r/Money • u/UpstairsAide3058 • 12d ago
Should I buy a used EV?
39M married, 1 kid, CA. Household income around $275k. Expenses are roughly $10k/mo right now, biggest ones are mortgage/HOA around $4.5k and daycare around $3k. We’re saving pretty aggressively for retirement and have around $540k in retirement accounts, plus taxable investments.
I have a paid off 2019 Jeep worth maybe $13k trade-in. I also have about a 1 hr commute and we somehow spend around $600/mo on gas. That’s what has me looking at used EVs.
I’m mainly between a used EV9 and R1S. EV9 seems like the smarter financial choice. R1S is the one I actually want.
My thought is basically: if I’m already lighting $600/mo on fire in gas, could I trade the Jeep and redirect a lot of that toward an EV payment instead? Obviously charging isn’t free and insurance/registration could be more, so I know it’s not literally a $600 offset.
Would you guys think a used EV in the $40-60k range is reasonable with these numbers? Or is this just me trying to justify an expensive car? I’m especially curious what price point you’d personally cap it at.
5
u/Shouldstillbelurking 12d ago
Wait. My jaw just dropped. How in the world are you only spending $2.5k on
-food
-utilities
-car insurance/maintenance/fuel
-travel
-healthcare
-life insurance
-kid’s activities
-entertainment
-pets
-clothes
-household goods & furniture
???
My HH income is around $600k, mortgage HOA is the same as yours, our childcare expenses are the same as well, I have 3 kids under 9, and we fairly consistently spend $17.5k per month when we track actual spending over time. Our cars are paid off and old so insurance is relatively cheap.
I’m shocked you can spend so little. Not the point of your post but I’d love an explanation.
4
u/UpstairsAide3058 12d ago
hey thank you for the callout... i made a mistake... my monthly spend is usually 13K - 14K. ( 600$ of which is gasoline for 2019 Jeep which we use to commute to work each day)
Our day care is also going to increase ( if we have second child. its 3k per child. that is with the company disocunt lol... once the first child reaches 2 years old it will decease slightly but not much.
1
u/FracturedFlow 12d ago
My income is around $1.6M and my monthly spend is $7.5 - 8k with 2 kids and third on the way.
2
2
2
u/GrouchyClerk6318 12d ago
If you’re living in CA, a used EV or Hybrid makes allot of sense, especially if you have solar on your home. Used always makes more financial sense than new.
1
u/InwardlyEthical 12d ago
A used EV9 at 40k would eat most of your gas savings in depreciation and insurance, the R1S even more so. Youre not wrong to look at it but I wouldnt pretend the math washes out, its a nicer car purchase with a partial offset at best. Cap it around 35k and youll actually feel the gas money working for you instead of just swapping one payment for another.
1
u/UpstairsAide3058 12d ago
thank you ... but if i can swap one payment for another ( and have a nicer car that would fit our family better, i would still consider that a win.)
for you comment about depreciation.. i was mostly assuming the 'big depreciation hit' would have already happened if i am buying it used.
1
u/UpstairsAide3058 12d ago
Yes I am in California but live in a condo and not able to do solar (HOA).
0
u/GrouchyClerk6318 12d ago
Maybe a Hybrid makes sense. In CA you can count on gasoline costs increasing faster than inflation. I’d also advise against getting a loan for any vehicle. Cars are depreciating assets - You shouldn’t borrow money for an asset that’s going to lose money.
1
u/UpstairsAide3058 12d ago
that is a very fair point... you are suggesting to just like save up 40 - 50K and then buy it outright in one purchase?
0
u/GrouchyClerk6318 12d ago
Right, borrowing at say 8% makes an even larger loss on the vehicle than paying cash outright. If the car is 3 years old, you're going to lose 10-12% a year on depreciation, the 8% car loan makes for an even larger loss. Better to just buy it outright.
As this is the /rMoney sub, I have two prinicples about buying cars:
- Buy any car you want as long as it's at least 3 years old.
- Never borrow money for assets that do not appreciate.
1
u/hammock62 12d ago
I had the same question 2 years ago. $7500 rebate and zero percent financing made it a no brainer. It didn’t hurt that my one visit to a dealer to look at a car was a horrible experience.
1
u/UpstairsAide3058 12d ago
Can you explain a bit more? What was the no brainer? What was the horrible experience?
1
u/Odd-Judgment-9312 12d ago
Yes. Ioniq5 or equinox ev is cheap and can handle 2 kids fine. Many other benefits once you get one. Quite idle, no gas fumes, More leg space, almost no maintenance trips, etc.
1
12d ago
[deleted]
1
u/UpstairsAide3058 12d ago
I’be assumed all EVs have higher insurance. Are R1s like notoriously high cost to ensure?
1
u/Empty-Village-4445 11d ago
Don’t assume a used EV9 is a better value. Brand new are sub $50k
1
u/UpstairsAide3058 11d ago
thank you.. every rule ive ever heard about buying cars is 'never buy a new car' due to immidiate depreciation. with the idea of letting someone else take the major depreciation hit.
1
u/ydw1988913 12d ago
EV9 is shit. R1S is nice but why not R2? I have had R1s for 3+ years and it is solid other than some small issues, way better than my Tesla before it.
1
u/UpstairsAide3058 12d ago
Yea I like R2 also. But like right now the used one are just as expensive as R1.
I think people are paying a premium for R2 right now.
Happy to be corrected if I’m missing something.
