How I bought a Tesla for $78 Per Month

I just bought the $35,000 Tesla Model 3, and just like any 28-year-old millennial adieu, I ordered it online without ever having seen it and without ever having driven one before.

Here's what happened: I was browsing YouTube and happened to come across a video announcing the arrival of Tesla's $35,000 Model 3. As I was watching that video, I opened up a second tab in my browser just a spec went out for fun. I honestly had zero intention of ever buying one; it's just a guilty hobby of mine to go to car websites and spec out brand new cars just to see how expensive they would be.

So I went on Tesla's website and got to work. The standard range Model 3 begins at their promised price of $35,000. But I quickly realized that if you increase your budget just a modest $2,000, you'll get an extra 20 miles of range, a slightly higher top speed, power-adjusted seats, premium interior, and upgraded audio, which honestly seems like a decent value.

Then we get to colors. If you get any other color besides black, it'll cost you up to $2,500 more if you want rent. Now, I'm all about saving money as we all know, so we're going with black today. Next, do they give you the option to upgrade to 19-inch wheels for an extra $1,500? Nope, that's not gonna happen.

Now we have the choice of interior color, either black or white, but white is an extra $1,000, and I would be worried about getting that dirty, so black it is. Finally, we have autopilot for an additional $3,000. The car will stay in its own lane and keep pace with traffic; a must-have for anyone lazy like me. They also offer full self-driving capability for an extra $5,000. This includes navigating highways, summoning your car, and a few other technologically amazing feats. But for $5,000, I think I could just do that myself.

So now, within just a few minutes, in less time than it takes to make a bag of popcorn in the microwave, I was done configuring a Tesla Model 3. However, it should come as no surprise that the $35,000 Model 3 is not really a $35,000 Model 3. My just-for-fun spec car, with very few options, came to a whopping $40,000. Classic bait-and-switch, am I right? Well, kind of.

Even though the car is technically a $40,000 car, it's hard not to focus on the number at the bottom of the screen where it says price after estimated savings. So how does a $40,000 car come down to a price of twenty-nine thousand four hundred and fifty dollars? Well, to start, this car is eligible for a three thousand seven hundred and fifty dollar federal tax credit until June 30th, 2019. This means if you pay more than that in federal taxes, you will receive this entire amount back at the time you file your tax return. That money is pretty much as good as cash.

California drivers are also eligible for a twenty-five hundred dollar electric vehicle rebate, in which the state will literally mail you a check back for twenty-five hundred dollars upon showing proof of purchase. Now, Tesla gets a little bit sneaky after this because in that twenty-nine thousand four hundred and fifty dollar figure, Tesla also includes the estimated gas savings over six years of ownership, which comes to about forty-three hundred dollars.

Now from my perspective, this would apply to any electric car you purchase, not just Tesla. So this is really only comparable if the buyer was to otherwise buy a gas-powered car. So excluding the gas savings and only focusing on the first two cash value rebates, the actual price of the car comes to thirty-three thousand seven hundred and fifty dollars for a brand new Tesla standard range plus with autopilot.

Now, maybe I'm just impulsive, maybe I'm delusional, but it was honestly at this point that I just figured, you know what? Why not? That's a pretty good deal. I'm just gonna go ahead and buy it. So I did. I even got a picture of a lemur! Once I placed the order, and I have to say, coming from someone who's purchased several cars before, this was by far the easiest car buying experience I have ever had in my entire life.

There was no driving around, spending hours at car dealerships. I didn't have to pretend like I was disinterested just so I could spend days negotiating the price down. There weren't any dealership upsells. I didn't have to receive random calls from car salesmen calling me every few days to follow up if I had found something yet. No, Tesla was different. It was as easy as clicking buy it now on Amazon, and it was amazing!

Now, I had originally intended to purchase the car outright in cash, but I couldn't help but notice their offer soon after I placed my deposit: 100% financing for 72 months at a 3.75 percent interest rate. That's low. At that interest rate, I'd get a better return investing my money literally anywhere else instead of buying the car in cash.

So just like the car, I figured, you know what? Why not? I'm going to do it. And I applied for financing. Ten hours later, I was approved! This means that my total out-of-pocket cost to buy a brand new Tesla Model 3 was four thousand four hundred and thirty-seven dollars and one cent, which included sales tax, the license fee, and registration—that was it!

And now with that out of the way, I couldn't help but wonder: could they actually fulfill their promise delivery time of two weeks? So now it's officially one week after placing the order, with absolutely zero update whatsoever from Tesla. I feel like a kid logging in every single day to the Tesla account just to see if there's any update that's been posted, but there's never any update.

Looking online for answers really isn't much better either because no one else has any clue what's going on, and no one has any idea how long this can actually take. Some people are quoting an Elon Musk tweet saying that the cars will actually be ready in June and not March, and some people doubt his ability to actually just make a decent car. So the sentiment isn't really looking good right now, but I will keep you posted.

So now it's officially 14 days since placing the order, and I just logged online and saw that they changed the new delivery date to March 29th. This is exactly one month after placing the order and two weeks longer than they expected it to take. To me, I definitely feel like Tesla overestimated just how fast they can get these cars out here to try to get people to order them, who would think that they don't get their cars a lot faster than they really will.

