Am I crazy to get Tesla Model Y?

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Topic Author
Mongoose
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Am I crazy to get Tesla Model Y?

Post by Mongoose »

Need a sanity check because I am considering doing something that might not be wise.

We are a 1 car family. We need a new car in the next few months. Want to purchase a Tesla Model Y which should come to about $55k out the door.
After trade in I would need $38k to pay cash. Only other debt is about $100k on a $550k house. This would be the 3rd car I have owned as we typically keep our cars for as long as possible (10+ years) other then the one car that was totaled which caused us to impulse buy this POS Jeep Grand Cherokee that is falling apart after 4 years. Most I have ever spent on a car is $30k, but after looking it seems like cars are just so expensive these days (we want something larger then a sedan and do not want a van).

Total net worth is close to $1.5mil at age 33. Technically I could sell the house we live in and FIRE today as we for the most part live very modestly. Majority (all but about $30k and the $450k house equity is in retirement accounts). Of the taxable, $20k is earmarked for college for the kid and the $10k is used to pay bills/emergency. I would use some of this pay for the car.

I max HSA, 401k and normally save about $1k/month in taxable.

I say this to show that we are doing alright and by most measures can "afford" the car.

Would I be crazy to open a HELOC to pay about 35k? Rates seem to be low at about 2.25%. Tesla also offers a 2.49%.
I could use the $1k/ month we save in taxable to pay down the loan in 35 months. I could also just not put so much in my 401k to help pay off amount faster.

Crazy?
vasaver
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Re: Am I crazy to get Tesla Model Y?

Post by vasaver »

Go for it - but just realize that it will depreciate like any other semi-luxury car.

Here are some real depreciation numbers on a 2018 model 3 after 2 years (not Musk math)

$61,700.00 price
$6,396.30 tax
$68,096.30 total
$60,596.30 after 7500 tax credit

1) vroom - $38,642
2) shift - $39,100
3) carvana - $36,341

https://teslamotorsclub.com/tmc/threads ... wd.211277/
bzcat
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Re: Am I crazy to get Tesla Model Y?

Post by bzcat »

Is getting an electric car a specific criteria?

When researching, I rate shopped the Tesla insurance vs a brand version of our current electric car. The rate hike for the Tesla was an untenable hidden cost.

Do you live in one of the ten states that can buy the Kona Electric, the 12 states that can buy the Niro Ev, or can you wait until March for the VW ID.4? All of these are cheaper and similar.
kevdude
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Re: Am I crazy to get Tesla Model Y?

Post by kevdude »

I say go for it. We just ordered one for my wife, which we'll pay for in cash but we are much older (57) and in much different financial shape and stage.

Congrats on your financial success so far! I do think, however, that maybe you should bump up your taxable accounts a bit. Someone with a net worth of $1.5 million should have a solid emergency fund and cash for situations such as this or other big ticket items like a new roof, house improvements, etc.

Regarding using a loan for the purchase, I wouldn't be averse to it at a low rate, but I would certainly pay it off quickly.

Keep up the good work (but build up those reserves)!
Normchad
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Re: Am I crazy to get Tesla Model Y?

Post by Normchad »

You’re doing great financially. If you want to buy a $55K car, go for it.
Topic Author
Mongoose
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Re: Am I crazy to get Tesla Model Y?

Post by Mongoose »

bzcat wrote: Sun Nov 01, 2020 10:13 pm Is getting an electric car a specific criteria?

When researching, I rate shopped the Tesla insurance vs a brand version of our current electric car. The rate hike for the Tesla was an untenable hidden cost.

Do you live in one of the ten states that can buy the Kona Electric, the 12 states that can buy the Niro Ev, or can you wait until March for the VW ID.4? All of these are cheaper and similar.
Not 100% required but as we plan to keep this next vehicle for 10 or more years I think it would great to have one. Insurance cost is a good point. I will call tomorrow to check. I. Hesitant to go with a "new" company for this type of thing as there is a lot that can go wrong. Although I will admit I have not researched the vehicles you mentioned. I will spend some time doing that.
harrychan
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Re: Am I crazy to get Tesla Model Y?

Post by harrychan »

Please don't open a HELOC to pay for this. If you don't need the car immediately, wait and keep saving cash. I bought a bunch of TSLA earlier this year and am letting it sit until the RWD is available.
This is not legal or certified financial advice but you know that already.
Topic Author
Mongoose
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Re: Am I crazy to get Tesla Model Y?

Post by Mongoose »

kevdude wrote: Sun Nov 01, 2020 10:17 pm I say go for it. We just ordered one for my wife, which we'll pay for in cash but we are much older (57) and in much different financial shape and stage.

Congrats on your financial success so far! I do think, however, that maybe you should bump up your taxable accounts a bit. Someone with a net worth of $1.5 million should have a solid emergency fund and cash for situations such as this or other big ticket items like a new roof, house improvements, etc.

Regarding using a loan for the purchase, I wouldn't be averse to it at a low rate, but I would certainly pay it off quickly.

