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You wouldn't have rather bought your $76k car 13 years ago, with a loan and such?I drove my 07 Camry for 13 years….
So I could pay $76k cash for my current car.
It also depends on what kind of vehicle it is. A 2012 BMW 3-series from a "corner" dealership or a 2004 BMW 3-series (as described in the first post of this thread) would be a higher risk than a Toyota Corolla or Prius. And a Jaguar might make a BMW look reliable...Owning another older vehicle outright eliminates the monthly loan payment, but incurs maintenance and repair risk due to the age of the vehicle.
Why would I want to borrow money from someone? I earn my money and I spend my money. I like knowing that if I drop dead today, my family has nothing to worry about. I have a mortgage and that should be paid off soon. I’m a slave to no one and everything in my possession is mine.You wouldn't have rather bought your $76k car 13 years ago, with a loan and such?
Not to sound like a contrarian or be combative, but you say you don't want to owe an entity for a possession, but you have Mortage. That is literally what a mortgage is, so, what is the difference? Or is a Mortgage the only situation in which you'd make an exception. I have the opposite mindset as you, if you feel that way 100% - I would much rather owe everything, but enjoy it on a day to day basis, until it's paid off, than to live lacking the things that would make me happy, just so that I don't have debt. It worked for me. But to each his/her own. If it worked for you, kudos to you.Why would I want to borrow money from someone? I earn my money and I spend my money. I like knowing that if I drop dead today, my family has nothing to worry about. I have a mortgage and that should be paid off soon. I’m a slave to no one and everything in my possession is mine.
I don’t like the bank owning my stuff. It’s called “delayed gratification” which seems to be a foreign subject to a lot of folks. But I tell you what, there’s no feeling like being debt free and building wealth and knowing that everything you have is truly yours and nobody can take it away from you. I started out with nothing - living paycheck to paycheck. I worried. A lot. I don’t miss that life at all. That’s just how I roll…
This is a very good example of a false economy....sometimes you have to stop and say that this search for a bargain is costing more in shoe leather than I am saving...but the hardest thing is to admit it first to ourselves and then to others...so, well donea good story with a worthwhile lessonSo, I bought a brand new '19 (July Build) Model 3, Standard Plus, Autopilot, White on White. LOVED the car. However, I got it under a Car Loan. The total of the Monthly Payment, including Insurance, was $663.00.
So, after a year and a half of owning it, I thought my lack of driving and lack of actual need for this "extra car" was not worth the price tag. So I decided to sell in March of '21, at a small profit, so that I wouldn't have to pay so much monthly for a car. I thought I would just buy a cheap old car, cash, to not have a car payment, and insurance would be much much lower.
I'm very familiar with BMWs, so I decided to get a 2012 e92 from a "corner" dealership. Unbeknownst to be (and supposedly to them), the car had deep-rooted issues that ended up costing me a lot to fix. I decided to sell the car, and get an even older car, which would be cheaper to repair, and had several inspections done on. I went with my favorite chassis - e46, 2004. But I shipped it from 4 states away (it was the only reasonable one I found).
This car was perfect for a while, but eventually it did need a couple of things.
Almost a year after selling the Model 3, I decided to run the numbers of how much I had "saved" by owning a car that I bought outright, and having no car monthly payment.
Here is the ACTUAL breakdown of what it came down to
-GAS Between March 21, and Jan 22:
= $1100
-Repairs:
= $170 - smoke test
= $270 - O2s
= $20 - Oil and O2 adapter
= $285 - Touchscreen
= $459 - Drive shaft Work
= $ 515 - Drive Shaft
= $302 - Fuel Filter
= $411 - 05/19
= $175 - BMW Dealer Diag
= $878 - E92 repairs
= $120 - Misc Repairs
= $170 - Misc Repairs
= $1400 -E92 Repair
= $350 - Insurance, total for the year
Total cost for "owning an old, gas car, no car payment"
$6625.00
-----------------
Tesla = Sold for $3214 net profit
e92 = bought for $8579 - $3214 = $5365
e92 Sold (after all the repairs, and deciding not to keep it)
for = $8500-$5365 = $3135
Bought e46 for $3012+$2500 (shipping)= $5512-$400 (rebate) - $3135
Total spent on "acquiring" e46 - $1977.00
GRAND TOTAL going from Tesla in March to Jan '22 (Total of owning old car) - 6625+1977 (acquisition)= $8602
------------------
- How much have I "saved " by having crappy cars, in 10 months, after selling Tesla
= Tesla Monthly Payment, $663 x 10 = $6630.00
GRAND TOTAL going from Tesla in March to Jan '22 = $8602 MINUS $6630
= $1972
-----
So, Too Long; Didn't Read:
I didn't save a Cent....it actually COST me $1972 to trade my brand new Model 3 for a "cheap old car" with no car payment.
