Are you one of those people who drool over the new Tesla models but can’t seem to afford one? Well, you’re in luck. This article will give you some tips on how to afford that Tesla. So, how much do you need to make to afford a tesla?
You will probably need to make a six-figure annual salary to afford a Tesla. On average, you should budget at least $1,000 a month to repay a Tesla loan. If you have savings for a down payment, your monthly payment will be less. There are also other factors to consider, like which model you want to buy and which add-ons you want to include.
In this article, I explain the different factors you need to consider when deciding whether or not you can afford a Tesla. I will have a look at each model individually. This will help you make a responsible decision about buying a Tesla.
The information provided in this blog post is for general informational purposes only and does not constitute financial advice. I am not a financial advisor, and the content written here is based on my personal research and experience. While I strive to provide accurate and up-to-date information, the financial landscape and regulations may change, and individual circumstances vary. Therefore, it is important to consult with a qualified financial professional or advisor before making any financial decisions or taking actions based on the information presented in this article.
I do not assume any liability for the outcomes or consequences of using the information provided in this blog post. Any reliance you place on the information provided is at your own risk. I strongly encourage you to conduct your own research and seek professional advice specific to your financial situation and goals. Remember that financial decisions should be made after careful consideration and analysis of your personal circumstances.
- Exploring 4 Financing Options For Affording a Tesla
- Can I Lease a Tesla?
- How Much You Have To Make To Afford and Own a Tesla
- Tesla Price Range and Variations Among Models
- How to Afford a Tesla Model 3
- How to Afford a Tesla Model Y
- How to Afford a Tesla Model S
- How to Afford a Tesla Model X
- Other Expenses related to buying a Tesla
- Ways to Improve Creditworthiness for a Tesla Loan
- Maximizing Income and Finances to Afford a Tesla: 4 Tips.
- Taking Advantage of Government Incentives to Lower the Cost of a Tesla
- 4 Other Factors to Consider When Affording a Tesla
- 3 Other Options To Consider When You Cannot Afford a Tesla
- Buying a Used Tesla
- How People Afford Teslas
- How To Budget for a Tesla: 4 Steps
- Cheapest Tesla Model
- Credit score needed to Buy a Tesla
- How to Afford a Tesla Model 3 with $12.00 an Hour
- The Average Income of a Tesla Owner
- How the Average Person can Afford a Tesla
- What is the Warranty Coverage Offered by Tesla, and What Does it Include?
- How to Order a Tesla
- How Long Does it Take to Get a Tesla After Ordering?
- How To Afford a Tesla as a Teenager
Exploring 4 Financing Options For Affording a Tesla
When it comes to purchasing a Tesla, there are a few financing options to consider. These are explained in more detail below.
1. Cash payment
Buying a Tesla cash will be the cheapest option because you do not have to pay interest. However, very few people have that kind of money lying around.
2. A loan from a traditional lender
One option is to secure a loan from a traditional lender, such as a bank or credit union. It’s important to carefully review the loan terms, including the interest rate and length of the loan, to determine the best option for your financial situation.
How much is a Tesla payment?
The cost of a Tesla payment can vary depending on several factors, including the model, loan terms, down payment, and credit score.
If you choose to finance your Tesla purchase, you can expect to make monthly payments ranging from a few hundred dollars to over a thousand dollars. Values for specific models are given further on in this post.
3. A loan from Tesla directly
You can apply for a car loan directly through the Tesla website.
Does Tesla Finance Cars?
Finance LLC, a subsidiary of Tesla, offers financing options for those who want to own a Tesla without breaking the bank.
With Tesla financing, you can choose the length of your loan term, your down payment, and your interest rate to make your monthly payments more manageable. Financing a Tesla is a great way to make owning an affordable Tesla possible.
4. Working with a Financial Advisor
You can consider working with a financial advisor to explore other options, such as a down payment or investing in Tesla stock.
Can I Lease a Tesla?
Tesla offers qualifying customers to lease a Tesla. If you’re looking to add a touch of luxury to your life without committing to a long-term purchase, this might be an option worth considering.