Keep up the good work (but build up those reserves)!
This is what keeps me up at night. Everytime I get the reserves up there a new large ticket item finds us. I do have 35k of Roth principle I could tap if needed but that is for extreme cases.
Topic Author
Mongoose
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Re: Am I crazy to get Tesla Model Y?

Post by Mongoose »

harrychan wrote: Sun Nov 01, 2020 10:37 pm Please don't open a HELOC to pay for this. If you don't need the car immediately, wait and keep saving cash. I bought a bunch of TSLA earlier this year and am letting it sit until the RWD is available.
The problem is the Jeep is junk and needs a new transmission and some other big ticket items at 55k miles.....I am trying to get rid of it asap to at least recoup as much as I can. 1 car family so we need something. I guess we could buy another cheapo hold over but why at 2.5% apr? I kind of agree with the heloc and might just do a 5 year Tesla loan and shoot to pay it off in 2.
Archimedes
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Re: Am I crazy to get Tesla Model Y?

Post by Archimedes »

I kept my 1st Tesla Model S for 8 years. It was very expensive to buy, double what my other vehicles had cost. But it was very cheap to run, and after 8 years I sold it for 29k. Overall it was great and I would do it again. Now I drive a Model Y, and I love it!
vasaver
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Re: Am I crazy to get Tesla Model Y?

Post by vasaver »

Mongoose wrote: Sun Nov 01, 2020 10:43 pm
harrychan wrote: Sun Nov 01, 2020 10:37 pm Please don't open a HELOC to pay for this. If you don't need the car immediately, wait and keep saving cash. I bought a bunch of TSLA earlier this year and am letting it sit until the RWD is available.
The problem is the Jeep is junk and needs a new transmission and some other big ticket items at 55k miles.....I am trying to get rid of it asap to at least recoup as much as I can. 1 car family so we need something. I guess we could buy another cheapo hold over but why at 2.5% apr? I kind of agree with the heloc and might just do a 5 year Tesla loan and shoot to pay it off in 2.
Look at a Chevy Bolt to see if electric is the right fit. 3 year old car for 12-15k. Fully loaded Premier with all of the options and safety features (Driver Confidence II & Infotainment Package) and 200 mile+ range.

https://www.autotrader.com/cars-for-sal ... ds=25&dma=
TravelGeek
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Re: Am I crazy to get Tesla Model Y?

Post by TravelGeek »

bzcat wrote: Sun Nov 01, 2020 10:13 pm
Do you live in one of the ten states that can buy the Kona Electric, the 12 states that can buy the Niro Ev, or can you wait until March for the VW ID.4? All of these are cheaper and similar.
vasaver wrote: Sun Nov 01, 2020 11:08 pm
Look at a Chevy Bolt to see if electric is the right fit. 3 year old car for 12-15k. Fully loaded Premier with all of the options and safety features (Driver Confidence II & Infotainment Package) and 200 mile+ range.
I don’t think any of these options meet this requirement:
Mongoose wrote: Sun Nov 01, 2020 9:58 pm Most I have ever spent on a car is $30k, but after looking it seems like cars are just so expensive these days (we want something larger then a sedan and do not want a van).
wizardofoz1
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Re: Am I crazy to get Tesla Model Y?

Post by wizardofoz1 »

No, don't.

Overpriced and would never own a Tesla outside warranty. Meaning you would have to sell after 4 years. Cheaper and more reliable EV's coming soon. We own 2 Tesla's, been to the service center 5 times already! Replaced touchcreen and daighter board. Luckily under warranty. OtherwiseI wpuld be out at least $3000.

Quality isreally really bad. Why do you think Tesla changed their used car warranty to 1 year from 4 years? They are losing millions on warranty repairs. Shows you Tesla doesn'y have faith in the quality of their cars.
Valuethinker
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Re: Am I crazy to get Tesla Model Y?

Post by Valuethinker »

Mongoose wrote: Sun Nov 01, 2020 10:43 pm
harrychan wrote: Sun Nov 01, 2020 10:37 pm Please don't open a HELOC to pay for this. If you don't need the car immediately, wait and keep saving cash. I bought a bunch of TSLA earlier this year and am letting it sit until the RWD is available.
The problem is the Jeep is junk and needs a new transmission and some other big ticket items at 55k miles.....I am trying to get rid of it asap to at least recoup as much as I can. 1 car family so we need something. I guess we could buy another cheapo hold over but why at 2.5% apr? I kind of agree with the heloc and might just do a 5 year Tesla loan and shoot to pay it off in 2.
As a one car family, you can definitely afford this. Given your level of savings at your age. It's not unreasonable to spend $50k (you should aim for less, but get the *right* car, and *keep* it, and you will do fine - my father used to replace his cars every 10-12 years).

Question is Is an Electric Vehicle for me?

Can you rent a Tesla for a couple of weeks and find out?

For example if you plan family driving holidays, it may not be the right vehicle. Ditto if you do actual offroading (unfortunately, Land Rovers have very poor reliability as well, so I cannot tell you to "buy British" ;-)).

There will be a lot more EVs on the market in 1-3 years. Europe is going full out on net zero, and European car makers are readying the model ranges. I expect Japan will follow suit, and China.

