What should a 23 year old consider before purchasing a Tesla?

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radius9918
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by radius9918 »

I own a Tesla. My suggestion:Lease a tesla model 3 or Y. In 3 years there will be new technology. Unless you have a very long commute with a lot of highway driving you don’t need full self driving. I only use my FSD for my two hour each way, once a week drive to an alternate worksite.

unless you live in a warm climate you will need to spend $1k on snow tires when you buy. I’ve had four hybrids in my life and they all come with very crappy tires they give you better mileage but are absolutely terrible in the winter.

You also need to plan on spending about $1000 to install a charger in your home if you don’t already have one. I would not get a Tesla brand charger because, who knows if your next vehicle will be a Tesla and the Tesla comes with an adapter anyway.
smitcat
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by smitcat »

tibbitts wrote: Tue Dec 08, 2020 11:17 pm
smitcat wrote: Tue Dec 08, 2020 8:08 pm
tibbitts wrote: Tue Dec 08, 2020 4:10 pm
smitcat wrote: Tue Dec 08, 2020 3:10 pm
tibbitts wrote: Tue Dec 08, 2020 3:05 pm The main thing to consider is that for the foreseeable future in our pandemic world, he farthest it'll be practical to drive is the Walmart on the corner.
I had no idea that many folks were not driving - most all of us drive quite often.
I'm not sure about "most all." I've only filled my tank once in each car since March (and no, they're not plug-in hybrids.) Last year I'd fill one or the other every couple of weeks.
I guess some folks are doing almost no driving...
Although we are retired we sstill do some consulting mostly for free but we do get to see client lists from business's we know. Based on what we saw just last week at least one person of these types of clients was consitently drving: nurse, Dr, hosp clerical, hosp maintenance, police, court officer, firemen, mechanic, restaurant, phone company, water company, hardware store, food delivery, teacher, insurance, grocery store, gas station, electrician, landscaper, UPS, carpenter, water dept, USPS, Coast Guard, tin knocker, roofer, package store, pharmacy, etc..
I just paged in about 75 out of 500 clients.
Many of your examples involve commercial uses and vehicles; I was only referring to a personal vehicle.
"Many of your examples involve commercial uses and vehicles; I was only referring to a personal vehicle."
No - not at all , all of these clients drive to their place of work ....some quite a distance. If I had gone through the complete billing for a week the list would be much longer.
random_walker_77
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by random_walker_77 »

Consider this: you have a 100K job. Which means you're probably saving at best the equivalent of 25K/yr in after-tax dollars. That well-equipped Tesla is roughly 2 years worth of savings. That's a lot to sweat and labor for a (very cool) car.

Slightly hyperbolic, but take a look at Taylor's $4M car thread for a different point of view. I suspect you're going to buy that Tesla anyways.
viewtopic.php?f=10&t=276379

fwiw, the traditional time to do this is when you're 40. Higher income, more savings, and with a good handle on child rearing expenses, that's when most guys get their car (most often mockingly referred to as their "mid-life" crisis).

That said, I remember being a young engineer in silicon valley, making six figures alongside my friends (20 years ago, so the money went a little further than today). My friends all bought their dream cars -- high-powered Audi's. One got total'd a couple years later. The other went longer but got very expensively unreliable. Cars are expensive, but I think both enjoyed it very much. If you do it and go buy that expensive car, you're young and have time to recover. But financially, it's a really stupid move.
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Danimals543
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by Danimals543 »

Thanks guys. I decided against buying a Tesla.
unstartable
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by unstartable »

Tingting1013 wrote: Tue Dec 08, 2020 10:24 pm The following are likely true for a 23 year old who is making $100k:

1. They are likely at the beginning, not the end, of their salary progression.

2. A $50k car, purchased at any point for such a person, won’t make a material difference in their ultimate financial outcome.
Maybe? But what is a 23 y/o doing and making $100k that has any kind of job security?
Tingting1013
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by Tingting1013 »

unstartable wrote: Wed Dec 09, 2020 11:41 am
Tingting1013 wrote: Tue Dec 08, 2020 10:24 pm The following are likely true for a 23 year old who is making $100k:

1. They are likely at the beginning, not the end, of their salary progression.

2. A $50k car, purchased at any point for such a person, won’t make a material difference in their ultimate financial outcome.
Maybe? But what is a 23 y/o doing and making $100k that has any kind of job security?
My guess is software engineering or Wall Street.

Both of which build eminently transferable skills.
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Danimals543
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by Danimals543 »

Tingting1013 wrote: Wed Dec 09, 2020 11:46 am
unstartable wrote: Wed Dec 09, 2020 11:41 am
Tingting1013 wrote: Tue Dec 08, 2020 10:24 pm The following are likely true for a 23 year old who is making $100k:

1. They are likely at the beginning, not the end, of their salary progression.

2. A $50k car, purchased at any point for such a person, won’t make a material difference in their ultimate financial outcome.
Maybe? But what is a 23 y/o doing and making $100k that has any kind of job security?
My guess is software engineering or Wall Street.

Both of which build eminently transferable skills.
Software engineer (my degree is in electrical engineering)
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Tamarind
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by Tamarind »

Danimals543 wrote: Wed Dec 09, 2020 11:27 am Thanks guys. I decided against buying a Tesla.
Glad to hear it. My wife, who cares about cars much more than I do, really enjoys her Mazda3 touring. We got it new for $19,300 and paid cash. Feels like a luxury car to me and she says it's a good compromise between zip and good mileage. She still has to commute as she's an essential worker. <$20k cars have gotten so much better in the 10 years since I was 23. I don't see why I would pay more. I will let the folks who are already financially independent pay for Tesla R&D for now and save my money.

