New car out of residency

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2Fast2Des

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I know the going rule of thumb is to live like a resident for a period of time after residency to build up savings/pay off loans, etc. Is it worth buying a nice car as the only reward for finally being done? Thinking about Tesla (only because $7500 tax refund will be running out by end of year), or atleast a good quality used car. I figured before having a family and then never enjoying life when all the money will go towards kids, it would be nice to have 1 vice, especially in a dual income household. Never know when the grim reaper will show up, it would be nice to enjoy life a little bit too instead of bracing for the sky to fall forever. We definitely will try to shore up all the retirement accounts and maximize loan repayments as feasible of course as well.

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Seriously? If you want to "enjoy life", invest some money in nice memories for your family, not an expensive midlife crisis unreliable car.

A nice and reliable (and cheap to repair) $30-35K car (my advice: used Lexus), new or used, should be more than enough.

I drive a so-called "appliance", and grin every single time I pass one of these fancy-shmancy status-symbols on the highway. It cost me less than $20K new (cash), it's cold in the summer and warm in winter, uses 32 mpg on average, it's comfortable for long trips, it's pretty quiet, it's even pleasant to drive, the latest model even has all kinds of security gadgets standard. I know it will last me at least 150,000 miles without any major issues, probably much more.

My wife's car was almost double as expensive (still very reliable), and she agrees it was not worth the difference (we bought it first). But happy wife, happy life, and she rarely splurges on anything.
 
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I know many dual income couples who make north of 8-900k. If that’s your situation, it’s fine to buy a Tesla. You’ll still be able to retire early if that’s what you want. FWIW my sister who is not a car person at all and drove the same Honda Civic for 25yrs absolutely loves her Tesla. She is now a car person.
 
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spend your money on whatever you want, just recognize what the costs are (as well as the hidden costs of what else you could've done with the money). Nothing wrong with buying a decent car, but financially it's usually better to buy one used as the initial rapid depreciation is already priced in. I spent $40K on a new car 6 months after I graduated residency (paid cash for it) and will probably drive it for 10-15 years.
 
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Seriously? If you want to "enjoy life", invest some money in nice memories for your family, not an expensive midlife crisis unreliable car.

A nice and reliable (and cheap to repair) $30-35K car (my advice: used Lexus), new or used, should be more than enough.

agree with this.
a 2-3 year old off lease lexus GS 350 AWD with less than 40k miles, would be my pick by a long distance. have thought about this for a while and then my trusted mechanic also recommended this after i sought his opinion on this exact question.
it should cost around 30k. actually we purchased one for my father for his birthday last year and he is very happy. he prefers american cars but he loves to low cost of maintenance.
if you take care of it - will last you 10 years easily and since its a toyota product, repairs will not cost you compared to european counterparts.

or you can totally embrace FIRE lifestyle, pay off your loans first, and think of cars as depreciating assets and merely tools of transportation, and stick to honda accord/toyota camry until you have a nice retirement fund as well as a taxable account, have emergency funds, a house downpayment, and roths and 529s funded...a new car would typically come after all those things. and you can probably pay cash for it.
 
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Cars are NOT assets, except the return on investment they produce by allowing one to get a 6-digit income. Otherwise they require constant capital expenditures for maintenance, gas, PROPER insurance, taxes, they lose value fast, and one could argue that, in major cities, are an unneeded luxury.

Anyway, I was just trying to point out that it's pretty dumb to spend a lot of money while one is not financially independent yet. The most important "retirement" account is the one called "F you money", the one that allows its owner to walk away from a bad job/boss anytime. Actually, if one's boss knows one can walk away anytime, one will have a MUCH better life. You can tell, even on the forum, who could leave anytime (my spouse and I are probably less than 10 years away).

The dumbest thing one can do, out of residency, is to give up the resident lifestyle. Try aiming for much less than 100K in annual expenses, invest everything else wisely, and you'll thank me later. Money doesn't bring happiness, but financial independence does. Sorry for sounding preachy, but I am actually doing you a favor, OP.