You need a vehicle now, and it may be that the market is just not ready to provide what you would need in an EV (in a vehicle, that an EV might or might not meet).
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4nursebee
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Re: Am I crazy to get Tesla Model Y?

Post by 4nursebee »

wizardofoz1 wrote: Mon Nov 02, 2020 2:30 am No, don't.

Overpriced and would never own a Tesla outside warranty. Meaning you would have to sell after 4 years. Cheaper and more reliable EV's coming soon. We own 2 Tesla's, been to the service center 5 times already! Replaced touchcreen and daighter board. Luckily under warranty. OtherwiseI wpuld be out at least $3000.

Quality isreally really bad. Why do you think Tesla changed their used car warranty to 1 year from 4 years? They are losing millions on warranty repairs. Shows you Tesla doesn'y have faith in the quality of their cars.
Great first post LOL
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TomatoTomahto
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Re: Am I crazy to get Tesla Model Y?

Post by TomatoTomahto »

If you never take long trips in a car, I would consider some of the “off brands.” For me, it would be Polestar 2. Apparently a great car, and with quality Volvo seats.

For now, the only long trip option is Tesla.
I get the FI part but not the RE part of FIRE.
Jack FFR1846
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Re: Am I crazy to get Tesla Model Y?

Post by Jack FFR1846 »

A few questions....

Why a HELOC when car rates are lower? If you're in an area served by DCU, join and take a loan there. Their rates are consistently low.

Why a Model Y? Have you driven one? Don't listen to the hype....drive one yourself. I drove a model S after hearing all the "it will transform your life and give the world peace forever" kinds of claims. I was underwhelmed by the car and felt that although it was finished much nicer than I expected, it really seemed like a $40k car....not an $85k car. Drive one.

The obvious question......why do you need such an expensive car? For half of that $50k, you could buy a Subaru Crosstrek. No, it won't go 0-60 in 6 miliseconds, but who cares? No, really? I have 25 years of track competition, lots of class wins and 2 track records and I drive a Crosstrek on the street. If I want to go fast, I'm not going to do it on public roadways.

Savings: Do your own math. I've done this many times. Now I'm an outlier because I take advantage of my grocery store gas points program with credit card rewards and gift cards converted into money orders. I'm also in a relatively high electric area (20 cents per kWHr). My Crosstrek always beats every Tesla for cost per mile, but my gas hacks helps that. I estimate I pay on average 88 cents a gallon. This weekend, my fillup cost 38.9 cents a gallon.
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mmmodem
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Re: Am I crazy to get Tesla Model Y?

Post by mmmodem »

I don't think you're crazy to buy a Model Y. Your assets indicate you can afford it. I'd forgo any creative financing, though. Either pay cash or finance the Tesla. The rate difference you quoted are negligible to risk a HELOC. I also wouldn't decrease 401k saving. All that does is increase your taxes causing you to pay more for the vehicle.

FWIW, we're waiting for the third row Model Y to come out. It will give Tesla a few more months (years?) to improve their reliability. We can pay cash but would rather not deplete an emergency fund or incur capitol gains by selling in taxable. This is not an emergency and as said before, we don't want to add to the costs of the Model Y. I will absolutely continue to max out tax advantaged accounts to hold a 2.5% loan.
RTF
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Re: Am I crazy to get Tesla Model Y?

Post by RTF »

Mongoose wrote: Sun Nov 01, 2020 10:43 pm
harrychan wrote: Sun Nov 01, 2020 10:37 pm Please don't open a HELOC to pay for this. If you don't need the car immediately, wait and keep saving cash. I bought a bunch of TSLA earlier this year and am letting it sit until the RWD is available.
The problem is the Jeep is junk and needs a new transmission and some other big ticket items at 55k miles.....I am trying to get rid of it asap to at least recoup as much as I can. 1 car family so we need something. I guess we could buy another cheapo hold over but why at 2.5% apr? I kind of agree with the heloc and might just do a 5 year Tesla loan and shoot to pay it off in 2.

Just out of curiosity, if the transmission needs replaced, why not take it in and get it repaired under your power train warranty? You should have until 60k to do so. I think you’ll agree, it isn’t the norm to have a transmission failure and other big ticket items failing at that low of mileage. If you think a Grand Cherokee is a POS, you could be in for a rude awakening when buying a Tesla. They are wonderful vehicles and without a doubt the future, but they do have some fit and finish/gremlin issues often associated with them. Having said that, you can definitely afford this, I say go for it.
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Mongoose
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Re: Am I crazy to get Tesla Model Y?

Post by Mongoose »

RTF wrote: Mon Nov 02, 2020 7:33 am
Mongoose wrote: Sun Nov 01, 2020 10:43 pm
harrychan wrote: Sun Nov 01, 2020 10:37 pm Please don't open a HELOC to pay for this. If you don't need the car immediately, wait and keep saving cash. I bought a bunch of TSLA earlier this year and am letting it sit until the RWD is available.
The problem is the Jeep is junk and needs a new transmission and some other big ticket items at 55k miles.....I am trying to get rid of it asap to at least recoup as much as I can. 1 car family so we need something. I guess we could buy another cheapo hold over but why at 2.5% apr? I kind of agree with the heloc and might just do a 5 year Tesla loan and shoot to pay it off in 2.