Now, I know this whole anecdote is riddled with mistakes. (not to mention that people will say "well, you got a bmw - they're super expensive to fix). But they're not uncommon mistakes. And the decisions are decisions that I have seen friends and family make, attempting to accomplish the same thing. So, if anything, this is a cautionary tale. I'm pretty old. I've never had the "fluid cash" to buy a $45000 car, cash, outright.
I do today.
But regardless of whether I did or not, I will never, because of this experience, try to go from a "high monthly payment" to a crappy old car just to avoid paying that car payment.
In fact, I don't think I'll ever get a used car ever again. I don't think the stress is worth it.
-Ron
Yes mortgage was my only exception. Financed over 15 years and will have it paid off early.Not to sound like a contrarian or be combative, but you say you don't want to owe an entity for a possession, but you have Mortage. That is literally what a mortgage is, so, what is the difference? Or is a Mortgage the only situation in which you'd make an exception. I have the opposite mindset as you, if you feel that way 100% - I would much rather owe everything, but enjoy it on a day to day basis, until it's paid off, than to live lacking the things that would make me happy, just so that I don't have debt. It worked for me. But to each his/her own. If it worked for you, kudos to you.
I was there too, living paycheck to paycheck, and owing a car payment. But I began being more aggressive. I made investments (like I said previously), instead of saving. I started buying the car of my dreams immediately, instead of going through crappy cars to get to the "good one". I bought properties, and turned them into profits, instead of buying one and hope I can pay the 30 years. As I said, it worked for me. This way of being is definitely not recommended. I came out on top, but I can see how someone could easily end up with the opposite outcome.
I think you're right. ThanksThis is turning into a discussion about general money / wealth management, etc, which is no longer related to either model 3s or tesla in general. If you want to continue this part of this discussion, I will likely move this thread to off topic subforum so it can continue.
Ah ok. Well, good for you. I'm glad it worked out. And congrats on the mortgage. I remember that feeling, it's the best. I remember it was a very odd feeling, to know that the property is just...yours. No payment to any entity. And the refreshing feeling that you now own something that you could just as easily turn into cash, if you so chose to - instead of owing a bank for something you didn't even own (because of the lien). That feeling really was a life-changer for me.Yes mortgage was my only exception. Financed over 15 years and will have it paid off early.
Yes, that definitely crossed my mind. I did make a small profit with the Tesla sale. But when it came to buying a car like you say, I really didn't want to buy something that would feel like a "sad middle ground". I was going to either buy the Model 3 right back, and pay the $50k, or I would go the complete opposite route with an old BMW, so that I could "save" money by working on it myself. I did the latter, and that's what this post is about - and ironically, I did the former just 3 weeks ago, after the whole debacle of the BMW.I think if you would have sold the Tesla for a profit and bought a new or CPO car that cost $20-40K you would have seen the savings and not had repair bills. Example Toyota has free maintenance for the first 2 years plus a 60K mile warranty on the warranty. Hyundai and Kia have 100K mile powertrain warranties. Because you don't drive much and many vehicles can achieve 30MPG+ I think the savings was there. For every $1K you finance it's roughly $20 a month in car payments. Going from a $50-60K car to a $20-40K car is big savings (usually insurance is cheaper too).
The savings were more likely to be there if you chose an old cheap car that was more reliable with less costly maintenance and repair and lower fuel consumption than an old BMW.Yes, that definitely crossed my mind. I did make a small profit with the Tesla sale. But when it came to buying a car like you say, I really didn't want to buy something that would feel like a "sad middle ground". I was going to either buy the Model 3 right back, and pay the $50k, or I would go the complete opposite route with an old BMW, so that I could "save" money by working on it myself. I did the latter, and that's what this post is about - and ironically, I did the former just 3 weeks ago, after the whole debacle of the BMW.
I do agree with you that the savings could have been there.
That is sort of my point. As maintenance becomes the primary profit center for classical dealers, it doesn’t make economic sense to pay inflated parts prices, and crazy labor rates.Isn’t this what people have done for the last 50 years…keep an older car and pay for maintenance and repairs?
No thanks. That’s WHY I got a Tesla….actually 2 of them.