Learn to think like Buffett. One dollar spent today is not one dollar; it's actually 5.7 dollars 30 years from now, even at only 6% average annual return. Choose your splurges well. Don't "reward" yourself for doing something any smart person would do (e.g. graduating); that's what a financially dumb person does. The reward for summiting a mountain lies in the pleasure of the climb and knowing that "you did it". Or, again, as Buffett likes to say: there are people who keep inner scorecards (trying to be the best one can be, regardless how one appears to others), and people who keep an outer scorecard (aiming to look good, even if one knows that one sucks at the job). Try to keep your personal "rewards" at 1-2% of your annual net income (after all taxes and expenses) EVERY year. Otherwise, you will be on a very slippery slope.

Trust me, looking at your multimillion net worth, and the peace of mind that your family would be safe even if you died tomorrow, will make you smile way more frequently than any fancy car (unless you bought it for peanuts). Same goes for the fancy house, and all expensive "splurges". NO, YOU DON'T "DESERVE" IT, NOT UNTIL YOU ARE FINANCIALLY INDEPENDENT FOR LIFE!
 
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Everyone has their own tastes in what to spend on, just be aware if you splurge on a car, you should skimp on housing, etc. It's all a balancing act- there is no rules, it's your life. But you should try to max out any retirement options and aggressively pay off any student loans/debt (an ideal range would be within 5 years of graduation from residency/fellowship.)
 
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Take a nice trip or buy you a nice reliable $20-$30k car. Knock out school loans as quick as possible. Very HIGH odds that first job may be a dud. Always nice to have lots of “FU” money available if you need to move. Don’t look at the reward for having a high salary job as “being able to buy stuff”. Look at it as “being able to buy freedom”. It’s easy to become a slave to a high income “lifestyle”...
 
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I know the going rule of thumb is to live like a resident for a period of time after residency to build up savings/pay off loans, etc. Is it worth buying a nice car as the only reward for finally being done? Thinking about Tesla (only because $7500 tax refund will be running out by end of year), or atleast a good quality used car. I figured before having a family and then never enjoying life when all the money will go towards kids, it would be nice to have 1 vice, especially in a dual income household. Never know when the grim reaper will show up, it would be nice to enjoy life a little bit too instead of bracing for the sky to fall forever. We definitely will try to shore up all the retirement accounts and maximize loan repayments as feasible of course as well.
You can also buy one second hand.
I've not done any maintenance on mine for almost 3 years, you never need to change the brake pads and my tires are still ok after 40k+ km.
 
The Tesla Model 3 is not expensive at all right now, unless you go for the performance model which has the sub-4 sec 0-60. Especially when you consider the gas savings and incentives. And the standard version which will be released next year is very affordable. I'm blown away by how amazing this car is. Amazing acceleration, torque, handling, and range. And this is coming from someone who's last car was a 335i. Tesla has changed the game entirely. In 3-4 years, their cars will easily have 400-450 mile range
 
The Tesla Model 3 is not expensive at all right now, unless you go for the performance model which has the sub-4 sec 0-60. Especially when you consider the gas savings and incentives. And the standard version which will be released next year is very affordable. I'm blown away by how amazing this car is. Amazing acceleration, torque, handling, and range. And this is coming from someone who's last car was a 335i. Tesla has changed the game entirely. In 3-4 years, their cars will easily have 400-450 mile range
You think $42.7K after the federal tax credit (in most states, including a $1200 "destination & doc fee"), plus possibly a sales tax, is "not expensive at all", for a model with expected "average" (read bad) reliability (especially an unproven new model) with only 4 years/50K of warranty? This ain't Lexus.

Even driving 15,000 miles/year, at 130 mpg equivalent (versus 40+ for a Toyota/Lexus hybrid), the gas savings are 250 gallons/year, i.e. minuscule when compared to the cost of repairing (and probably insuring) such a car.

 
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yall are ridiculous. hes right out of residency with dual income and you guys think he should buy a used car? Dude go out and buy yourself a car you like. He seems pretty level headed im sure he wasn't thinking $100K + . If you're into cars and it makes you happy then you should get a nice car for yourself. If you're living paycheck to paycheck for all your expenses obviously a different story.
 
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Ok, you will be an attending and make good money. If you want to buy a good car, buy it. For Tesla, if you live in CA, you can get additional 2500$ state rebate.