Just out of curiosity, if the transmission needs replaced, why not take it in and get it repaired under your power train warranty? You should have until 60k to do so. I think you’ll agree, it isn’t the norm to have a transmission failure and other big ticket items failing at that low of mileage. If you think a Grand Cherokee is a POS, you could be in for a rude awakening when buying a Tesla. They are wonderful vehicles and without a doubt the future, but they do have some fit and finish/gremlin issues often associated with them. Having said that, you can definitely afford this, I say go for it.
Unfortunately the warranty expired this past year- it is a 2014 with very low mileage. Many other things are just falling apart on it too. I have heard about the Tesla fit and finish issues but I have talked to at least 3 friends who have not seen any of that on their model 3s and have had zero issues in the first 2 years. I can deal with some minor fit/finish problems- I can't deal with a transmission going out at 55k miles.

We also looked at the Subaru Ascent which I love (the wife doesn't) but then I also read up on how the Ascent reliability is horrible (which is uncharacteristic for Subaru).
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Mongoose
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Re: Am I crazy to get Tesla Model Y?

Post by Mongoose »

Jack FFR1846 wrote: Mon Nov 02, 2020 7:17 am A few questions....

Why a HELOC when car rates are lower? If you're in an area served by DCU, join and take a loan there. Their rates are consistently low.

Why a Model Y? Have you driven one? Don't listen to the hype....drive one yourself. I drove a model S after hearing all the "it will transform your life and give the world peace forever" kinds of claims. I was underwhelmed by the car and felt that although it was finished much nicer than I expected, it really seemed like a $40k car....not an $85k car. Drive one.

The obvious question......why do you need such an expensive car? For half of that $50k, you could buy a Subaru Crosstrek. No, it won't go 0-60 in 6 miliseconds, but who cares? No, really? I have 25 years of track competition, lots of class wins and 2 track records and I drive a Crosstrek on the street. If I want to go fast, I'm not going to do it on public roadways.

Savings: Do your own math. I've done this many times. Now I'm an outlier because I take advantage of my grocery store gas points program with credit card rewards and gift cards converted into money orders. I'm also in a relatively high electric area (20 cents per kWHr). My Crosstrek always beats every Tesla for cost per mile, but my gas hacks helps that. I estimate I pay on average 88 cents a gallon. This weekend, my fillup cost 38.9 cents a gallon.
I actually love Subaru- the car that was totaled at 1 year was an Outback and it saved my life. I like the Ascent, but my wife is not a huge fan (the Crosstrek would be too small). The issue with the Ascent is, from what most reports say, the reliability is not on par with Subaru- it is not a vehicle that will last. The Ascent we are looking at would be close to 42k out the door. This kind of scares me as this is the car I will give to my child when she starts driving in 12 years.

As far as the Tesla, we like the idea of an EV, this will be our only vehicle so we like how the range and supercharge network is massive compared to other EVs, and the software updates are fascinating to me- what other car can you get constant upgrades via download- for free. We have test driven a Model 3 and the wife is sold- I am kind of with you- underwhelmed for the cost. Mostly I am just ready to get this Grand Cherokee out of our lives.
dcd72
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Re: Am I crazy to get Tesla Model Y?

Post by dcd72 »

I have no opinion about Tesla v. other electric car v. internal combustion engine. But whatever you buy, don't take out a HELOC to pay for it (!!) and definitely don't decrease 401k contributions to pay for it (!!!).
Dave55
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Re: Am I crazy to get Tesla Model Y?

Post by Dave55 »

Yes go for the Tesla, you are not crazy. I have a 2019 Subaru Ascent I have had since July 2018, 15,000 miles and no problems and I enjoy driving it. My wife has a 2018 Forester and she wanted to get an electric car, so we test drove the Tesla Y and X a few weeks ago. Then she decided she didn't want the Tesla and would keep her Forester which really makes sense for her as she drives about 4000 miles a year.

Dave
Nysoz
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Re: Am I crazy to get Tesla Model Y?

Post by Nysoz »

TomatoTomahto wrote: Mon Nov 02, 2020 7:05 am If you never take long trips in a car, I would consider some of the “off brands.” For me, it would be Polestar 2. Apparently a great car, and with quality Volvo seats.

For now, the only long trip option is Tesla.
https://robbreport.com/motors/cars/pole ... 234578366/

As more and more OEMs build EVs they'll realize building an EV isn't quite the same as building an ICE vehicle. I'm sure they'll get it but they'll have hiccups along the way as well.

Anyways, I've had my model 3 for 1.5 years and 32k miles. No major issues, but did have minor fit and finish problems fixed in my driveway by the mobile tech. Personally saving around $200 a month in gas vs electricity. Personally next vehicle will still be another Tesla unless another OEM steps up and delivers a car that's equivalent in efficiency and safety while allowing me to drive across country to family in a reasonable amount of time.

Financially you can afford it, but make sure you can charge at home/work and test drive it and competitors to see if it's a fit for you personally.
bloom2708
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Re: Am I crazy to get Tesla Model Y?