This is a more affordable option, but remember that you don’t own the Tesla at the end of the lease period. You will have to return it.
Leasing a Tesla offers the advantage of not having to worry about resale value, as you’ll simply return the car at the end of the lease.
How Much Does It Cost To Lease A Tesla?
The table below shows the estimated monthly cost of leasing a Tesla. The term for this example is 36 months and the agreement allows 10,000 annual miles.
|Tesla Model||Down payment||Estimated Lease Payment per month|
It’s also important to consider the overall cost of purchasing a Tesla. The price tag can be significant, especially for newer models. In addition to the initial cost, there are also ongoing expenses to consider, such as average monthly payments, annual subscription fees, and the cost of insurance and regular maintenance.
While electric vehicles may save money on gas in the long run, it’s still important to carefully budget for the total cost of ownership.
For those who are considering a used Tesla, it’s worth considering the savings that can come with purchasing a pre-owned vehicle. While the initial cost may be lower, it’s still important to consider the long-term expenses, such as the cost of repairs and maintenance.
On the other hand, purchasing a new Tesla may come with certain perks, such as the peace of mind that comes with a new car and the opportunity to take advantage of government incentives, such as tax credits.
How Much You Have To Make To Afford and Own a Tesla
The yearly salary you need to be able to afford a Tesla is, in most cases, at least $85,00. This is if you are buying the electric vehicle on a loan. The exact income depends on the model you’re looking at and whether you intend to pay cash or take a loan.
It is recommended that you spend no more than 10% of your monthly take-home salary on a car payment. In addition, you should spend no more than 15% to 20% on total car costs , so the payment plus maintenance, insurance, etc.
It is impossible to give a set minimum annual salary you need to make to afford a Tesla. There are simply too many factors that need to be considered.
However, the following examples can help to clarify the situation.
Annual Salary Needed to Buy a Tesla on a Loan
Let’s say you want to buy a base model Tesla Model 3. The cost is $40,240 and you want to take out a loan to pay for it.
If you pay a 10% down payment ($4,024), the sales tax is 5% and your interest rate for the loan is 9.89%, you will have to pay a monthly payment of $706 for 72 months (6 years).
If this monthly payment makes up 10% of your monthly take-home salary, you would have to earn $7,060 per month.
This is an annual take-home salary of $84,729.
Annual Salary Needed to Buy a Tesla Cash
If you want to pay cash, it is advised that you make at least double the cost of the Tesla model you’re looking at in one year. This is to ensure that you still have enough money for your other expenses.
So, for a Model 3, which sells for $40,240 (base model), you need to make at least $80,000 a year if you intend to pay cash.
Tesla Price Range and Variations Among Models
The price range and variations among Tesla models can be quite diverse, making it important to carefully consider your options before making a purchase.
How Much Does a Tesla Car Cost?
The most affordable Tesla model is the Model 3, which starts at around $40,000. The Model Y base model costs $47,490. If you’re looking for something more luxurious and spacious, the Model S and Model X can cost upwards of $100,000.
There are also a number of extras you can add to your vehicle at an additional cost, increasing the prices further:
- the type of motor (dual motor or tri motor)
- The Model 3 and Model Y can also be purchased as Long Range or Performance versions
- Paint color (Pearl White Multi-Coat is included, the other colors have an additional charge)
- The type of wheels (Sport Wheels cost more)
- The color of the interior (black is included, white and cream have an additional cost)
- Enhanced Autopilot costs $6000 more
- Full Self-Driving Capability costs $15,000 more
- A charger (wall connector or mobile connector)
Below is a table showing the cost of various Tesla models, recommended yearly income to afford one in cash, the yearly income to afford a six-year loan, and the expected monthly payments over the loan period.
|Model||Cost for Base Model||Approximate Recommended Yearly Income For Cash Payment||Recommended Yearly Income for a Six-Year Loan||Expected Monthly Payments for a Six-Year Loan|
Note that the table above assumes that you make a down payment of 10% when buying your Tesla. It also assumes an interest rate of 9.89%.