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Ok, you will be an attending and make good money. If you want to buy a good car, buy it. For Tesla, if you live in CA, you can get additional 2500$ state rebate.

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i don't think he will be eligible for the $2500 since its based on income. you will get the $7500 federal though if you get it by end of 2018.
 
i don't think he will be eligible for the $2500 since its based on income. you will get the $7500 federal though if you get it by end of 2018.
Income based on last year's tax. He was a resident last year.

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Ok, you will be an attending and make good money. If you want to buy a good car, buy it. For Tesla, if you live in CA, you can get additional 2500$ state rebate.

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I just love this kind of "thinking". This is like: "I am buying a house, because I will get a tax deduction on my mortgage interest" (I hear this all the time). And we still give doctoral titles to the latter.
 
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I just love this kind of "thinking". This is like: "the more expensive the house I buy, the bigger my tax deduction". And we still give doctoral titles to the latter.
Tesla 3 (the 400miles one) is no more expensive than BMW 3 series. Once out of warranty, the maintenance and repair of BMW will cost you an arm and a leg. Trust me, you need to visit the dealer at least once a year. BMW =Bring My Wallet

Tesla is a low maintenance car. Extra fed state rebate of 10k is good.

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Tesla 3 (the 400miles one) is no more expensive than BMW 3 series. Once out of warranty, the maintenance and repair of BMW will cost you an arm and a leg. Trust me, you need to visit the dealer at least once a year. BMW =Bring My Wallet

Tesla is a low maintenance car. Extra fed state rebate of 10k is good.

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I don't buy BMWs (or other European brands) either. It's a friggin' appliance on wheels. If one wants a "driver's car", buy a Mazda.
 
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Seriously? If you want to "enjoy life", invest some money in nice memories for your family, not an expensive midlife crisis unreliable car.

A nice and reliable (and cheap to repair) $30-35K car (my advice: used Lexus), new or used, should be more than enough.

I drive a so-called "appliance", and grin every single time I pass one of these fancy-shmancy status-symbols on the highway. It cost me less than $20K new (cash), it's cold in the summer and warm in winter, uses 32 mpg on average, it's comfortable for long trips, it's pretty quiet, it's even pleasant to drive, the latest model even has all kinds of security gadgets standard. I know it will last me at least 150,000 miles without any major issues, probably much more.

My wife's car was almost double as expensive (still very reliable), and she agrees it was not worth the difference (we bought it first). But happy wife, happy life, and she rarely splurges on anything.
You either feel the thrill of driving a powerful vehicle or you don't. I was a car as appliance guy until I got my current vehicle. The thrill I feel at I'm hitting the gas or whipping around corners is awesome, and I get perhaps five people approaching me about how much they love my car each week, and I love talking cars so I enjoy the small talk.

I don't understand luxury SUVs and the like though. They don't perform all that well, aren't exciting to drive, and few people eye them and think much of them.
 
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You either feel the thrill of driving a powerful vehicle or you don't. I was a car as appliance guy until I got my current vehicle. The thrill I feel at I'm hitting the gas or whipping around corners is awesome, and I get perhaps five people approaching me about how much they love my car each week, and I love talking cars so I enjoy the small talk.

I don't understand luxury SUVs and the like though. They don't perform all that well, aren't exciting to drive, and few people eye them and think much of them.
I get it. Hence my recommendation for Mazda.

Does the dealer pay your fines, or do you enjoy the car only on your private track? Yeah, "whipping around corners" for 50K... "priceless"! :rolleyes:

I mean, seriously, this ain't the Autobahn. So why even bother buying a powerful car. Just to accelerate a few seconds faster? Seriously?

Just my 2 cents. Whatever makes you happy.
 
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I never really thought about buying a car until after a few months of working.. we will need a new car regardless since one of ours is on break down watch and the other may have some costly repairs lined up. Was thinking about Tesla model 3 more because of the expiring tax refund, otherwise I wouldn't entertain that car or price range until like FFP said, about solidifying a financial future.
 
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Since it's this thread again, I'll just throw in a word for a used low mileage E46 M3 like I usually do. $20K for a reliable car that will make you smile when you drive it. Not so flashy it'll attract cops.