Post by bloom2708 »

For a "one car" family, I would pass on the Tesla.

Currently, they are set up to be a second car. Just my opinion.

Do you have 240v in your garage? Do you take any 500+ mile trips?

You can get some pretty nice cars for $35k to $40k. Plus, taking out a HELOC or raiding the Roth are not good options.
"We are here to provoke thoughtfulness, not agree with you." Unknown Boglehead
Pomegranate
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Re: Am I crazy to get Tesla Model Y?

Post by Pomegranate »

Mongoose wrote: Sun Nov 01, 2020 9:58 pm Need a sanity check because I am considering doing something that might not be wise.

We are a 1 car family. We need a new car in the next few months. Want to purchase a Tesla Model Y which should come to about $55k out the door.


Crazy?
You mean you'd have only 1 vehicle and it'd be electric?
Don't really understand how it works - what if you want to hit the road and visit few national parks on a long weekend (1-2 kilo miles)?
It's good to have an electric for short commutes but hybrid/gas should be the second backup car then
dknightd
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Re: Am I crazy to get Tesla Model Y?

Post by dknightd »

Pomegranate wrote: Mon Nov 02, 2020 9:52 am You mean you'd have only 1 vehicle and it'd be electric?
Don't really understand how it works - what if you want to hit the road and visit few national parks on a long weekend (1-2 kilo miles)?
It's good to have an electric for short commutes but hybrid/gas should be the second backup car then
I agree. I'd be very reluctant to not have a car that could run on good old fashioned gasoline.
If you value a bird in the hand, pay off the loan. If you are willing to risk getting two birds (or none) from the market, invest the funds. Retired 9/19. Still working on mortgage payoff.
finanzfrau
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Re: Am I crazy to get Tesla Model Y?

Post by finanzfrau »

We have a Volt and love it. We are a 1 car family and so we are saving a lot on gas right now.
As for going to national parks, I did see Tesla Chargers at Yellowstone this September.
We rented a Pacifica for a 2 week road trip mainly for the space and did not want to put more mileage on our car.
chillwill120
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Re: Am I crazy to get Tesla Model Y?

Post by chillwill120 »

Buy a Prius V and call it a day. Not as sexy, not as fast, but waaaaay more affordable and reliable. Plus it sips gas. In a few years when the mortgage is fully paid off and you are in a position to buy a car with cash, then reconsider. At that point Teslas might be more affordable and/or reliable, or there might be alternatives that work better for you.
EnjoyIt
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Re: Am I crazy to get Tesla Model Y?

Post by EnjoyIt »

I am usually one of those people that say pay cash for luxury, but in your situation being more or less financially independent and still working, I don’t see taking out a car loan and then paying it off as soon as reasonable being a bad thing.

Is a Tesla the right car for you, only you can answer. Do some research and if the answer is yes, it’s okay to splurge on some luxury every now and again especially if you can afford it. And yes, I think you can afford it.

I also want to point out that in several years you will have over $2 million in your tax protected accounts. You may be a good candidate for Roth contributions if the plan is to keep working and saving as you currently are.
Last edited by EnjoyIt on Mon Nov 02, 2020 10:43 am, edited 1 time in total.
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vasaver
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Re: Am I crazy to get Tesla Model Y?

Post by vasaver »

chillwill120 wrote: Mon Nov 02, 2020 10:32 am Buy a Prius V and call it a day. Not as sexy, not as fast, but waaaaay more affordable and reliable. Plus it sips gas. In a few years when the mortgage is fully paid off and you are in a position to buy a car with cash, then reconsider. At that point Teslas might be more affordable and/or reliable, or there might be alternatives that work better for you.
Couldn't have said it better myself. We have a 2012 Prius V in the driveway with 110k miles on it (minimal maintenance required) and a 2015 Nissan Leaf as the daily driver. People love to hate, but the savings in the 529 are real.
Last edited by vasaver on Mon Nov 02, 2020 10:43 am, edited 1 time in total.
Pomegranate
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Re: Am I crazy to get Tesla Model Y?

Post by Pomegranate »

finanzfrau wrote: Mon Nov 02, 2020 10:26 am
As for going to national parks, I did see Tesla Chargers at Yellowstone this September.
I'm not saying it's impossible but it'd add a lot of charging overhead to the trip time :sharebeer
CeeKay1729
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Re: Am I crazy to get Tesla Model Y?

Post by CeeKay1729 »

Financially you can afford it but I would wait until 2nd gen Y. My cousin just got the Y and he's having so many QC issues with it. The car is constantly in the shop and Tesla customer service is horrible.
wickywack
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Re: Am I crazy to get Tesla Model Y?

Post by wickywack »

dknightd wrote: Mon Nov 02, 2020 10:12 am
Pomegranate wrote: Mon Nov 02, 2020 9:52 am You mean you'd have only 1 vehicle and it'd be electric?
Don't really understand how it works - what if you want to hit the road and visit few national parks on a long weekend (1-2 kilo miles)?
It's good to have an electric for short commutes but hybrid/gas should be the second backup car then
I agree. I'd be very reluctant to not have a car that could run on good old fashioned gasoline.
Rent. That's what I did even before I had an electric car. The car I preferred for daily driving (urban, small streets, street parking) was never the car I preferred for long road trips (large, comfortable, sometimes room for guests). I'd buy for daily use and rent for the once in a blue moon road trip.