How to Afford a Tesla Model 3
A base model Tesla Model 3 costs $40,240.
If you’re looking to afford a Tesla Model 3, there are a few tips and strategies that can help. First, consider financing through a loan. Tesla offers its own financing options through Tesla Financing LLC, allowing you to make monthly payments instead of paying upfront.
If you want to buy a Tesla Model 3 base model on a loan, you can expect to pay around $700 per month over 6 years. The more additional extras you add to your electric vehicle, the more this payment will be.
If your car payment makes up the recommended 10% of your monthly take-home salary, you’ll have to earn at least $84,729 per year to afford this.
You can make the option even more affordable by shopping around for lower interest rates or saving to pay a larger down payment.
Keep in mind that these costs do not factor in maintenance and insurance.
How to Afford a Tesla Model Y
A base model Tesla Model Y costs $47,490.
Financing a Tesla Model Y is a great way to make your dream a reality, and with Tesla Finance LLC, you can find financing options that work for you.
To start, you’ll want to explore your financing options. Tesla Finance LLC offers financing for both new and used Tesla vehicles, with loan terms ranging from 36 to 72 months. You can apply online or in-person at a Tesla showroom, and once approved, you can customize your loan terms to fit your budget.
If you want to buy a Tesla Model 3 base model on a loan, you can expect to pay around $833 per month over 6 years (excluding maintenance and insurance). The more additional extras you add to your electric vehicle, the more this payment will be.
If your car payment makes up the recommended 10% of your monthly take-home salary, you’ll have to earn at least $99,960 per year to afford this.
Whether you want a lower monthly payment or a shorter loan term, Tesla Finance LLC can help you find the right financing option for your needs. So don’t let the sticker price of a Tesla Model Y deter you from owning one – with the right financing, that dream can become a reality.
How to Afford a Tesla Model S
A base model Tesla Model S costs $88,490.
If you want to buy a Tesla Model 3 base model on a loan, you can expect to pay around $1,553 per month over 6 years (excluding maintenance and insurance). The more additional extras you add to your electric vehicle, the more this payment will be.
If your car payment makes up the recommended 10% of your monthly take-home salary, you’ll have to earn at least $186,360 per year to afford this.
With its sleek design and advanced features, the Model S is a dream car for many Tesla enthusiasts. But how can you make it a reality?
One option is to finance a Tesla Model S through a loan from Tesla Finance LLC. This company offers financing options for both new and used Tesla vehicles.
Additionally, Tesla partners with big banks like Wells Fargo and US Bank for financing, which may offer more favorable terms and interest rates. To apply for financing, you can visit Tesla’s website and fill out an application.
Keep in mind that your credit score and income will play a role in determining your eligibility for financing.
How to Afford a Tesla Model X
Want to add a touch of luxury to your life? Let’s explore the ways to make owning a Tesla Model X a reality.
A base model Tesla Model Y costs $98,490.
If you want to buy a Tesla Model 3 base model on a loan, you can expect to pay around $1,728 per month over 6 years (excluding maintenance and insurance). The more additional extras you add to your electric vehicle, the more this payment will be.
If your car payment makes up the recommended 10% of your monthly take-home salary, you’ll have to earn at least $207,360 per year to afford this.
The first step is to research the various financing options available through Tesla Finance LLC. They offer a range of financing plans including leasing, loans, and cash purchases.
Leasing a Tesla Model X can be a great option for those who want to keep their monthly payments low and trade in their vehicle every few years.
Tesla also offers competitive financing rates for those who want to purchase their Model X outright.
Other Expenses related to buying a Tesla
You might see the above figures and feel that your finances will allow you to purchase a Tesla right now. However, there are a few more costs you need to consider before jumping in and ordering your electric vehicle.
How much is Auto Insurance for a Tesla?
If you’re considering buying a Tesla, you may be wondering how much auto insurance will cost for such a high-end vehicle. Auto insurance rates for Teslas are usually a little higher than rates for other luxury vehicles.