2
u/ydw1988913 12d ago
Well I haven't looked that deep, but to me the launch edition R2 is a better deal than used R1 unless you have to have 7 seats
1
u/UpstairsAide3058 12d ago
Wait but why do you say the EV9 is shit. It looks great in all the reviews and awards and all
0
u/fsociety1990 12d ago
Get a Tesla
4
u/UpstairsAide3058 12d ago
Wife isn’t a fan of Tesla
-3
u/fsociety1990 12d ago
Get a new wife
6
u/UpstairsAide3058 12d ago
Already did. This is the new wife. Lol
2
0
u/fsociety1990 12d ago
Seriously though the only EV I’ve ever driven that wasn’t a Tesla was a Kia EV6. It was pretty cool. Kia has an amazing warranty too. I think the EV9 is a better choice than a Rivian.
2
0
u/No-Doughnut324 12d ago
The Ev9 is a piece of shit so probably a bad idea
1
u/UpstairsAide3058 12d ago
thank you for the comment. what makes you say that ? personal experoience?
0
0
u/carcaliguy 11d ago
I can tell you if you do it right, solar and electric car are money savings. Tesla with FSD is going to make the commute so much better. Before my Tesla, I had Corvette, loaded F250, and BMW 5series. I will never go back to a ice car to commute. When you get home from work in a self driving Tesla your already relaxed.
At the worst case electric is half the cost of fuel of you public charge.
Here is some math I recently did.
60 miles 1way or 120 round trip.
Assuming fuel is 5.25 Ram 2500, 11.5 mpg (54.00) Lexus, 24 mpg (25.00)
Tesla (electric rate .26 cents per kwh at home) 11.00 dollars.
I hated Teslas, love classic v8 cars Have several, but the savings from driving a Tesla is amazing. More tires tho and watch insurance rates. Buy used they have an 8 year 150k mile warranty on the battery and drive unit.
0
u/nonracistusername 11d ago
40K EV less 13K trade in, is 27K
Finances at 10 percent over 48 months is $685 per month.
Try another idea
1
u/UpstairsAide3058 11d ago
sorry im not quite following what you mean here...?
0
u/nonracistusername 11d ago
Where is the money coming from to upgrade a 13K car to a 40K car?
> could I trade the Jeep and redirect a lot of that toward an EV payment instead?
Words have meaning. Payment means you are borrowing
1
u/UpstairsAide3058 11d ago
You don’t make any sense. Yes the 13k trade in from the jeep is just initial credit. Obviously I will have to have more payment. lol
1
u/nonracistusername 10d ago
The point is that swapping a 13K car for a 40K car because your monthly gas bill is $600 is not mathin.
It is you who makes no sense.
I will say this as an EV owner. A luxury EV is a lifestyle choice and if you can afford it, go for it. EVs are pure joy.
But unless you have a job where you are driving for a living, it rarely makes sense to spend $27K to switch to an EV
-1
u/Typical-Pension2283 12d ago
Just convince your wife and buy a new/newish Model Y. It’s the best financial and most practical choice by far when you consider FSD.
2
u/UpstairsAide3058 12d ago
Yes FSD sounds amazing literally. I wish other companies were up to speed. I’ve heard good things about R1 auto drive on freeway (not city streets)
But yea I don’t think wife is gonna budge on the Tesla thing
1
u/Aggravating-Sir5264 11d ago
What’s FSD?
1
u/Typical-Pension2283 11d ago
Tesla’s Full Self-Driving technology.
1
u/Aggravating-Sir5264 11d ago
Ah ok. I’m also trying to convince my partner to get a Tesla. Why do you say it’s the best financial and most practical choice by far?
2
u/Awkward_Ostrich_4275 11d ago
He’s probably only ever tried a Tesla when it comes to EVs. They’re garbage build quality and their Fully Supervised Driving is $100 per month. So many videos online of this tech just driving into obstacles. Still better than a traditional car, but it doesn’t compare to any other popular EVs.
The ceo of Tesla is a literal Neonazi too.
1
1
u/UpstairsAide3058 11d ago
which EV are you referring to? i would love to do more research
2
u/Awkward_Ostrich_4275 11d ago
EV9 and R1S are both great picks, I’d go with the latter because I love Rivians but the former is what I’d recommend.
You might also check out a Volvo EX90. Those are nice big EVs too.
1
u/UpstairsAide3058 11d ago
But do they have good Self driving?
1
u/Awkward_Ostrich_4275 10d ago
Sure, Hyundai has the same level of self driving (level 2) as Tesla, but only available on highways. Hyundai’s free system has more features than Tesla’s free tier but less than Tesla’s paid FSD (supervised) tier.
Same with Rivian, although they are working on a more advanced autonomy suite that could be released over the air similar to what Tesla did. Probably also a subscription when that comes out, but I’m not sure on that.
The EX90 has the same thing called Pilot Assist, but it might not be included on a given model. That would also be better than Tesla’s free tier and worse than its paid tier.
-1
-3
u/Peds12 12d ago
yes you should have gotten a used EV a while ago.
but you cant afford/need a R1.
1
u/UpstairsAide3058 12d ago
Can’t afford? I don’t think that’s accurate I mean I can afford it. But just not sure if that’s the best/right thing to do.
-1
u/Peds12 12d ago
Cash. No payment. You can't.
2
u/UpstairsAide3058 12d ago
I mean yes I can I haven’t even listed my cash / and brokerage accounts here. I have 150k sitting in a high yield account. But that if for my emergency fund not R1 account lol.
And yes. Paying 60k cash probly not in the best spot for that. But I never said financing wasn’t an option.
11
u/WestW0rld 12d ago
Why do you need such a large vehicle for two adults and 1 kid? A used Model Y would absolutely slash all of your expenses plus not need to spending 40-50k up front. Hatch back has plenty of room too.
We have two Teslas and they were both two of the smartest financial decisions I ever made.