repairs will be done at the most expensive place in the state. If you're using insurance to pay for the repair, you're going to insist that the work be done at a Tesla Certified shop. There is no downward market pressure to provide price competition. Once you have more Telsas reach older age, and the cheaper, independent repair shops become an option, there will be more equalization of price. On top of that, until now all Teslas have been Model S or X, $70k + in value. I could be wrong, but I'm guessing taking any $70k car in for a repair is going to cost more than repairing a Honda Fit, even if the work is similar in difficulty and cost of materials.

That said, sounds like prices have come down some. Here's one post where someone with two dented panels and scratches that was charged $3k for the repairs. About what I was quoted to fix a much smaller issue on a mid range vehicle over a decade ago.
+1 to what said above. I have a Model S and got involved in an accident recently. I was told that it took several months to get it fixed because the parts were very slow to come in. Yes, tax and insurance are expensive too.

On the other hand, I really enjoy driving a Tesla and anxious waiting to get my car back from the body shop. You're young with a stable job and very high income. As long as you can plan well on your savings and debt pay-off, I don't see why you can't get one now. I probably spend too much on cars based on what I saw on this forum. :-)

randomguy
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Re: Can I buy a Tesla?

Post by randomguy » Fri Jun 29, 2018 8:05 pm

TheAccountant wrote:
Fri Jun 29, 2018 7:49 pm

If you really want the car, I'd buy it and then daily drive something like I mentioned above to keep the miles off the 3 and keep resale up. If you don't want it after a year or two you can probably sell it for close to what you paid for it, given the current demand.
So you can spend 5k drive a beater and get 5k more when you sell you Model 3 with low miles in a couple years. Optmizing for resale (either house or cars) has never struck me as a great way of living. I think expecting demand to be high in 12-24 months is being optimistic. Demand for these type of cars dissipate quickly as production ramps. OP might do ok with tax credit phaseout but given the huge number of alternatives hitting the market over the next 6-36 months, I wouldn't bet on it.

HornedToad
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Re: Can I buy a Tesla?

Post by HornedToad » Fri Jun 29, 2018 8:45 pm

Your question makes it look like you mean the Model S for $70-120k.

If it's just the Model 3 for $35-45k then you're generally fine. Although with all the extras Model 3 can be more. Keep it under $40-45k and that's fine.

randomguy
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Re: Can I buy a Tesla?

Post by randomguy » Fri Jun 29, 2018 10:12 pm

HornedToad wrote:
Fri Jun 29, 2018 8:45 pm
Your question makes it look like you mean the Model S for $70-120k.

If it's just the Model 3 for $35-45k then you're generally fine. Although with all the extras Model 3 can be more. Keep it under $40-45k and that's fine.
You cant buy a 45k model 3 today. They all come with the battery and interior options that push the price to 50k.

somekevinguy
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Re: Can I buy a Tesla?

Post by somekevinguy » Fri Jun 29, 2018 10:28 pm

Cramerica wrote:
Fri Jun 29, 2018 6:37 pm
Sounds like there is a consensus I "can" buy a tesla.

But a number of you seem to think I shouldn't.

For those you who think I should "live like a resident" and wait to buy, what would be a target NW where you would feel comfortable advising me to pull the trigger? $500k? $1M?
Not really about NW. What are your other goals? Any desire to buy a house in the next 3 years? If so, I'd say it is probably worthwhile saving up for a downpayment (the 20% kind, not the doctor loan kind). Are you putting away enough to meet your retirement savings goals/timeline? Do you have the cash to buy the Tesla? If not, then it may be worth saving up until you can actually buy it in cash rather than financing etc. Why carry around debt (even at a low interest rate)- just pay it off and be done with it. Like WCI mentioned, any other purchases you're planning (the doctor house, the doctor vacation, etc etc)? Lastly, do you actually need a car right now (still haven't heard what you're upgrading from)- if you don't, there are a lot of advantages to not upgrading at this time.

There are plenty of things you can do. Heck, Warren Buffet could drive a new luxury car every week for the rest of his life and be fine but chooses to drive a Cadillac and live in a modest home. Just gotta allocate your dollars to what brings you the most joy- "you can have anything you want, just not everything you want"

All that being said, if you love cars and love Teslas and that's what brings you joy, then by all means, live your life.

Big Dog
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Re: Can I buy a Tesla?

Post by Big Dog » Fri Jun 29, 2018 10:37 pm

does your state offer any rebates? I just received a check for $2500 from California for my M3 purchase. Add in the $7500 federal tax savings, and it takes the purchase price down $10k. A really nice discount, IMO.

ThePrince
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Re: Can I buy a Tesla?

Post by ThePrince » Fri Jun 29, 2018 11:02 pm

TravelGeek wrote:
Fri Jun 29, 2018 3:51 pm
Have you read today's post on White Coat Investor?

https://www.whitecoatinvestor.com/how-t ... in-hawaii/
# 3 Drive Beater(s) or Bike

Instead of upgrading the cars, downgrade the cars. I’m amazed what some people think is necessary in order to have a “reliable car.” I’ve had $2K cars that were plenty reliable (had to get one jump start in four years, drove over to AutoZone and got a new battery on the way home.) My next car was $4K. A great deal of the reason I was a millionaire 7 years out of residency on half of your income was that we didn’t spend much on cars. Or here’s an idea. Ride your bike to work. I did during residency and most of those first four years.
While your income would support the vehicle (IMO), I personally would not spend my hard earned dollars on that vehicle at this point in your life and career.
+1

bubbadog
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Re: Can I buy a Tesla?

Post by bubbadog » Fri Jun 29, 2018 11:08 pm

Cramerica,

Just use your royalties from either the manzier or your oil tanker bladder system to pay for the car in cash! :moneybag :moneybag

abonder
Posts: 226
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Re: Can I buy a Tesla?

Post by abonder » Sat Jun 30, 2018 12:19 am

This thread touches on so many Boglehead hot buttons...cars, especially Tesla, lifestyle inflation, etc.

I’m in the camp that you should wait. It’s not that you can’t afford it (you can) but the whole live like a resident thing is really the clear path to success. If you can basically live your current existence unchanged for a couple of years, You’ll create a trajectory for success that will be nearly impossible to mess up.

Also, I’m of the (possibly minority) opinion that driving a fancy car as a physician straight out of training is truly one the top “stupid doctor tricks.” Also, thinking about and researching a new car will always be more fun than actually owning it. Best of luck to you.

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