I'm doing a crani next week on a guy younger than me with a GBM. Don't forget to live.
 
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Seriously? If you want to "enjoy life", invest some money in nice memories for your family, not an expensive midlife crisis unreliable car.

A nice and reliable (and cheap to repair) $30-35K car (my advice: used Lexus), new or used, should be more than enough.

I drive a so-called "appliance", and grin every single time I pass one of these fancy-shmancy status-symbols on the highway. It cost me less than $20K new (cash), it's cold in the summer and warm in winter, uses 32 mpg on average, it's comfortable for long trips, it's pretty quiet, it's even pleasant to drive, the latest model even has all kinds of security gadgets standard. I know it will last me at least 150,000 miles without any major issues, probably much more.

My wife's car was almost double as expensive (still very reliable), and she agrees it was not worth the difference (we bought it first). But happy wife, happy life, and she rarely splurges on anything.

lol one of my favorite posts of yours.. with you all the way, snazzy cars are the machine of the last generation
 
lol one of my favorite posts of yours.. with you all the way, snazzy cars are the machine of the last generation
Seriously, I drive about 20,000 miles/year, and you don't wanna know how many times I am stuck behind an expensive car with my $20K econobox (currently worth 10K). And then, I am the one accelerating to pass them, while they are driving at 55-60 mph. It's ridiculous. Especially when it's a BMW or similar. I swear many people drive econoboxes faster.

There are very few places where one can really enjoy a fast car in the US. Even out West, I was cautioned not to drive fast in the middle of nowhere, because of the cops. I drive faster on the East Coast than in Las Vegas (apparently they fine you even at 5 mph above the limit). It's like getting excited that whatever expensive fluid improves BP in the ICU by 10 mmHg for an hour, while mortality stays the same. Some idiots have set the speed limit at 55 in most of the country (for efficiency reasons, back when there were oil embargoes and gas guzzlers), and that's how it still is (65-70 if you're lucky). Let's not mention the traffic. Where I live, the *****s-in-chief close down 2 lanes of highway for miles, while working on a 300 yard-section of one lane.



But, hey, I am not arguing. De gustibus...
 
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Most financial people (especially those in the /r/financialindependence of reddit and those who want to FIRE) will tell you to save every last penny, never eat out, don't take any vacations, and drive around your inherited uncle's 91' Ford Taurus until it dies and once that happens - walk. When I was a resident, I had an attending tell me - "Why take a fancy vacation now when you can retire a couple month's earlier?" Have you seen old people on vacation? They travel places to take naps and do things much differently than if they were young. F that. Don't forget to live. Being a dead rich guy isn't cool.

It's about being reasonable. Pay down your credit card debt. Have 6 months to a year in emergency fund. Max you retirement accounts. Attack your student loans. See what you have left over after your fixed monthly expenses. More than likely you'll be able to get that Model 3 Performance and be just fine with a decent chunk left over. Now if you want something with a horse or a bull on it, it might be a different story. But you can always live at home the parents with zero expenses and drive one of those around. Of course, then you live at home.
 
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Bought a slightly used vehicle with my sign on bonus 10+ years ago. 45k.
Just upgraded it last winter and enjoyed every mile I was in it.
 
I get it. Hence my recommendation for Mazda.

Does the dealer pay your fines, or do you enjoy the car only on your private track? Yeah, "whipping around corners" for 50K... "priceless"! :rolleyes:

I mean, seriously, this ain't the Autobahn. So why even bother buying a powerful car. Just to accelerate a few seconds faster? Seriously?

Just my 2 cents. Whatever makes you happy.
Not many officers out in the sticks, you can drive in a fairly spirited manner without issue. And it is more about high speed/inertia/G-forces than it is about pure acceleration
 
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Pgg always has sensible posts. The used car market has a ton of awesome inventory.
Last year I bought my first new car ever (and likely last).
6 digits at signing.

Worth a lot less than that now.
 
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Pgg always has sensible posts. The used car market has a ton of awesome inventory.
Last year I bought my first new car ever (and likely last).
6 digits at signing.