There are a few factors that can impact your insurance premiums.
First, the model of Tesla you choose will affect your rates. More expensive models like the Model S and Model X will generally cost more to insure than the more affordable Model 3.
Additionally, your driving record, age, and location can also impact your rates.
According to NerdWallet, annual insurance for a Tesla can range from $2,000 for the cheaper models to $3,000 for the more expensive models. This means an added monthly expense of between $166 and $250. This can have a significant effect on your budget!
Be sure to shop around and compare rates from multiple insurance providers to ensure you’re getting the best deal possible while also financing your Tesla.
Planning for Tesla Maintenance and Operating Costs
While electric cars typically require less maintenance than gasoline vehicles, Tesla’s unique technology may require more specialized attention.
Additionally, it’s important to compare maintenance costs with traditional gasoline vehicles to determine if the initial investment is worth the long-term savings.
You should also consider charging costs and the availability of charging infrastructure, as well as factoring in insurance premiums and potential savings.
Understanding maintenance needs for Tesla vehicles
Maintaining a Tesla car is a crucial aspect of owning one, and it’s important to factor in these costs when considering the overall investment.
While Teslas require less maintenance than traditional gasoline cars, they still need routine upkeep and occasional repairs. Tesla recommends annual service inspections, which can cost around $600.
Additionally, tire rotations, brake replacements, and battery replacements are all potential expenses that should be budgeted for.
Comparing maintenance costs with traditional gasoline vehicles
While Tesla vehicles may have a higher upfront cost, their maintenance costs are generally lower than traditional gasoline vehicles. This is because Tesla vehicles have fewer moving parts and require less maintenance overall.
Additionally, Tesla offers a four-year/50,000-mile basic warranty and an eight-year/120,000-mile battery and drivetrain warranty, which can provide peace of mind and potentially save you money on unexpected repairs.
When comparing maintenance costs, it’s important to factor in the potential savings on gas and oil changes with a Tesla, as well as the potential for tax credits and incentives for purchasing an electric vehicle.
Charging Costs and Availability of Charging Infrastructure
Tesla has made charging their vehicles easy and convenient with their extensive charging infrastructure. With over 20,000 Superchargers and Destination Chargers worldwide, Tesla has built a network that allows you to charge your car on the go.
The cost of charging your Tesla car at a Supercharger varies depending on your location and the time of day, but it typically ranges from $0.28 to $0.32 per kWh.
To put this into perspective, if you have a Model S with a 100 kWh battery and you charge it from 0 to 100%, it would cost around $28 to $32.
Charging your car at home is even cheaper, but obviously you need to have the right charging equipment.
Ways to Improve Creditworthiness for a Tesla Loan
If you’re looking to secure a loan to purchase a Tesla, it’s important to have good credit. This can help you qualify for a lower interest rate, which can ultimately save you a significant amount of money over the life of the loan.
There are a few steps you can take to improve your creditworthiness and increase your chances of getting a good deal on a Tesla loan.
1. Paying Bills on Time
One of the best ways to improve your credit score is to pay all of your bills on time. This includes credit card bills, mortgage payments, and any other debts you may have.
2. Paying Credit Card Debt
It’s also a good idea to pay off as much of your credit card debt as possible, as high balances can hurt your credit score.
3. Checking Your Credit Report
Another tip is to check your credit report for errors and dispute any inaccuracies you find.
4. Working with a Financial Advisor or Credit Union
Consider working with a financial advisor or credit union, as they may be able to help you find the best loan options for your financial situation.
How Can I Get a Good Interest Rate for my Tesla?
In addition to taking steps to improve your credit score, it’s also important to shop around for the best loan offers.
This can help you find a lender that is willing to offer you a competitive interest rate.
It’s also worth considering the length of the loan, as a shorter loan term may come with a higher interest rate but ultimately cost less in the long run.
Maximizing Income and Finances to Afford a Tesla: 4 Tips.
When it comes to affording a Tesla, it’s important to make the most of your income and finances. You have to know what’s going on with your money to avoid making irresponsible purchases.