10 years ago I was not even where you are financially (made a lot less). Today we are approaching $500k saved for retirement. The way you do that is to save hard early and don't develop champagne tastes till you can afford them.
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Elsebet
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by Elsebet »

Danimals543 wrote: Wed Dec 09, 2020 11:27 am Thanks guys. I decided against buying a Tesla.
I think this is wise. I know it can be tough to listen to a bunch of older people at your age. I know I initially resisted when an older colleague nagged me about maxing my 401k at your age, but at 44 I'm glad I listened to him and did it 21 years ago. I think of him every time I look at my portfolio.

I'm not sure where you are commuting in Washington but I lived there from 2013-2020 and the traffic was awful. No car would help me enjoy Seattle traffic unless it was 100% automated to the point I could do something else while the car drove me. I limited my driving there to the point I became a bit introverted. Now I live in PA with much less traffic and we are considering a Tesla (or another electric car) once it's time to sell the 2006 Honda Civic because it's much more enjoyable to drive here and we do so more often.
"...the man who adapts himself to his slender means and makes himself wealthy on a little sum, is the truly rich man..." ~Seneca
tibbitts
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by tibbitts »

smitcat wrote: Wed Dec 09, 2020 8:43 am
tibbitts wrote: Tue Dec 08, 2020 11:17 pm
smitcat wrote: Tue Dec 08, 2020 8:08 pm
tibbitts wrote: Tue Dec 08, 2020 4:10 pm
smitcat wrote: Tue Dec 08, 2020 3:10 pm

I had no idea that many folks were not driving - most all of us drive quite often.
I'm not sure about "most all." I've only filled my tank once in each car since March (and no, they're not plug-in hybrids.) Last year I'd fill one or the other every couple of weeks.
I guess some folks are doing almost no driving...
Although we are retired we sstill do some consulting mostly for free but we do get to see client lists from business's we know. Based on what we saw just last week at least one person of these types of clients was consitently drving: nurse, Dr, hosp clerical, hosp maintenance, police, court officer, firemen, mechanic, restaurant, phone company, water company, hardware store, food delivery, teacher, insurance, grocery store, gas station, electrician, landscaper, UPS, carpenter, water dept, USPS, Coast Guard, tin knocker, roofer, package store, pharmacy, etc..
I just paged in about 75 out of 500 clients.
Many of your examples involve commercial uses and vehicles; I was only referring to a personal vehicle.
"Many of your examples involve commercial uses and vehicles; I was only referring to a personal vehicle."
No - not at all , all of these clients drive to their place of work ....some quite a distance. If I had gone through the complete billing for a week the list would be much longer.
Here is a discussion: https://www.carinsurance.org/coronavirus-and-driving/
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Danimals543
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by Danimals543 »

Elsebet wrote: Wed Dec 09, 2020 12:11 pm
Danimals543 wrote: Wed Dec 09, 2020 11:27 am Thanks guys. I decided against buying a Tesla.
I think this is wise. I know it can be tough to listen to a bunch of older people at your age. I know I initially resisted when an older colleague nagged me about maxing my 401k at your age, but at 44 I'm glad I listened to him and did it 21 years ago. I think of him every time I look at my portfolio.

I'm not sure where you are commuting in Washington but I lived there from 2013-2020 and the traffic was awful. No car would help me enjoy Seattle traffic unless it was 100% automated to the point I could do something else while the car drove me. I limited my driving there to the point I became a bit introverted. Now I live in PA with much less traffic and we are considering a Tesla (or another electric car) once it's time to sell the 2006 Honda Civic because it's much more enjoyable to drive here and we do so more often.
Now it’s just a debate of getting like a $20k car that I could afford, or not doing that and putting that $20k elsewhere like some of it into S&P fund. Or maybe doing a loan so that I can invest the rest. But then again, I don’t need a car right now. But it’s a whole lot better than spending $50k where I originally started LOL
bagle
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by bagle »

Danimals543 wrote: Wed Dec 09, 2020 11:27 am Thanks guys. I decided against buying a Tesla.
Wise choice. Otherwise, you might get distracted from work with all those heated online discussions as to whether Tesla is close to achieving Level 5 full self-driving or not :.)
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Danimals543
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by Danimals543 »

bagle wrote: Wed Dec 09, 2020 12:21 pm
Danimals543 wrote: Wed Dec 09, 2020 11:27 am Thanks guys. I decided against buying a Tesla.
Wise choice. Otherwise, you might get distracted from work with all those heated online discussions as to whether Tesla is close to achieving Level 5 full self-driving or not :.)
Haha yup! :) now I’m looking at a VW GTI (the 2015+ models have good reliability and it’s a fun car for waaaay cheaper at $20k).
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Orbuculum Nongata
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by Orbuculum Nongata »

Danimals543 wrote: Wed Dec 09, 2020 12:45 pm
bagle wrote: Wed Dec 09, 2020 12:21 pm
Danimals543 wrote: Wed Dec 09, 2020 11:27 am Thanks guys. I decided against buying a Tesla.
Wise choice. Otherwise, you might get distracted from work with all those heated online discussions as to whether Tesla is close to achieving Level 5 full self-driving or not :.)
Haha yup! :) now I’m looking at a VW GTI (the 2015+ models have good reliability and it’s a fun car for waaaay cheaper at $20k).
I've got a 2019 base GTI with manual transmission. Lots of fun for the money. Get one!
Potential - distraction = performance.
tibbitts
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by tibbitts »