I switched to a small electric 3 years ago. It matches my 99.9% use case even better since I have access to a home charger.
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gr7070
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Re: Am I crazy to get Tesla Model Y?

Post by gr7070 »

Mongoose wrote: Sun Nov 01, 2020 9:58 pm Crazy?
Yes.

You're crazy for even asking. I wouldn't even consider it that expensive a car. Even though it's far more than I've ever spent on one.
Mongoose wrote: Sun Nov 01, 2020 10:40 pm This is what keeps me up at night.
Mongoose wrote: Sun Nov 01, 2020 9:58 pm Technically ... FIRE today
Umm. Nothing financial should be keeping you up at night. You're FI.

And you're 33.

You're 33, you're FI, and you have stress and concerns over your emergency fund and buying a vehicle. You have some irrational views on money and saving/spending it.

I'd suggest creating some budget line items for spending - to allow you to spend reasonably and without anxiety. Certainly a vehicle budget should be one, but very likely additional items.
dknightd
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Re: Am I crazy to get Tesla Model Y?

Post by dknightd »

Renting as needed is a perfectly reasonable option. You could probably drive a Tesla from coast to coast. With a little planning, no need to rent. We really only need one car. It could be electric. But for now we decided having a second car available is worth the expense. I know, it is wasteful. But having that second car available, at any time, is money I'm willing to waste.
If you value a bird in the hand, pay off the loan. If you are willing to risk getting two birds (or none) from the market, invest the funds. Retired 9/19. Still working on mortgage payoff.
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Mongoose
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Re: Am I crazy to get Tesla Model Y?

Post by Mongoose »

One thing I have never considered is leasing. Does this ever make sense?

What Tesla shows for the Y is $4500 down, 3 year lease, 10,000 miles annual (we historically don't drive more then this). $512/month.
That comes out to $23k for the lease. If I sold the Jeep I get about 18k which I could just use to pay the monthly amount/invest while holding.

I could then buy the next gen Y if we like it, or say no thank you and just get a conventional if it is horrible. The money I could "save" by not spending could just be thrown into a car account to grow for 3 years until we are ready to buy again?

I have never been a lease person but just trying to think things through logically.
EnjoyIt
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Re: Am I crazy to get Tesla Model Y?

Post by EnjoyIt »

dknightd wrote: Mon Nov 02, 2020 11:16 am Renting as needed is a perfectly reasonable option. You could probably drive a Tesla from coast to coast. With a little planning, no need to rent. We really only need one car. It could be electric. But for now we decided having a second car available is worth the expense. I know, it is wasteful. But having that second car available, at any time, is money I'm willing to waste.
Yes, one can drive coast to coast in a Tesla with planning, but this is not how we road trip. The destination is predetermined the route and timing is made up as we go. Some days we drive for 3 hours, some days we drive for 6 hours. Some days we spend 2 nights, some days we spend 3. Plus, we prefer to eat healthy and charging station food options are rarely on our menu.

I like the idea of a two car family such as ours having 1 electric and one travel IC SUV. I would hate road tripping in a Tesla. One day traveling in an electric will be how we like it. Today is not the day.
A time to EVALUATE your jitters: | https://www.bogleheads.org/forum/viewtopic.php?f=10&t=79939&start=400#p5275418
dknightd
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Re: Am I crazy to get Tesla Model Y?

Post by dknightd »

Owning a car is not logical. Just for fun, figure out how much it would cost you to call a cab every day. I suspect it would be cheaper than leasing a model y.

Edit: if you want to drive across country, rent an RV ???
Last edited by dknightd on Mon Nov 02, 2020 11:48 am, edited 1 time in total.
If you value a bird in the hand, pay off the loan. If you are willing to risk getting two birds (or none) from the market, invest the funds. Retired 9/19. Still working on mortgage payoff.
harrychan
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Re: Am I crazy to get Tesla Model Y?

Post by harrychan »

Mongoose wrote: Mon Nov 02, 2020 11:21 am One thing I have never considered is leasing. Does this ever make sense?

What Tesla shows for the Y is $4500 down, 3 year lease, 10,000 miles annual (we historically don't drive more then this). $512/month.
That comes out to $23k for the lease. If I sold the Jeep I get about 18k which I could just use to pay the monthly amount/invest while holding.

I could then buy the next gen Y if we like it, or say no thank you and just get a conventional if it is horrible. The money I could "save" by not spending could just be thrown into a car account to grow for 3 years until we are ready to buy again?

I have never been a lease person but just trying to think things through logically.
No. It doesn't make sense to lease a Tesla. Once your lease is over, you will be out of a car and you will be back to square one. Lease only works for those who can somehow have some tax benefits from their business.

I think the logical thing to do is take a step back and do some reading on your financial position and your needs. From reading your posts, it seems for someone with such assets, you should be much more familiar with the nuts and bolts of basic financial management. Read through Bogleheads book, the wiki here or even Total Money Makeover by Dave Ramsey.
This is not legal or certified financial advice but you know that already.
dknightd
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Re: Am I crazy to get Tesla Model Y?