1. Increase your income
One way to maximize your finances is by finding ways to increase your income, such as taking on a side hustle or negotiating a raise at your current job.
2. Track your expenses
It’s also a good idea to carefully track your expenses and look for areas where you can cut back in order to free up more money for a down payment or monthly loan payments.
3. Consider opportunity costs
Another way to maximize your finances is to carefully consider the opportunity costs of purchasing a Tesla. For example, buying a Tesla may mean sacrificing other purchases or investments that you might have made.
It’s important to weigh the benefits of owning a Tesla against the other options that may be available to you.
4. Ask for help
Don’t be afraid to ask for help when it comes to affording a Tesla. A financial advisor or credit union can be a valuable resource for finding the best loan options and developing a budget that works for your financial situation.
In a post I read recently, someone said that it’s also worth considering whether you have any friends or family members who might be willing to help with the down payment or monthly loan payments.
After all, every little bit can help when it comes to making your dream of owning a Tesla a reality. However, I don’t recommend this if you don’t have a good, healthy relationship with these friends or family members.
Taking Advantage of Government Incentives to Lower the Cost of a Tesla
One way to lower the cost of a Tesla is to take advantage of government incentives that are available in your area. In the United States, for example, the federal government offers a tax credit for electric vehicles, including Teslas.
This credit can significantly reduce the amount of money you owe in taxes and make it more affordable to purchase a Tesla.
In addition to the federal tax credit, some states also offer their own incentives for electric vehicles.
For example, some states offer rebates or grants to encourage the purchase of electric vehicles. It’s worth checking with your state’s department of transportation or energy to see what incentives are available in your area.
You can find out more about state-specific incentives on the Tesla website.
It’s also worth noting that the availability and amount of these incentives can vary by state and may change over time. It’s a good idea to stay up to date on any changes to government incentives and to consider them as part of your overall budget when purchasing a Tesla.
By taking advantage of these incentives, you can potentially save a significant amount of money on the cost of your electric vehicle.
4 Other Factors to Consider When Affording a Tesla
In addition to financing options, cost, creditworthiness, and government incentives, there are a few other factors to consider when it comes to affording a Tesla.
1. Book a Test Drive
You should consider the availability of test drives and service centers in your area.
It’s a good idea to test drive a Tesla before committing to a purchase to make sure it’s the right car for you, and it’s also important to have access to service centers for any repairs or maintenance that may be needed.
2. The Stock Market
Another factor to consider is the stock market. If you’re considering purchasing Tesla stock as a way to finance your Tesla, it’s important to keep an eye on the market and the performance of the company.
It’s also worth considering the general economic climate and any potential risks or uncertainties that may affect your financial situation.
You can also consider a trade in when wanting to purchase a new Tesla.
Does Tesla take Trade Ins?
Did you know that when it comes to upgrading to a new Tesla, you don’t necessarily have to pay the full price outright? Tesla accepts trade-ins, which can help make the process of affording and financing a new model much more convenient.
By trading in your old car, you can use its value towards the purchase of your new Tesla, which can significantly reduce the overall cost. Not only does trading in your old car help with the cost, but it also saves you the hassle of trying to sell it yourself.
Tesla makes the process simple and straightforward by providing an online trade-in calculator that estimates the value of your car based on various factors such as the make, model, and condition.
4. Your personal finances
Finally, it’s important to think about your personal finances and whether you are comfortable taking on the financial responsibility of owning a Tesla. This includes considering your budget and whether you have enough income or savings to cover the cost of a Tesla.
It’s also a good idea to think about any other debts or financial obligations you may have and whether it makes sense to take on a new car loan at this time.
By carefully considering all of these factors, you can make an informed decision about whether owning a Tesla is a good fit for your financial situation.
3 Other Options To Consider When You Cannot Afford a Tesla
While a Tesla may be your dream car, it’s important to consider other options as well.
1. Is an EV the right car for you?
Electric vehicles, such as the Tesla, are generally more expensive than gas-powered cars, so it’s worth considering whether a traditional car might be a more affordable option for you.