chipperd wrote: Wed Dec 09, 2020 2:40 am
tibbitts wrote: Tue Dec 08, 2020 4:19 pm
chipperd wrote: Tue Dec 08, 2020 3:58 pm
tibbitts wrote: Tue Dec 08, 2020 3:09 pm
chipperd wrote: Tue Dec 08, 2020 10:31 am A house, for most of the history of private property ownership, appreciates in value.
I don't believe houses have ever appreciated. The property a house is on may appreciate, or not. The wood, concrete, paint, shingles... all that stuff starts deteriorating the minute a new house is completed.
I disagree on that point. . Condos, for example, appreciate all the time and most condos I've seen are built on land owned by someone other than the condo owner. While I agree that property with a nice, livable structure would probably appreciate at a faster rate in most locations, condos are also known to appreciate a majority of the time.
Since one of my residences is a condo, I would say that the appreciation reflects the share of the location/property that the condo represents. It's the supply/demand for the location that matters, entirely because there are a finite number of housing units available in the location. The contents of the condo (everything from the walls to the fixtures) depreciate the same as the ones in my house. You can say that there can some temporary of the structure itself, for example now - a house built before this year's dramatic rise in some other raw material prices could have appreciated atypically, but eventually the materials the home was built with will deteriorate and need replacement.
Ok. You can have the last word on that issue. I will concede wood and all other materials, taken as they are only on face value, depreciate. I'm not going to continue the back and forth on the minutia of the depreciation rate home building materials sitting outside in a pile vs a vehicle.
Condos people purchase and live in, as well as homes that people purchase and live in, for whatever reason, do appreciate a vast majority of the time. https://www.economy.com/united-states/house-price-index
My point to the OP was that comparing cars, which do depreciate to condos or homes (and the previously assumed obvious property they are built on) generally appreciate a vast majority of the time, isn't a straight line comparison and, to use a metaphor, is like comparing apples to oranges.
I'll be more specific next time.
I stole my response from Investopedia:
...in reality, a property's physical structure tends to depreciate over time, while the land it sits on typically appreciates in value.
chipperd
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by chipperd »

tibbitts wrote: Wed Dec 09, 2020 1:03 pm
chipperd wrote: Wed Dec 09, 2020 2:40 am
tibbitts wrote: Tue Dec 08, 2020 4:19 pm
chipperd wrote: Tue Dec 08, 2020 3:58 pm
tibbitts wrote: Tue Dec 08, 2020 3:09 pm
I don't believe houses have ever appreciated. The property a house is on may appreciate, or not. The wood, concrete, paint, shingles... all that stuff starts deteriorating the minute a new house is completed.
I disagree on that point. . Condos, for example, appreciate all the time and most condos I've seen are built on land owned by someone other than the condo owner. While I agree that property with a nice, livable structure would probably appreciate at a faster rate in most locations, condos are also known to appreciate a majority of the time.
Since one of my residences is a condo, I would say that the appreciation reflects the share of the location/property that the condo represents. It's the supply/demand for the location that matters, entirely because there are a finite number of housing units available in the location. The contents of the condo (everything from the walls to the fixtures) depreciate the same as the ones in my house. You can say that there can some temporary of the structure itself, for example now - a house built before this year's dramatic rise in some other raw material prices could have appreciated atypically, but eventually the materials the home was built with will deteriorate and need replacement.
Ok. You can have the last word on that issue. I will concede wood and all other materials, taken as they are only on face value, depreciate. I'm not going to continue the back and forth on the minutia of the depreciation rate home building materials sitting outside in a pile vs a vehicle.
Condos people purchase and live in, as well as homes that people purchase and live in, for whatever reason, do appreciate a vast majority of the time. https://www.economy.com/united-states/house-price-index
My point to the OP was that comparing cars, which do depreciate to condos or homes (and the previously assumed obvious property they are built on) generally appreciate a vast majority of the time, isn't a straight line comparison and, to use a metaphor, is like comparing apples to oranges.
I'll be more specific next time.
I stole my response from Investopedia:
...in reality, a property's physical structure tends to depreciate over time, while the land it sits on typically appreciates in value.
Ok, well in that case, guess your taking a bath on your condo.
Best of luck.
"A portfolio is like a bar of soap, the more it's handled, the less there is." Dr. William Bernstein
smitcat
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by smitcat »

tibbitts wrote: Wed Dec 09, 2020 12:15 pm
smitcat wrote: Wed Dec 09, 2020 8:43 am
tibbitts wrote: Tue Dec 08, 2020 11:17 pm
smitcat wrote: Tue Dec 08, 2020 8:08 pm
tibbitts wrote: Tue Dec 08, 2020 4:10 pm
I'm not sure about "most all." I've only filled my tank once in each car since March (and no, they're not plug-in hybrids.) Last year I'd fill one or the other every couple of weeks.
I guess some folks are doing almost no driving...
Although we are retired we sstill do some consulting mostly for free but we do get to see client lists from business's we know. Based on what we saw just last week at least one person of these types of clients was consitently drving: nurse, Dr, hosp clerical, hosp maintenance, police, court officer, firemen, mechanic, restaurant, phone company, water company, hardware store, food delivery, teacher, insurance, grocery store, gas station, electrician, landscaper, UPS, carpenter, water dept, USPS, Coast Guard, tin knocker, roofer, package store, pharmacy, etc..
I just paged in about 75 out of 500 clients.
Many of your examples involve commercial uses and vehicles; I was only referring to a personal vehicle.
"Many of your examples involve commercial uses and vehicles; I was only referring to a personal vehicle."
No - not at all , all of these clients drive to their place of work ....some quite a distance. If I had gone through the complete billing for a week the list would be much longer.
Here is a discussion: https://www.carinsurance.org/coronavirus-and-driving/
Great data - its not affecting the people we know nearly that much - thankfully.
azanon
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by azanon »

Danimals543 wrote: Tue Dec 08, 2020 2:00 am
HomerJ wrote: Tue Dec 08, 2020 1:52 am Don't get a luxury car until you can pay cash for it.
Cash doesn’t max sense with a 2.5% loan. Would rather take out a loan and invest the cash.
It's a mistake to compare an essentially risk free rate (e.g the bank will own the car until it's paid in full so they have collateral), with a risky rate such as the stock market. A comparable rate is probably more in the neighborhood of high-yield savings rates - so about 0.6%. In short, that's a really bad deal.