Worth a lot less than that now.
Those 6 digits probably represented about 1-2% of your net worth, right? And you could retire today, if you wanted, couldn't you? And you may even have another significant breadwinner in the family, am I wrong? ;)

This is how young docs get into trouble, and become slaves to their new "attending-level" lifestyles. That's all I wanted to point out.

Otherwise, everybody deserves to spend their hard-earned money any way they wish. It's THEIR money. Just don't ask for welfare when something unexpected happens and there is not enough left.

@pgg rules. By the way, @pgg, you can see this kind of thread on Bogleheads on a weekly basis.
 
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Even at low speeds performance cars are easy to appreciate in terms of tactile sensation, sound, and visceral connection. For some people it’s worth every penny, others could care less.
 
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Vehicles are like TVs. The next year model might have some new flashy badging... but overall the vehicle from 1-5 years ago is still a beast and just as good. Save your money and find something you want used.

2013 range rovers (new generation) are selling for 50% of what they were bought for.
They are beautiful vehicles and will cost you 50-60k vs 120k+
 
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I will add that you should factor in your commute, and I'm not talking about cost, rather comfort and enjoyment. I would say that if you have to commute anything over 20 mins you want to enjoy it the best you can and if that's in a Tesla, then by all means, buy a Tesla. You'll spend so much time in that car you're going to want to enjoy it as best as possible.

Having said that, if electric is your thing, don't sleep on some of the other electric cars which can run around 35k and get the same range as a Tesla.

Edit: I wil add that I didn't get the exact car I wanted with my last purchase and now regret it a bit and now it will cost me more money to eventually get the car I want.
 
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Vehicles are like TVs. The next year model might have some new flashy badging... but overall the vehicle from 1-5 years ago is still a beast and just as good. Save your money and find something you want used.

2013 range rovers (new generation) are selling for 50% of what they were bought for.
They are beautiful vehicles and will cost you 50-60k vs 120k+
One of my best deals ever was buying an award-winning plasma from the year before, right when they were going out of production (November 2014, I think). 50% off MSRP.

There are similar deals with new cars (last year's model), especially at the end of December, especially if the model has been redesigned that year. Don't buy the "latest and/or greatest" (e.g. Tesla 3), because you'll end up paying through your nose for insignificant differences. Used cars are (almost always) the best values.

Young grads, don't be like Mike Tyson! The spring could go dry anytime.
 
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Vehicles are like TVs. The next year model might have some new flashy badging... but overall the vehicle from 1-5 years ago is still a beast and just as good. Save your money and find something you want used.

2013 range rovers (new generation) are selling for 50% of what they were bought for.
They are beautiful vehicles and will cost you 50-60k vs 120k+
I believe there was an Always Sunny episode that covered this that aired about 4 days ago.
 
Vehicles are like TVs. The next year model might have some new flashy badging... but overall the vehicle from 1-5 years ago is still a beast and just as good. Save your money and find something you want used.

2013 range rovers (new generation) are selling for 50% of what they were bought for.
They are beautiful vehicles and will cost you 50-60k vs 120k+


In a similar vein I once got a good deal on a 3 year old Porsche with 11000 miles on it. Drove the crap out of it putting an additional 60000 miles on it over the next 3 years. Then a drunk driver ran into it and totaled it. My insurance company gave me $600o less than what I paid for it. Overall it was one of the cheapest cars I ever drove. Tires were the only big maintenance item. It was fun to drive and problem free.
 
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I agree used or CPO is also a decent option. You can find some Tesla Model S's going for 50-60k. Same for M and AMG cars.

Some people will argue about the utility and cost of a car. What they aren't telling you is that they have an expensive wine/whiskey collection, luxury watches, have a boat, or an arsenal of guns. Most people aren't saving everything and more often than not, have some sort of money vice. If you are a car enthusiast, you already know.
 
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CPO is usually worthless, except for the warranty (if it's manufacturer's, and bumper to bumper at least for the first year). It's the new scam.

Just buy some old person's barely used car (especially if still under warranty) and take it to a trusted mechanic first.
 
You either feel the thrill of driving a powerful vehicle or you don't. I was a car as appliance guy until I got my current vehicle. The thrill I feel at I'm hitting the gas or whipping around corners is awesome, and I get perhaps five people approaching me about how much they love my car each week, and I love talking cars so I enjoy the small talk.