2. Other electric vehicle brands
Finally, don’t forget to consider other brands and models in addition to Tesla. While Teslas are known for their high-tech features and performance, there are many other options on the market that may be more affordable and still meet your needs.
By considering a range of car options, you can make an informed decision about the best fit for your budget and driving needs.
3. Secondhand Teslas
It’s also worth considering used cars, as they can be significantly less expensive than new ones. When purchasing a used car, it’s important to carefully research the model and consider factors such as the car’s age, mileage, and overall condition.
It’s also a good idea to have a mechanic inspect the car before making a purchase.
Buying a Used Tesla
It’s smart to buy a used Tesla if you can get a good price on lower mileage options that are still within their warranty period. High-mileage Teslas may present problems that’ll end up costing more money than you’d spend on a brand-new model.
People choose to buy used Teslas because it can help them avoid the wait times between pre-order and delivery. You may look at potential savings on the cost of a new car as a valid reason, but that isn’t always the case.
Pro Tip: What can you do if basic functions do not work after your Tesla delivery?
If you take delivery of your Tesla for the first time, you might find that some features like “Cabin Overheat Protection“, “Dashcam Save Footage Button” and “Honk to Save Footage” are not working. The most likely case is that your new Tesla will not have been flagged as delivered on Tesla’s backend database. Ask your Tesla rep to contact your local delivery center to repush the delivered status of your car on both the old- and new system. This will sort out your issue and you’ll be greeted with a welcome screen when you get back into your car again.
Some used Tesla owners put their cars on the market at almost the same price as a new one or slightly higher.
However, if you find a good deal, it’s worth exploring. Some benefits of buying a used Tesla include the following:
- You can get a world-class electric vehicle right away. Tesla remains the leading product in the electrical vehicles niche. If you want one immediately, checking out the used market is a smart idea. You’ll get your dream car in days instead of waiting weeks. The looks of the average Tesla also mean it’s hard to differentiate between a neatly used and brand new car if they both drive down your street, so you’re not missing much.
- You can get lower monthly repayment. If you get your used car at a price cheaper than a new one with a loan, you’re sure to get lower monthly repayments. So instead of spending $900+ on your car monthly, you may end up paying around $500.
- You can get a color that is no longer available. Teslas are currently only available to order new in five colors. Some colors, like the green, brown and Obsidian Black Metallic have been discontinued. Buying older Teslas secondhand might make these options available to you.
Still, as with all other vehicles, buying a used Tesla isn’t without its risks. First, you need to find one with a reasonable price and ensure that its battery degradation is less than 5%.
It’s not always easy to find that combination. When you do find it, you may have to live with upgrades or modifications the original owner has made, which are irrelevant to you and may cost you more money on maintenance.
You also have to trust that the owner has been honest about their use of the vehicle.
So, while it makes sense to explore the used Tesla market, you need to be careful to ensure you’re not going to end up spending more money than you’d have spent if you waited a few months for a new car to arrive.
How People Afford Teslas
For most people, buying a Tesla is a financial stretch. The luxury electric car has a starting price of $35,000, and can cost more than twice that after options and upgrades. So how do people manage to buy them?
There are a few ways. Some people finance their purchase with a loan, spreading the cost of the car over several years. Others lease their Tesla, making smaller monthly payments instead of one large upfront payment. And some people simply save up enough money to pay for their Tesla in cash.
No matter how you finance your Tesla, it’s important to do your research and make sure you can afford the car before you commit to buying it. Otherwise, you may find yourself struggling to make your payments and end up defaulting on your loan or lease.
How To Budget for a Tesla: 4 Steps
Like most big-money purchases, you have to budget for a Tesla if you’re an average income earner. Here’s how you can do that:
1. Decide on the Model You’d Like To Go For
The first step to budgeting for a Tesla is to have a model in mind. They’re all wonderful cars, so it’s not always easy to choose. However, looking at the table above, you can quickly eliminate models that aren’t realistic for your income level and focus on those you’re most likely to afford.