Rounding off, the only good deals right now concerning financing, are essentially 0% interest ones, and even that isn't anything to get too excited about, for the reason previously mentioned.
H-Town
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by H-Town »

Danimals543 wrote: Wed Dec 09, 2020 12:20 pm
Elsebet wrote: Wed Dec 09, 2020 12:11 pm
Danimals543 wrote: Wed Dec 09, 2020 11:27 am Thanks guys. I decided against buying a Tesla.
I think this is wise. I know it can be tough to listen to a bunch of older people at your age. I know I initially resisted when an older colleague nagged me about maxing my 401k at your age, but at 44 I'm glad I listened to him and did it 21 years ago. I think of him every time I look at my portfolio.

I'm not sure where you are commuting in Washington but I lived there from 2013-2020 and the traffic was awful. No car would help me enjoy Seattle traffic unless it was 100% automated to the point I could do something else while the car drove me. I limited my driving there to the point I became a bit introverted. Now I live in PA with much less traffic and we are considering a Tesla (or another electric car) once it's time to sell the 2006 Honda Civic because it's much more enjoyable to drive here and we do so more often.
Now it’s just a debate of getting like a $20k car that I could afford, or not doing that and putting that $20k elsewhere like some of it into S&P fund. Or maybe doing a loan so that I can invest the rest. But then again, I don’t need a car right now. But it’s a whole lot better than spending $50k where I originally started LOL
That's a step into the right direction.

Your car is still at 130k miles. Unless it has any major breakdown, you still can keep it until 200k miles or so. You can always rent a car for the weekend for fun. It's a lot cheaper than $50k cash outlay.

My Camaro is at 150k miles. I already set aside $30k a couple of years ago to buy a car if needed, but time flies and my car keeps running. So I can defer the purchase while the fund keeps growing.
smitcat
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by smitcat »

tibbitts wrote: Wed Dec 09, 2020 1:03 pm
chipperd wrote: Wed Dec 09, 2020 2:40 am
tibbitts wrote: Tue Dec 08, 2020 4:19 pm
chipperd wrote: Tue Dec 08, 2020 3:58 pm
tibbitts wrote: Tue Dec 08, 2020 3:09 pm
I don't believe houses have ever appreciated. The property a house is on may appreciate, or not. The wood, concrete, paint, shingles... all that stuff starts deteriorating the minute a new house is completed.
I disagree on that point. . Condos, for example, appreciate all the time and most condos I've seen are built on land owned by someone other than the condo owner. While I agree that property with a nice, livable structure would probably appreciate at a faster rate in most locations, condos are also known to appreciate a majority of the time.
Since one of my residences is a condo, I would say that the appreciation reflects the share of the location/property that the condo represents. It's the supply/demand for the location that matters, entirely because there are a finite number of housing units available in the location. The contents of the condo (everything from the walls to the fixtures) depreciate the same as the ones in my house. You can say that there can some temporary of the structure itself, for example now - a house built before this year's dramatic rise in some other raw material prices could have appreciated atypically, but eventually the materials the home was built with will deteriorate and need replacement.
Ok. You can have the last word on that issue. I will concede wood and all other materials, taken as they are only on face value, depreciate. I'm not going to continue the back and forth on the minutia of the depreciation rate home building materials sitting outside in a pile vs a vehicle.
Condos people purchase and live in, as well as homes that people purchase and live in, for whatever reason, do appreciate a vast majority of the time. https://www.economy.com/united-states/house-price-index
My point to the OP was that comparing cars, which do depreciate to condos or homes (and the previously assumed obvious property they are built on) generally appreciate a vast majority of the time, isn't a straight line comparison and, to use a metaphor, is like comparing apples to oranges.
I'll be more specific next time.
I stole my response from Investopedia:
...in reality, a property's physical structure tends to depreciate over time, while the land it sits on typically appreciates in value.
I dont really know how much of the appreciation has come from the home or the property but I can say for sure that the value of both has gone up in our experience.
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cchrissyy
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by cchrissyy »

Danimals543 wrote: Wed Dec 09, 2020 2:28 am Yeah, insurance would be around $200-$250 a month based on the insurance quotes I got.
that's a lot!

what is your current monthly insurance for the sentra?
what is the quote if you got a new car but not a tesla, such as the GTI?
hightower
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by hightower »

I'm going to add my 2 cents to this discussion too just because. If you don't have enough cash on hand to pay for this car in full with cash, you can not afford this car. Now, I'm not necessarily opposed to taking out a car loan if the terms are good...BUT you should have the option of paying cash meaning cash in hand now. If you don't, you can't afford a 50k luxury car. I make over 300k a year and a 60k Tesla is a big deal to me. I have enough cash at my disposal to buy a couple of Tesla's with cash if I wanted to. That's the type of person who should be buying a 50k car. Not a 23 year old making a modest salary with no savings. 100k/yr is commendable, but you won't be able to build real wealth if you get used to spending half a years salary on a car and taking out debt to do it.
hightower
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by hightower »

Danimals543 wrote: Tue Dec 08, 2020 1:50 am
LFKB wrote: Tue Dec 08, 2020 1:46 am It’s your money - do what you want with it. Not one anyone else wants you to do. Just ensure you understand your options and alternatives.

For example:

Option 1 - spend $50k on the Tesla over 5 years

Option 2 - spend $25k for a cheaper car over next 5 years and invest the other $25k, which growing at 8% over the next 30 years becomes $250k
I would spend $25k if a cheaper Tesla was available. I don’t want to spend $25k on a gas car and have it outdated since the world is moving towards electricity.
You can get a brand new Chevy Bolt for 28k now. Or a used Nissan leaf can be found for great deals too. Also, a used BMW i3 can be had for 12-14k. They are excellent cars, well made with none of the quality issues that Tesla is famous for. Save up cash and buy one of those if you want an electric car.
golfer292
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by golfer292 »

"What should a 23 year old consider before purchasing a Tesla?"