I don't understand luxury SUVs and the like though. They don't perform all that well, aren't exciting to drive, and few people eye them and think much of them.
Who gives a crap what people think?
 
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In a similar vein I once got a good deal on a 3 year old Porsche with 11000 miles on it. Drove the crap out of it putting an additional 60000 miles on it over the next 3 years. Then a drunk driver ran into it and totaled it. My insurance company gave me $600o less than what I paid for it. Overall it was one of the cheapest cars I ever drove. Tires were the only big maintenance item. It was fun to drive and problem free.

What kind of Porsche was it? Just curious, have always wanted one.
 
Vehicles are like TVs. The next year model might have some new flashy badging... but overall the vehicle from 1-5 years ago is still a beast and just as good. Save your money and find something you want used.

2013 range rovers (new generation) are selling for 50% of what they were bought for.
They are beautiful vehicles and will cost you 50-60k vs 120k+

 
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Bought a slightly used vehicle with my sign on bonus 10+ years ago. 45k.
Just upgraded it last winter and enjoyed every mile I was in it.
Any 45k sign on jobs left in the States? :)
 
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If you haven't owned an L494 or the L405 or don't know what is in them then... :slap:
18k and only a couple of very small issues. But in case something goes wrong, I have 100k, 8 year bumper to bumper.
I love this ride. Capable on and off road, very well connected (apps, remote start LCD screens everywhere), exceptionally luxurious interior, bad ass styling and 200% fun as faak when you put it in dynamic mode. Soft door close, console fridge, auto access height, lots of little details that make this one special for me.

The V8 tuned to 650 HP is sick and a monster. But hey... haters will hate.
 
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If you haven't owned an L494 or the L405 or don't know what is in them then... :slap:
18k and only a couple of very small issues. But in case something goes wrong, I have 100k, 8 year bumper to bumper.
I love this ride. Capable on and off road, very well connected (apps, remote start LCD screens everywhere), exceptionally luxurious interior, bad ass styling and 200% fun as faak when you put it in dynamic mode. Soft door close, console fridge, auto access height, lots of little details that make this one special for me.

The V8 tuned to 650 HP is sick and a monster. But hey... haters will hate.

emqeJPn.jpg

What happened - Rover dealership run outta men’s cars?
 
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You think $42.7K after the federal tax credit (in most states, including a $1200 "destination & doc fee"), plus possibly a sales tax, is "not expensive at all", for a model with expected "average" (read bad) reliability (especially an unproven new model) with only 4 years/50K of warranty? This ain't Lexus.

Even driving 15,000 miles/year, at 130 mpg equivalent (versus 40+ for a Toyota/Lexus hybrid), the gas savings are 250 gallons/year, i.e. minuscule when compared to the cost of repairing (and probably insuring) such a car.


You can't compare a performance car like a Tesla with a Toyota or Lexus. I don't drive a Toyota/Lexus bc they are boring as fuk and drive like ass. You compare a Tesla to other comparable performance cars. If your priority is value and reliabilty, go with a Toyota and drive it into the dirt. Not everyone is like you or thinks like you. You're not more right than they are and they're not more right than you. How do you not understand this? I'm sure most would agree that great experiences are worth spending money to experience them. For many, driving a great car is an experience worth the money.
 
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Any advice on how to research and inspect a used car to make sure that you are not inheriting a bunch of problems that the previous owner may have created? I have actually never bought a used car since I became an attending out of fear of them being potentially unreliable but understand how much value you can get out of them if they’re in good shape.

I would love to get a Macan Turbo and realize that they are available for half the price with only 12-15,000 miles on them.
 
The Tesla Model 3 is not expensive at all right now, unless you go for the performance model which has the sub-4 sec 0-60. Especially when you consider the gas savings and incentives. And the standard version which will be released next year is very affordable. I'm blown away by how amazing this car is. Amazing acceleration, torque, handling, and range. And this is coming from someone who's last car was a 335i. Tesla has changed the game entirely. In 3-4 years, their cars will easily have 400-450 mile range
I wanted one. Then I read about how the harvest the cobalt.
 
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