And I mean, I can't totally blame Tesla for this because it worked. It's kind of like telling someone you're five minutes away when in reality you're ten minutes away, and then after that person's already waited five minutes for you, what's another fine minutes? So the same thing could absolutely be said about ordering a Tesla.

This is the 2019 Tesla Model 3, and today is my first day owning the car. We're gonna be going over all the quirks and features, and then we're gonna give it a grand score. I've always wanted to say that! But no, in all seriousness, today is my first day of getting the car, and I have to say that I absolutely love it.

And of course, when I was looking online, I read a lot of issues about panel gaps and poor paint jobs and scratches everywhere. I couldn't find a single thing wrong with this car. My only issue with this, if there is anything, is that you have to slam the driver's side door for it to properly close. If you don't give it a good slam, it's not going to close all the way. I’m not sure if that's just a Tesla thing or if that's just my specific car, but other than that, this car personally is perfect.

And of course, just as a friendly reminder, if you haven't already smashed that like button yet, make sure to do so; otherwise, you're gonna get Leagued. Honestly, the entire process of going and picking up a Tesla was amazing. It was like walking into a high-tech, minimalistic Apple store where there must have been two employees for every one customer.

So anything you would need was pretty much attended to immediately. After going through the experience of buying a Tesla online, completely sight unseen, without ever having driven one before, I honestly have to say that I don't see the concern of Tesla not having any physical car dealerships to buy cars from. I just think we're naturally entering an era where everything is done online.

Like, I haven't been to a physical store to buy anything in ages, just because it's a lot easier and more convenient to go and buy that item online. Also, the online stores tend to be a lot cheaper because those stores have less overhead, and they pass that savings on to the customer.

And sure, this online ordering method isn't for everybody. I think my parents still love going to physical stores and like going to an actual bank to deposit a check. But I also think we just instinctually prefer what we're accustomed to and what we find normal that we grew up with.

I think for a lot of people who grew up with the internet, it's just going to seem normal to go and start to buy cars and maybe eventually buy houses just online. So you might be wondering now: how did I get this car for $78.39 per month? Well, here's how.

Now because I financed 100% of the car, my only out-of-pocket cost was taxes, insurance, and registration, and that came to four thousand four hundred and thirty-seven dollars and one cent. Now because I financed the cost of the car, this means I now have a monthly car payment to make. This car payment is six hundred and forty dollars per month, which works out to be seven thousand six hundred and eighty dollars per year.

This means that my total cost to buy this car in the first year, including monthly payments, taxes, license, and registration, comes to twelve thousand one hundred and seventeen dollars and one cent. However, even though I've paid that amount out-of-pocket, I will get back twenty-five hundred dollars from California's EV rebate program.

I'll get back another three thousand seven hundred and eighty dollars from the federal tax credit, which remember is all money that I get back. That brings down my total cost of ownership in the first year to five thousand eight hundred and sixty-seven dollars and one cent.

But wait, there's more! It gets even better because I bought this car specifically for business use, which means the fourteen hundred and thirty-eight dollars in interest that I pay financing the car is a tax write-off. I also get to write off the four thousand four hundred and thirty-seven dollars in taxes, licensing, and registration as a tax write-off.

I can also depreciate the value of the car by about eight thousand two hundred dollars in the first year. All of that combined works out to be about a fourteen thousand dollar tax write-off, which should save me about four thousand nine hundred and twenty-five dollars in taxes.

So remember, like I said, my total out-of-pocket costs to buy this car in the first year is five thousand eight hundred and sixty-seven dollars and one cent. Plus, on top of that, like I said, I'm saving four thousand nine hundred and twenty-six dollars on my taxes.

Which means that when you reduce that from the total amount and you divide that over a year, it's effectively like I'm buying a brand new Tesla Model 3 for the out-of-pocket cost of seventy-eight dollars and thirty-nine cents per month.

And realistically, this works out to be a free car when you consider that most of that six hundred and forty-dollar-a-month car payment is principal; it's not interest. Also, the fact that I'm leveraging my money by borrowing it at 3.75 percent to go and invest it elsewhere that will actually make me more money than paying down the car in full in cash.

But now, in terms of actual out-of-pocket net cost to own the car: seventy-eight dollars and thirty-nine cents per month for a Tesla Model 3, brand-new. So here's a fun little thing right now: my dad has no idea that I got the car, and I'm just gonna go and show up and surprise him with it.

I just told him right now that, like, “Hey, I’m close by, let me just stop by really quick.” He probably thinks it's a little out of character for me just to be showing up randomly. But anyway, let's see what his reaction’s going to be!

[Music]

"Come on, man! Gram, a freaking Tesla, dude? Told ya!"

"This is incredible!"

[Music]

"Take me for a ride now, dude! I won't put your seat belt, Gram!"

"Yeah, it's that one of the best choices you've ever made!"

"Right now, holy crap! Yeah, I didn't; anyways, look at this!"

"Oh, is this amazing? Do it! Oh, that is just like you like! Huh?"

"I love the color, Gram! Oh my god! Oh, is this the S?"

"No, no, the small three—nice, brand new Model 3!"

"Oh wow, great! That's cool!"

"Yeah, right here."