The same things I as a 72 year old should consider. My answer ,,,,, everything and especially wants and needs. I want a new sports car. I want a newer and larger house. There are many things I want. But if i made a list of wants and needs and made decisions from that list i will not get either.
hightower
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by hightower »

Danimals543 wrote: Tue Dec 08, 2020 2:49 am
abonder wrote: Tue Dec 08, 2020 2:47 am If you want to go battery electric but save a ton of money, check out off-lease 2017 Chevy bolts. Definitely not the Tesla aesthetic but they can be had for impressively little money for a car with a 200 plus mile range and a good overall reputation.
Other electric manufacturers have slow cars. Chevy Bolt's 0-60 is 6.5 seconds, while the model 3 I'm looking at is 4.2. Plus no self-driving. I would rather just get a gas car at that point for the performance rather than get a crappy EV.
Look, I get it, Tesla's are fast and that's why a lot of people like them. Other EV's are not "slow" though. They are still faster than most typical ICE cars even at 0-60 in 6 seconds. If you don't believe me, go test drive one and floor it at every intersection. They are still fun.

Anyway, you need to decide what's important to you. Having a fast sports car at age 23 or getting ahead of the pack with your savings. I can promise you that if you start spending this kind of dough on cars at your age now, you'll develop a habit of always "needing" the latest, greatest, fast, expensive car for the rest of your life and it absolutely will impact your savings dramatically. 5 years from now Model 3's will probably be 10k cheaper and have 60% more range than they do now and they'll probably be faster too. You'll still be making payments on your out-dated model 3 at that point. Then, you'll convince yourself that you have to trade it in and buy another one and sign up for another 6 year loan. It's a cycle that will continue to repeat itself for the rest of your life. You'll always be in debt to banks for the car that you drive.

Take it from me, if I were 23 and had the opportunity to save like you do, I'd absolutely skip the over priced sports car and drive a used/much cheaper EV for while. The beauty of compound interest isn't fully appreciated unless you start young. You're young and have time on your side. Pour as much into savings and investments as possible now and you will be very thankful to yourself in the future. You'll be able to buy a super fast Tesla some day and pay cash for it if you learn to be disciplined now.
hightower
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by hightower »

Sourc3 wrote: Tue Dec 08, 2020 4:06 am Of course you should get it. Every 23 year old needs to be able to look back in 10 years and say ‘that was stupid’. This could be your opportunity.

I’ve done my share of rightly justified but stupid financial decisions at your age like getting a bmw.
Lol, best post. Absolutely true though. I did plenty of dumb things at that age too. I think that's why this thread is getting so many responses. Because we all see an opportunity to help prevent another 20 something from making a stupid financial decision. Not just that, but at that age he has an opportunity to be a super star and take advantage of compounding interest from a very young age. By time he's my age (38), he could be in the 2 comma club already.
random_walker_77
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by random_walker_77 »

Danimals543 wrote: Wed Dec 09, 2020 12:45 pm
bagle wrote: Wed Dec 09, 2020 12:21 pm
Danimals543 wrote: Wed Dec 09, 2020 11:27 am Thanks guys. I decided against buying a Tesla.
Wise choice. Otherwise, you might get distracted from work with all those heated online discussions as to whether Tesla is close to achieving Level 5 full self-driving or not :.)
Haha yup! :) now I’m looking at a VW GTI (the 2015+ models have good reliability and it’s a fun car for waaaay cheaper at $20k).
Congrats. Your future self will thank you. Will your Sentra keep you chugging along for a couple more years? Your best bet is probably to nurse it along for a couple years, then get a used car. Instead of a GTI, have you considered the BMW i3?

Here's a gently used 2014 w/ only 22K miles on it, and includes the range extender. Asking price: $12,998 Seems like a typical price at a dealer, so with some care, you could probably get a better deal. But if you can wait 3 years, then maybe you're looking at a 2017/2018 (w/ greater electric-only range) at that price.

car and driver review of the 2014 i3: https://www.caranddriver.com/reviews/a1 ... st-review/
neb2020
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by neb2020 »

Has anyone considered the intangible downsides for owning a Tesla?

I feel that (opinion, unfortunately no studies to back this up), than owing a Tesla simply paints a target on your back. That you're rich, loaded and "come rob me". I would feel unsafe owning a Tesla because of this.
vasaver
Posts: 216
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Location: Virginia

Re: What should a 23 year old consider before purchasing a Tesla?

Post by vasaver »

hightower wrote: Wed Dec 09, 2020 2:34 pm
Danimals543 wrote: Tue Dec 08, 2020 1:50 am
LFKB wrote: Tue Dec 08, 2020 1:46 am It’s your money - do what you want with it. Not one anyone else wants you to do. Just ensure you understand your options and alternatives.

For example:

Option 1 - spend $50k on the Tesla over 5 years

Option 2 - spend $25k for a cheaper car over next 5 years and invest the other $25k, which growing at 8% over the next 30 years becomes $250k
I would spend $25k if a cheaper Tesla was available. I don’t want to spend $25k on a gas car and have it outdated since the world is moving towards electricity.
You can get a brand new Chevy Bolt for 28k now. Or a used Nissan leaf can be found for great deals too. Also, a used BMW i3 can be had for 12-14k. They are excellent cars, well made with none of the quality issues that Tesla is famous for. Save up cash and buy one of those if you want an electric car.
Used 2017 Chevy Bolts are 13k for the LT or go crazy with the 16k Premier (with fancy pants leather and all the options).

https://www.autotrader.com/cars-for-sal ... Records=25

See if you like electric and upgrade to a Tesla later if it meets your needs. Hatchbacks like the Bolt are much more practical than sedans like the Model 3.