Pay attention to any extras you’d like to add to come up with a defined budget. At this stage, you should also decide if you’d like to pay in full or go with a car loan. Your budget and timeline will vary based on which side of the divide you choose to lean towards.
2. Calculate the Initial and Ongoing Costs
When you’ve chosen a model and all the whistles and bells you’d like to add to it, you can go to the Tesla website to get a definitive cost for everything. As you add any extras, you can see the model’s price reflects any changes in real time.
Once you’ve concluded the purchase-related calculations and arrived at a number, you’ll need to calculate ongoing costs like car insurance, registration, maintenance fees, the interest rate on the loan, etc. Don’t forget to include the down payment in your calculations if you’re going for a loan.
3. Decrease Your Expenses or Increase Your Income
When budgeting and saving for your Tesla, you can either make more money or reduce your expenses and put the saved money away toward your goal. If you’re saving money, look for vehicles that can at least keep pace with inflation.
You should also watch out for options that can grow your money without exposing you to excessive risk.
If you’re looking for how to save money, you can use apps and online tools that can help you plug wastage and those that will help you find cheaper alternatives to things you usually pay for.
Here’s a YouTube video that goes into more detail on how you can save money on your Tesla budget.
Cheapest Tesla Model
The cheapest Tesla model is the Tesla Model 3. The base variant costs $43,990 currently for outright purchase. On loan, the monthly repayment over a six-year term works out at $721 per month.
However, the Tesla Model 3 can cost up to $60,000 if you choose to change the base design.
For example, adding full self-driving functionality to the vehicle can increase the price by $10,000.
Credit score needed to Buy a Tesla
Tesla doesn’t require a minimum credit score for people looking to buy a model with a loan. However, if you have a good to excellent credit score (minimum 720), you can qualify for a lower-APR loan.
Tesla’s financing rates begin at 2.49% APR for a 3-6 years loan term. The exact loan conditions are determined by your credit rating, the model you’ve chosen, and the financing term.
You can check your credit score on the USA.gov website.
When looking for financing for your Tesla, don’t forget to check offers from your credit union, bank, and other online lenders. They may have more flexible rates than Tesla. In fact, they may also be your only option if you live in states where Tesla financing and leasing have been prohibited.
How to Afford a Tesla Model 3 with $12.00 an Hour
You can’t afford a Tesla Model 3 if you make $12.00 per hour unless you already have sizable savings, a car to trade in, and little ongoing monthly expenses.
If you make $12 per hour and work 40 hours a week for 50 weeks a year, you’ll make around $24,000. That sum will fall by around 8% after taxes are deducted to leave you with $22,000 or less.
The remaining sum will fund your lifestyle, paying your rent, food, transport, insurance, etc.
With that in mind, it’s difficult to come up with the $44,000 you need to pay for the Model 3 base variant, which is the cheapest Tesla—unless you already have tens of thousands saved up somewhere.
If you don’t have any savings and a decent car to trade in, you’ll have to subscribe to a loan. Assuming a 6-year loan term, you’ll still need to pay $721 per month based on our table above—a sum that only works if you qualify for Tesla’s 2.49% APR. If you don’t qualify, you could end up paying higher sums.
Now, your $22,000 works out at around $1,833 per month. If you add insurance and the cost of charging to the monthly loan repayment, you’ll be spending $921 on your car every month, which is a massive 50% of your income.
Every qualified financial advisor will promptly tell you that spending 50% of your income on a car is wrong. As we briefly mentioned above, most recommend spending under 10% so that maintenance costs and fees will bump the car expenses to a maximum of 15% of your income.
Again, can you live on $912 per month after spending $921 on your car? So, while it’s not impossible to find someone on $12 per hour driving a Tesla Model 3, it’s serious financial irresponsibility unless you have other sources of income beyond the hourly salary. In that scenario, you’re different from the average $12/hour earner.
The Average Income of a Tesla Owner
There is no definitive answer to this question as it can vary greatly depending on a number of factors, such as the specific model of Tesla that an owner has, where they live, and how much they drive their car. However, a 2017 study by Consumer Reports found that the average annual income of Tesla owners was $143,177.