Post by dknightd »

Why a model Y ?
If you value a bird in the hand, pay off the loan. If you are willing to risk getting two birds (or none) from the market, invest the funds. Retired 9/19. Still working on mortgage payoff.
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Mongoose
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Re: Am I crazy to get Tesla Model Y?

Post by Mongoose »

dknightd wrote: Mon Nov 02, 2020 12:10 pm Why a model Y ?
Larger then the 3.
Olemiss540
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Re: Am I crazy to get Tesla Model Y?

Post by Olemiss540 »

You are getting out of this "nightmare" of reliability and into a Tesla?

You should solve the reliability problem and buy something known to routinely make it 200k miles with minimal maintenance. I would personally sell the Cherokee and buy a RX350 for $20-25k with 50k miles on it. Drive it for 10 years (around 100k miles for you) and sell it for $8k. By that time you will have enough cash sitting around to buy whatever you want after suffering through a Lexus for 10 years.
I hold index funds because I do not overestimate my ability to pick stocks OR stock pickers.
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Mongoose
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Re: Am I crazy to get Tesla Model Y?

Post by Mongoose »

harrychan wrote: Mon Nov 02, 2020 11:44 am
Mongoose wrote: Mon Nov 02, 2020 11:21 am One thing I have never considered is leasing. Does this ever make sense?

What Tesla shows for the Y is $4500 down, 3 year lease, 10,000 miles annual (we historically don't drive more then this). $512/month.
That comes out to $23k for the lease. If I sold the Jeep I get about 18k which I could just use to pay the monthly amount/invest while holding.

I could then buy the next gen Y if we like it, or say no thank you and just get a conventional if it is horrible. The money I could "save" by not spending could just be thrown into a car account to grow for 3 years until we are ready to buy again?

I have never been a lease person but just trying to think things through logically.
No. It doesn't make sense to lease a Tesla. Once your lease is over, you will be out of a car and you will be back to square one. Lease only works for those who can somehow have some tax benefits from their business.

I think the logical thing to do is take a step back and do some reading on your financial position and your needs. From reading your posts, it seems for someone with such assets, you should be much more familiar with the nuts and bolts of basic financial management. Read through Bogleheads book, the wiki here or even Total Money Makeover by Dave Ramsey.
Probably not a bad idea for a refresher. Bogleheads guide to investing was the first finance book I read at age 16. I started maxing my Roth from the time I finished. I would say I have done quite well by following the philosophies my entire life; however, as we see here I am very retirement age oriented when I have known in the back of my mind for a long time that I didn't want to have to work past 40. In hindsight I should have taken a more FIRE approach, but again I am not complaining- we have saved a ton on a modest single earner income. Just could have done better by not paying down the mortgage so aggressively and having a much larger taxable account.
vasaver
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Re: Am I crazy to get Tesla Model Y?

Post by vasaver »

Mongoose wrote: Mon Nov 02, 2020 11:21 am One thing I have never considered is leasing. Does this ever make sense?

What Tesla shows for the Y is $4500 down, 3 year lease, 10,000 miles annual (we historically don't drive more then this). $512/month.
That comes out to $23k for the lease. If I sold the Jeep I get about 18k which I could just use to pay the monthly amount/invest while holding.

I could then buy the next gen Y if we like it, or say no thank you and just get a conventional if it is horrible. The money I could "save" by not spending could just be thrown into a car account to grow for 3 years until we are ready to buy again?

I have never been a lease person but just trying to think things through logically.
So over 5 years you will spend 23k for the lease plus 24k in depreciation on the Model Y over 2 years and pay sales tax twice? So roughly 60k will magically disappear over 60 months?

Why not consider a 2-3 year old Chevy Bolt? It is an electric hatchback and costs 12k-15k. If you want to light money on fire be my guest.
Last edited by vasaver on Mon Nov 02, 2020 3:50 pm, edited 2 times in total.
Tingting1013
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Re: Am I crazy to get Tesla Model Y?

Post by Tingting1013 »

vasaver wrote: Mon Nov 02, 2020 3:47 pm
Mongoose wrote: Mon Nov 02, 2020 11:21 am One thing I have never considered is leasing. Does this ever make sense?

What Tesla shows for the Y is $4500 down, 3 year lease, 10,000 miles annual (we historically don't drive more then this). $512/month.
That comes out to $23k for the lease. If I sold the Jeep I get about 18k which I could just use to pay the monthly amount/invest while holding.

I could then buy the next gen Y if we like it, or say no thank you and just get a conventional if it is horrible. The money I could "save" by not spending could just be thrown into a car account to grow for 3 years until we are ready to buy again?

I have never been a lease person but just trying to think things through logically.
So over 4 years you could spend 23k for the lease plus 24k in depreciation on the Model Y and pay sales tax twice? So with sales tax about 60k will magically disappear over 48 months?

Why not consider a 2-3 year old Chevy Bolt? It is an electric hatchback and costs 12k-15k. If you want to light money on fire be my guest.
Lease payments represent depreciation + interest.