As an added bonus being in the PNW - that is a great climate for having a Battery Electric Vehicle.
hightower
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by hightower »

vasaver wrote: Wed Dec 09, 2020 5:10 pm
hightower wrote: Wed Dec 09, 2020 2:34 pm
Danimals543 wrote: Tue Dec 08, 2020 1:50 am
LFKB wrote: Tue Dec 08, 2020 1:46 am It’s your money - do what you want with it. Not one anyone else wants you to do. Just ensure you understand your options and alternatives.

For example:

Option 1 - spend $50k on the Tesla over 5 years

Option 2 - spend $25k for a cheaper car over next 5 years and invest the other $25k, which growing at 8% over the next 30 years becomes $250k
I would spend $25k if a cheaper Tesla was available. I don’t want to spend $25k on a gas car and have it outdated since the world is moving towards electricity.
You can get a brand new Chevy Bolt for 28k now. Or a used Nissan leaf can be found for great deals too. Also, a used BMW i3 can be had for 12-14k. They are excellent cars, well made with none of the quality issues that Tesla is famous for. Save up cash and buy one of those if you want an electric car.
Used 2017 Chevy Bolts are 13k LT or go crazy with the 16k Premier (with fancy pants leather and all the options).

https://www.autotrader.com/cars-for-sal ... Records=25

See if you like electric and upgrade to a Tesla later if it meets your needs. Hatchbacks like the Bolt are much more practical than sedans like the Model 3.

As an added bonus being in the PNW - that is a great climate for having a Battery Electric Vehicle.
Agreed. I have been driving a BMW i3 for several years now. Fantastic car and fun to drive. We are upgrading to a Model Y though, because we have a 2 year old now and need a bigger vehicle. Paid cash for it and got the 7500 tax credit, but it's now only worth about 12k, which is a huge hit. If I were in the market for an i3 now, I'd be all over the used ones. They are great cars and an absolute steal for the money. Mine has 52k miles and no battery degradation or other problems to speak of. They are 100% luxury vehicles just like their ICE BMW counterparts. Auto dimming mirrors, heated seats, premium sound system, and it can parallel park itself!
EddyB
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by EddyB »

azanon wrote: Wed Dec 09, 2020 2:00 pm It's a mistake to compare an essentially risk free rate (e.g the bank will own the car until it's paid in full so they have collateral), with a risky rate such as the stock market. A comparable rate is probably more in the neighborhood of high-yield savings rates - so about 0.6%. In short, that's a really bad deal.
It’s a mistake to treat a preference as a presumption of comparability or equivalence.
hightower
Posts: 863
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by hightower »

neb2020 wrote: Wed Dec 09, 2020 5:00 pm Has anyone considered the intangible downsides for owning a Tesla?

I feel that (opinion, unfortunately no studies to back this up), than owing a Tesla simply paints a target on your back. That you're rich, loaded and "come rob me". I would feel unsafe owning a Tesla because of this.
You should check out the Youtube channel "Wham Bam Teslacam" Lot's of video footage recorded by Tesla's cars sentry mode. Road rage incidents, vandalism, break in's. It's entertaining to say the least.
mervinj7
Posts: 1683
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by mervinj7 »

Danimals543 wrote: Wed Dec 09, 2020 12:45 pm
bagle wrote: Wed Dec 09, 2020 12:21 pm
Danimals543 wrote: Wed Dec 09, 2020 11:27 am Thanks guys. I decided against buying a Tesla.
Wise choice. Otherwise, you might get distracted from work with all those heated online discussions as to whether Tesla is close to achieving Level 5 full self-driving or not :.)
Haha yup! :) now I’m looking at a VW GTI (the 2015+ models have good reliability and it’s a fun car for waaaay cheaper at $20k).
Have you considered a Nissan Leaf? I'm older than you and make roughly double but I still only spent ~$16k+tax on my new 2020 EV.
viewtopic.php?p=5585191#p5585191
dmk395
Posts: 101
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by dmk395 »

Buy a house!!
angelescrest
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Location: MCOL, no state income tax

Re: What should a 23 year old consider before purchasing a Tesla?

Post by angelescrest »

hightower wrote: Wed Dec 09, 2020 5:29 pm
vasaver wrote: Wed Dec 09, 2020 5:10 pm
hightower wrote: Wed Dec 09, 2020 2:34 pm
Danimals543 wrote: Tue Dec 08, 2020 1:50 am
LFKB wrote: Tue Dec 08, 2020 1:46 am It’s your money - do what you want with it. Not one anyone else wants you to do. Just ensure you understand your options and alternatives.

For example:

Option 1 - spend $50k on the Tesla over 5 years

Option 2 - spend $25k for a cheaper car over next 5 years and invest the other $25k, which growing at 8% over the next 30 years becomes $250k
I would spend $25k if a cheaper Tesla was available. I don’t want to spend $25k on a gas car and have it outdated since the world is moving towards electricity.
You can get a brand new Chevy Bolt for 28k now. Or a used Nissan leaf can be found for great deals too. Also, a used BMW i3 can be had for 12-14k. They are excellent cars, well made with none of the quality issues that Tesla is famous for. Save up cash and buy one of those if you want an electric car.
Used 2017 Chevy Bolts are 13k LT or go crazy with the 16k Premier (with fancy pants leather and all the options).

https://www.autotrader.com/cars-for-sal ... Records=25

See if you like electric and upgrade to a Tesla later if it meets your needs. Hatchbacks like the Bolt are much more practical than sedans like the Model 3.