This figure is significantly higher than the median household income in the United States, which was $59,039 in 2016. Therefore, it seems safe to say that the average Tesla owner is quite well-off financially.
How the Average Person can Afford a Tesla
The average person can afford a Tesla if they don’t have any significant debts and only have to worry about rent or mortgage and other minor living expenses.
However, to qualify as an average person, you need to earn at least $53,000 a year, which is the annual mean wage of a U.S. salary worker according to the U.S. Bureau of Labor Statistics (BLS).
Even when you fall into this bracket, you’re very likely to only afford a Tesla with a loan or lease agreement.
What is the Warranty Coverage Offered by Tesla, and What Does it Include?
The Tesla car comes with a four-year or 50,000-mile basic limited warranty, whichever comes first. In addition, you’ll receive an eight-year or 100,000-mile battery and drive unit warranty. This means that if any manufacturing defects are found during these periods, Tesla will repair or replace the part at no cost to you.
Tesla’s warranty coverage also includes a limited warranty for corrosion and perforation of the sheet metal for up to 12 years and unlimited miles. Additionally, the car’s safety restraint system and seat belts are covered for five years or 60,000 miles, whichever comes first.
It’s worth noting that coverage under these warranties is limited to defects in materials or workmanship, so regular wear and tear won’t be covered. Overall, Tesla’s warranty coverage is comprehensive and should provide you with peace of mind when purchasing one of their cars.
How to Order a Tesla
To order your dream car, simply head over to the Tesla website and follow the easy steps outlined for you.
First, choose the model you want, select the color and any additional features you desire, and then select your preferred financing option.
Tesla offers a variety of financing options to make buying a Tesla more accessible, including cash purchases, loans, and leasing. If you choose to finance your Tesla, you can calculate your monthly payment right on the website using their payment calculator tool.
Once you’ve made your selections and finalized your financing, all that’s left to do is submit your order and wait for your new Tesla to arrive.
How Long Does it Take to Get a Tesla After Ordering?
Once you’ve placed your order for a Tesla car, you’ll be excitedly counting down the days until its delivery.
The time it takes for your Tesla to arrive depends on several factors, including the availability of the model you’ve chosen, your location, and the type of financing or payment method you’ve selected.
If you’ve chosen to finance a Tesla, your delivery time may be delayed until your financing is approved. This can take anywhere from a few days to a couple of weeks, depending on the lender and your credit history.
If you’ve paid in full for your Tesla, the delivery process may be quicker, but it will still depend on the availability of your chosen model and your location.
In general, Tesla’s estimated delivery times range from two to eight weeks, so be prepared to wait a little bit for your new ride to arrive.
When ordering a Tesla on the Tesla website, the estimated delivery date is indicated at the top of the order form.
How To Afford a Tesla as a Teenager
Owning a Tesla as a teenager is not easy. Not many teenagers can come up with $44,000 for a car. So what should you do if you want to live the dream?
Work and Save Money
If you still live with your parents, you likely don’t have to worry about any overheads. You won’t have any mortgage or other such bills to pay. It’s the perfect environment to just work and save money for your dream car.
If you start working $10 per hour jobs for 20 hours a week, you’ll have $10,000 in savings per year. Work for 3-4 years, and you could have enough to pick up your dream Tesla. Of course, you can look for higher-paying jobs or work more hours if you can afford to (your academics shouldn’t suffer, for example).
If you have a skill, think about improving on it and charging industry-standard fees. You’re likely to save enough for a Tesla faster if you have a highly marketable skill that can pay you more than minimum wage earnings.
Ask Your Parents
If you have rich parents, you can simply ask them to help fund your Tesla. Granted, many responsible parents will balk at the thought of giving a $44,000+ car to a teenager, but you can increase the chances of landing their support by saving up some money first to show them your seriousness.
If you have saved up the down payment for the car, they may support you by either paying for the car or facilitating a loan.
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