Comment by anticorporate
17 days ago
The "50k automobile" sounds like almost an aside in this conversation, but it's still bothering me.
I know there are reasons that new car prices have gone up so much in recent years, but is $50k still "reasonable" in the context of a financial literacy conversation? I too ended up going down the path of buying new cars when I became an adult, partially due to having no car repair education (something I only gained on my own later in life), partially due to living in apartments with no place to work on them early in my career, but mainly due to the incredible pressure to be able to get to work reliably in a society without adequate public transit.
But my new cars cost more like $18k (2009), $26k (2014), and $31k (2019). Each felt like a luxury at the time, having grown up with used cars generally 15-20 years older than the year we drove them in. Is $50k not still a good $20k more than a base model Camry? It sure still sounds like a luxury to me.
My BMW 328xi had tired automatic gearbox. Only Tesla wanted to have it for trade in, because the gearbox was still working more or less normal. No person would buy it in such shape, trade-in elsewhere didn’t work either. I was also driving a lot in that time. 110€ weekly gas bill. And Tesla had a small discount plus zero interest offer at the time. I signed for it and got model y long range. My first new car in whole life.
My alternatives were dire: repair the gearbox for 8k. Ditch bmw and get some used vehicle for 25k. Take some other new vehicle with 6-8% interest rate. Or buy some 15 year old crap car and spend tons of money repairing it.
Fast forward to today: I forgot broken bmw, got used to comfy, fast family car. My current workplace offers free electricity as a benefit, so I use supercharger only few times a year on vacation. Financially it looks good: gas and repair costs are gone.
I can tell only one thing: each buy or not to buy decision is very individual. If bmw wouldn’t start falling apart after 80k miles I would keep it as long as I can. I also wouldn’t buy Tesla in first place if somebody else would buy bmw. I wouldn’t need a car at all if I had no relative to care for 30 miles away.