As an added bonus being in the PNW - that is a great climate for having a Battery Electric Vehicle.
Agreed. I have been driving a BMW i3 for several years now. Fantastic car and fun to drive. We are upgrading to a Model Y though, because we have a 2 year old now and need a bigger vehicle. Paid cash for it and got the 7500 tax credit, but it's now only worth about 12k, which is a huge hit. If I were in the market for an i3 now, I'd be all over the used ones. They are great cars and an absolute steal for the money. Mine has 52k miles and no battery degradation or other problems to speak of. They are 100% luxury vehicles just like their ICE BMW counterparts. Auto dimming mirrors, heated seats, premium sound system, and it can parallel park itself!
Almost went with a used i3. Then I read about some extremely pricey repairs that could be upwards of $10k. Scared me off big time. What year and trim used i3 would you recommend for around 10-12k?
Jack FFR1846
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by Jack FFR1846 »

Danimals543 wrote: Tue Dec 08, 2020 1:49 pm No I primarily just want a sporty, fun car. But the fact that Tesla is electric AND sporty is nice. The other electric offerings are tame in comparison.
Buy a used Lotus Elise. It's not electric or as fast as a Tesla, but is way more fun and everyone likes them. Be ready for all the girls to smile at you (your car) and to get home and find videos of your trip every time you go out. Oh, and they're less than a Camry and have Toyota drivetrains in them. Expect them to go UP in value if you keep it in good condition.

When you open the dictionary to "fun car" a Lotus Elise picture is there.
Bogle: Smart Beta is stupid
flyingaway
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by flyingaway »

I just read the first few comments and the OP's replies.

Is this a good example of "keeping up with the Joneses"?
Gabelli2020
Posts: 58
Joined: Sat Nov 14, 2020 4:01 pm

Re: What should a 23 year old consider before purchasing a Tesla?

Post by Gabelli2020 »

I bought a Tesla Model S 100D a little over 2 years ago. The cash price was $107,000 ( but I got $7500 back as tax credit). My range is 335 miles. I have had it in for 2 minor repairs- door handle issue and a/c not cold enough. You can get that same Model S for $64,000 now, with a 400 mile range. Every time I get into that car I smile. EVERY Tesla owner immediately ascends to a higher Karma level. It’s not a car.
rickcrna
Posts: 7
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by rickcrna »

OP

If you want to drive a Tesla...go buy a Tesla. You're going to get a lot of "practical" advice here from a generally wise and pragmatic Bogelhead crowd. And sometimes there is a fair amount of anti-Tesla sentiment sprinkled in both from an ownership and investment standpoint. You opened your thread with a question pertaining to purchasing a Tesla. You can weigh all of the 5 pages of options and opinions and ultimately you get to decide. There are no absolute right or wrong answers just a bunch of thoughtful justifications to a point of view.

BTW...my wife and I are recently retired and looking to consolidate our vehicles to 2....one 2013 Toyota Tacoma and we're waiting to take delivery of a 2021 Tesla Model Y later this month. This is our first EV and are pretty excited to take the plunge after doing ALOT of self-education about these vehicles.

Now...you get to decide what works best for you.

Rick
JBTX
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by JBTX »

Danimals543 wrote: Wed Dec 09, 2020 11:27 am Thanks guys. I decided against buying a Tesla.
You may want to edit the thread title and OP to reflect that, otherwise you may be getting advice for weeks.

My first thought when I read the OP was "yeah, that's a dumb idea". But as I thought about it, decades ago, I was a few years older than you, I made a little less but close on a inflation adjusted basis, and bought my first car, and the price was almost 50% of my salary. I maxed 401k and IRA, shared rent with a roommate, and had little other expenses other than entertainment. Now the car was just a higher end sport model Nissan Maxima- which shows in real dollars you can get much more car now. But I did keep it 10 years and put over 150k miles on it.

You made the right decision not doing it, but it isn't out of the ordinary if you had, nor expected to have other obligations in the near future.
RonSwanson
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by RonSwanson »

If you are thinking far enough into the future, owning a car at all will seem outdated :)
2tall4economy
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Location: Global

Re: What should a 23 year old consider before purchasing a Tesla?

Post by 2tall4economy »

You couldn’t pay me to own a Tesla. In fact I’ve lately been starting “collection” of sorts of inexpensive manual ice vehicles to bask in the nostalgia before they’re gone for good.

That said, if you want to wait for a cheaper Tesla, you need border adoption and critical Mass of production.

Gm will do that well before tesla. That’s my bet anyway.
You can do anything you want in life. The rub is that there are consequences.
lucky_tech_guy
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by lucky_tech_guy »

5.7L of fury, or 6+ in the new vettes. And it sounds good.

Buy it. I bought my Z06 when I was 25. Damn fun car. It's pretty much a track car now though. No regrets, even when I lived in the city and barely got to drive it


Danimals543 wrote: Tue Dec 08, 2020 11:14 pm
EddyB wrote: Tue Dec 08, 2020 10:09 pm
Danimals543 wrote: Tue Dec 08, 2020 5:47 pm
crystalbank wrote: Tue Dec 08, 2020 5:39 pm Ask yourself - Why are you buying it? Are you really into cars and enjoy driving or do you feeling like buying something nice for yourself? If it's the latter, skip it.
The former
Then why buy a Tesla? I get that they’re great transit, but they’re not really top of the list for “I enjoy driving,” are they?
You ever experience instant torque? It’s like having a personal rollercoaster.
2tall4economy
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by 2tall4economy »

Gabelli2020 wrote: EVERY Tesla owner immediately ascends to a higher Karma level. It’s not a car.
Unless you installed solar panels sufficient to charge the battery of that car you’re just trading one source of pollution for a different one. No karma to be had.
You can do anything you want in life. The rub is that there are consequences.
Saving$
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by Saving$ »

What should a 23 year old consider before purchasing a Tesla?
Danimals543 wrote: Tue Dec 08, 2020 2:54 am ....You're right, I only have $25,000 on top of my $15,000 emergency fund.
The above is what you should consider.
Don't finance a depreciating asset. If you can't pay cash you can't afford it. Only exception is a house.

