Wow. Put away $500 a month? You make it sound so easy. For people who don't currently have a car payment, this is just the monthly payment for the car ($35K for 72 months at 3% is $532) set aside in advance. But folks who are currently paying on a lease or loan and who are waiting to trade up to the Model 3 are not likely to just have another $500 a month of spare cash. I think that the average household is only going to have, at most, $100 or so that they can squeeze out.
My first job out of college paid $2,000 per month gross. I saved $500 per month in cash. Yes. A full 25% of my income. It was easy. Of course, I don't drink, smoke, do drugs, or gamble. I was not married. I had no children. And I despise being broke. So, for me, it was easy. All it takes is dedication, patience, and a modicum of self control.
I am vehemently opposed to leases and loans. Mostly because I don't like paying interest. If it were ordinary, everyday, straight, and honest, simple interest, I'd be good. But from my perspective amortized lending is the spawn of the devil.
Again, if you are unable to save at least 25% of your income if you want to... You are either not making enough money... Or you are spending far too much of it. Cut back, sacrifice, learn to live with what you have, and get what you want later.
A
2013 CNN article writes:
Roughly three-quarters of Americans are living paycheck-to-paycheck, with little to no emergency savings, according to a survey released by Bankrate.com Monday.
Fewer than one in four Americans have enough money in their savings account to cover at least six months of expenses, enough to help cushion the blow of a job loss, medical emergency or some other unexpected event, according to the survey of 1,000 adults. Meanwhile, 50% of those surveyed have less than a three-month cushion and 27% had no savings at all.
The problem with the
'average household' is that so many people have been brainwashed into adopting the
'I can make the payments...' principal of finance. They simply refuse to live within their means. They are in debt up to their eyeballs and are comfortable in that position. I am not.
I get your overall point, though -- start saving now. But this is supposed to be the first iteration of the people's car -- the electric that anybody can afford. But realistically it's not the car that everyone will be able to afford (sadly). It will simply be more affordable than the S and the X.
Again... Do you want to be able to afford the
'payments' or the
'product'...? Too many people lose sight of that. They simply want to acquire things, so they can proclaim,
"Look what I got!" They don't consider that having is not the same as owning. Or, that getting, is not the same as affording. If there are repossession agents that have you on speed dial, you can't afford it.
My current biggest regret is that when I learned that Tesla Motors intended to build what was termed in automobile magazines a
'luxury sports sedan' as their second car... I stopped following the company entirely. I despise luxury cars in general, and sports sedans in particular.
I spent the Summer of 1985 working for my Uncle's company. I washed and detailed cars at a condominium complex in Beverly Hills. So I saw all the luxury marques up close and personal, while still in my teens. I was not particularly impressed. I determined that everyone was doing a riff, their own interpretation, of design themes from Rolls-Royce. Some just flat out copied Rolls-Royce in everything from woodgrain, to switchgear, to the central clock on the dash -- only with poor materials. Plastic instead of chrome. Vinyl instead of leather. Synthetics instead of wool. And all of this hearkened back to the very beginnings of automobiles as literal horseless carriages. That disgusted me then, and still does.
I have always thought BMWs were ugly as sin
(They actually have looked OK, since about 2012 -- but traditional BMW fans don't like them now. HAH!). That they were advertised as
'THE ULTIMATE DRIVING MACHINE' was offensive to me. Still is... So, with their cars being the poster children for the
'sports sedan' I was put off by a long shot. And, I noticed a progression... Mercedes-Benz wanted to be Rolls-Royce when they grew up... BMW wanted to prove they could one-up Mercedes-Benz... Volkswagen's primary excuse for existence was BMW... And all of their cars were gawdawful ugly. I had no idea why these vehicles were so revered in Los Angeles, and I didn't care. I knew they weren't for me.
Had I been paying attention, despite my personal prejudice against the
'luxury sports sedan' concept... Even in late 2011 or early 2012, I probably would have picked up 500 shares of TSLA. DOH! Then I would have kicked myself later for not getting 1,000 instead. ;-)
Who from Europe keeps telling the Model S is too small?
I'll admit, this is probably a very
AMERICAN-centric point of view regarding the Model S... There was one article written were someone absolutely tore into the Model S for not being
'luxurious' enough... The guy on purpose grabbed the most expensive iteration of the AUDI A8 L and began to rave about how much better it was than the Model S. Never mind that he purposely fudged the range of the diesel powered AUDI to extreme levels, embarrassing himself more than Tesla Motors... Or that he flat out dismissed the comparative fuel cost of diesel versus electricity, especially with the Tesla Supercharger network expansion... Or that the performance of the diesel was woefully less than the gasoline AUDI -- which got its [BUM] handed to it by pretty much every iteration of the Model S.
I have seen similar sentiments expressed, in two different ways...
1) Some refuse to accept that the Model S competes with the Mercedes-Benz S-Class, and repeatedly act as if it should be compared to the E-Class instead.
(Somehow, they always forget about the CLS-Class...)
2) Others repeatedly express their dismay over the conspicuous absence of
'essentials' such as lighted vanity mirrors, storage bins, grab handles, map pockets, folding armrests, and a plethora of other doohickies carried over from a stagecoach and team of six. They claim there isn't enough head room or leg room and a
'real luxury car' should have a separate trunk instead of a hatchback and that Tesla Motors should immediately introduce a stretched, extended version because there is
'no way' that anyone in search of true opulence would be interested in their cars, and they are sure to
'lose sales' as a result.
And as for those long-wheelbase versions of the German luxury cars, those are an even rarer sight on our roads than a Model S. And for the same reason, inner city driving and parking would be a nuisance at best. If at all, those cars are sold purely for long range executive travel over the Autobahn, or perhaps for chauffeur services.
OK. That makes sense. Thanks for the sense of perspective on this.
What? So you would have saved up about 300k $ before you bought a Model S or X? Or 100k+ $ for a Model 3?
I don't know anyone who would - or could - do that with any larger (i.e. >10k) purchase.
No. That's what I would have done in my early twenties. As I got older, more used to saving, I actually raised the limits gradually. From 3:1, to 4:1, to 8:1... Today, I would recommend not buying unless I have twelve times as much cash on hand.
~*ducks*~
Look, either you can afford something, or you can't. If you want to buy a $150,000 car, and you don't have $1,800,000 in assets... You may be making a mistake. Because really, you can probably find a car for 1/3rd the price that has 90%-95% of the performance, luxury, and convenience features. You are just buying a brand, a label, and nothing more... Unless, of course, it happens to be a Tesla Motors product. So buy two!
:-D