You are double counting depreciation.
vasaver
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Location: Virginia

Re: Am I crazy to get Tesla Model Y?

Post by vasaver »

Tingting1013 wrote: Mon Nov 02, 2020 3:48 pm
vasaver wrote: Mon Nov 02, 2020 3:47 pm
Mongoose wrote: Mon Nov 02, 2020 11:21 am One thing I have never considered is leasing. Does this ever make sense?

What Tesla shows for the Y is $4500 down, 3 year lease, 10,000 miles annual (we historically don't drive more then this). $512/month.
That comes out to $23k for the lease. If I sold the Jeep I get about 18k which I could just use to pay the monthly amount/invest while holding.

I could then buy the next gen Y if we like it, or say no thank you and just get a conventional if it is horrible. The money I could "save" by not spending could just be thrown into a car account to grow for 3 years until we are ready to buy again?

I have never been a lease person but just trying to think things through logically.
So over 4 years you could spend 23k for the lease plus 24k in depreciation on the Model Y and pay sales tax twice? So with sales tax about 60k will magically disappear over 48 months?

Why not consider a 2-3 year old Chevy Bolt? It is an electric hatchback and costs 12k-15k. If you want to light money on fire be my guest.
Lease payments represent depreciation + interest.

You are double counting depreciation.
He is doing 2 transactions, a lease and a purchase. Please forgive me - I assumed it was a 2 year lease (instead of 3). So he leases one for 3 years and buys another. So over 5 years...it will be about 60k.
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Mongoose
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Re: Am I crazy to get Tesla Model Y?

Post by Mongoose »

vasaver wrote: Mon Nov 02, 2020 3:53 pm
Tingting1013 wrote: Mon Nov 02, 2020 3:48 pm
vasaver wrote: Mon Nov 02, 2020 3:47 pm
Mongoose wrote: Mon Nov 02, 2020 11:21 am One thing I have never considered is leasing. Does this ever make sense?

What Tesla shows for the Y is $4500 down, 3 year lease, 10,000 miles annual (we historically don't drive more then this). $512/month.
That comes out to $23k for the lease. If I sold the Jeep I get about 18k which I could just use to pay the monthly amount/invest while holding.

I could then buy the next gen Y if we like it, or say no thank you and just get a conventional if it is horrible. The money I could "save" by not spending could just be thrown into a car account to grow for 3 years until we are ready to buy again?

I have never been a lease person but just trying to think things through logically.
So over 4 years you could spend 23k for the lease plus 24k in depreciation on the Model Y and pay sales tax twice? So with sales tax about 60k will magically disappear over 48 months?

Why not consider a 2-3 year old Chevy Bolt? It is an electric hatchback and costs 12k-15k. If you want to light money on fire be my guest.
Lease payments represent depreciation + interest.

You are double counting depreciation.
He is doing 2 transactions, a lease and a purchase. Please forgive me - I assumed it was a 2 year lease (instead of 3). So he leases one for 3 years and buys another. So over 5 years...it will be about 60k.
On top of the lease option normally being financially subpar- apparently Tesla does not give the option to purchase at the end of the lease. No thanks.

I might just take a step back and save as much as possible until April and then re-evaluate. The risk for me is being forced to repair the Jeep for about 5k. I could probably manage with a 10-15k loan at this point and possibly have some production kinks worked out.
avginvestor
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Re: Am I crazy to get Tesla Model Y?

Post by avginvestor »

We were looking at the Model 3 last year and decided on getting the Hyundai Kona EV which we actually love. Didn't really save much more money.. maybe like about $2-3k, but we liked the design more than the Tesla. The only thing I wish we had that the Tesla has is the supercharging network.

But before we bought an EV, we did an analysis if it made sense for us. In the end, my wife's commute of 33k miles per year and the 1/3rd cost of gas made it worthwhile to make the necessary charging infrastructure in our home.

That being said, if we only had access to 1 car, we wouldn't have considered an EV as our only vehicle.
Normchad
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Re: Am I crazy to get Tesla Model Y?

Post by Normchad »

avginvestor wrote: Mon Nov 02, 2020 6:45 pm We were looking at the Model 3 last year and decided on getting the Hyundai Kona EV which we actually love. Didn't really save much more money.. maybe like about $2-3k, but we liked the design more than the Tesla. The only thing I wish we had that the Tesla has is the supercharging network.

But before we bought an EV, we did an analysis if it made sense for us. In the end, my wife's commute of 33k miles per year and the 1/3rd cost of gas made it worthwhile to make the necessary charging infrastructure in our home.

That being said, if we only had access to 1 car, we wouldn't have considered an EV as our only vehicle.
I’ve had a model 3 for a year and half. What you say totally makes sense. I have a gas powered SUV just in case I want to drive 3000 miles one weekend. Mind you I have never done that, but still, I want to be able to.....

The longer I own the 3, the more I dread the thought of a long trip in my luxury SUV. At this point, it would honestly be a toss-up which one I would take on a very long trip.

Of course, if I need cargo room, I’m taking the SUV, but not looking forward to it.....
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