You should consider
1. Max 401k
2. Max HSA
3. Max Roth
4. Emergency fund = 6 month living expenses
5. Start funding taxable investment account if you want to achieve FI.
- You won't get there, or at least get there as quickly, with only 401k/Roth.
- You won't get there as quickly or at all if you continue thinking spending $50k on a financed vehicle that you apparently only plan to keep for 3 years is reasonable.

Read the book the millionaire next door. You will learn that most of them are perfectly happy to drive 10-15 year old Fords, that they bought with cash.

Q: What should a 23 year old consider before purchasing a Tesla?
A: Priorities
TIAX
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by TIAX »

Danimals543 wrote: Tue Dec 08, 2020 2:34 am
kiwi123 wrote: Tue Dec 08, 2020 2:18 am 'Boglehead advice' will be a 23-yr old making $100k is too soon to be buying a $50k eclectic vehicle (that will be outdated in 3 years as EV tech is progressing rapidly). "Wisdom" on this forum would be to get a cheaper new or used vehicle for <$30k which has the same utility as the Tesla (although not the same 'cool' or 'fun' factor) e.g. your usual suspects of toyota, hyundai, honda, etc. etc. You'll also have an extra financial cushion if you lose your job in 6 months.

In the non-boglehead world you can certainly get it if you want it... it will just delay financial independence by 2-3 years and potentially set you on a path of living beyond your means as you'll probably want to upgrade to the newest tesla in 4 years because you just got a fat raise to $150k :-)

(Anyway, you already know the answers you'll get on this forum for that kind of question)
How can it delay financial independence? I’m already maxing out my 401k and Roth IRA. Most Americans barely contribute anything to retirement.
What's the difference what most Americans do? The point is the more you invest, the sooner you will become financially independent.
bltn
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by bltn »

Danimals543 wrote: Tue Dec 08, 2020 1:50 am
LFKB wrote: Tue Dec 08, 2020 1:46 am It’s your money - do what you want with it. Not one anyone else wants you to do. Just ensure you understand your options and alternatives.

For example:

Option 1 - spend $50k on the Tesla over 5 years

Option 2 - spend $25k for a cheaper car over next 5 years and invest the other $25k, which growing at 8% over the next 30 years becomes $250k
I would spend $25k if a cheaper Tesla was available. I don’t want to spend $25k on a gas car and have it outdated since the world is moving towards electricity.
Consider that a new 50,000 dollar car is worth 40,000 2 months after you drive away from the dealership. And a year later 30,000.

At your level accumulation, a 50,000 dollar car is way more than I would spend on a depreciating asset. And I m a car person. As is my wife. We ve looked Tesla s with interest but the relatively few charging stations make us a bit uncomfortable with a Tesla purchase.

At your stage of wealth development, I would look at something in the 25-30,000 range. A four seater would be more practical. When my wife and I got married, we were both driving 2 seat sports cars. That wasn't t practical for very long.

As for the car becoming outdated, by the time you re ready to trade the car in 6-10 years, the world will still have a large number of gasoline engine cars.

The next step in your progression to financial independence , regarding cars, will be to buy the cars with cash. If I was thinking about a 50,000 dollar car purchase with payments, I would instead get a 25,000 dollar car but make 50,000 car payments, half to the lender and half to my self toward my next car purchase. Then, my next car I would write a check for.
bltn
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Re: What should a 23 year old consider before purchasing a Tesla?

Post by bltn »

Danimals543 wrote: Tue Dec 08, 2020 2:34 am
kiwi123 wrote: Tue Dec 08, 2020 2:18 am 'Boglehead advice' will be a 23-yr old making $100k is too soon to be buying a $50k eclectic vehicle (that will be outdated in 3 years as EV tech is progressing rapidly). "Wisdom" on this forum would be to get a cheaper new or used vehicle for <$30k which has the same utility as the Tesla (although not the same 'cool' or 'fun' factor) e.g. your usual suspects of toyota, hyundai, honda, etc. etc. You'll also have an extra financial cushion if you lose your job in 6 months.

In the non-boglehead world you can certainly get it if you want it... it will just delay financial independence by 2-3 years and potentially set you on a path of living beyond your means as you'll probably want to upgrade to the newest tesla in 4 years because you just got a fat raise to $150k :-)

(Anyway, you already know the answers you'll get on this forum for that kind of question)
How can it delay financial independence? I’m already maxing out my 401k and Roth IRA. Most Americans barely contribute anything to retirement.

Would a $25k car be a poor choice? I’m considering getting a more reliable car but at $25k now...
Never compare yourself to most Americans. You re already above that level in terms of salary, savings, and financial thinking. You came to this forum to get held to a higher standard.

Look at a 25,000 dollar alternative.
bltn
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Joined: Mon Feb 20, 2017 9:32 pm

Re: What should a 23 year old consider before purchasing a Tesla?

Post by bltn »

Danimals543 wrote: Wed Dec 09, 2020 12:45 pm
bagle wrote: Wed Dec 09, 2020 12:21 pm
Danimals543 wrote: Wed Dec 09, 2020 11:27 am Thanks guys. I decided against buying a Tesla.
Wise choice. Otherwise, you might get distracted from work with all those heated online discussions as to whether Tesla is close to achieving Level 5 full self-driving or not :.)
Haha yup! :) now I’m looking at a VW GTI (the 2015+ models have good reliability and it’s a fun car for waaaay cheaper at $20k).
I posted my above comments before reading far enough in the thread to see your change of mind. And you re looking at a car you can pay cash for and have fun with. Very impressive. Reminds me of myself at your age.
Best of luck.
Hang around this forum.
tibbitts
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Joined: Tue Feb 27, 2007 6:50 pm

Re: What should a 23 year old consider before purchasing a Tesla?

Post by tibbitts »

OP, if you've decided what to do, it would help to update the original post. Most people won't read the entire thread.
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