Why I Buy Tesla Stock Instead of a Tesla Automobile

Before explaining why I enjoy buying Tesla stock, here is some background on my recent car:

As I have written about previously in my Car Fever Story (https://financialsombrero.com/car-fever-1), I recently purchased a brand new car- it's a VW e-Golf 100% electric car. The car is basically a compliance car, which roughly means that it is a car produced by major auto manufacturers to remain in compliance with the regulations that require x number of Electric Vehicles be built in a given period.  

Very Low Price

My car was priced at 39K, minus the $10,500 on the spot dealer discount, minus the $10,000 federal and state discounts, minus my local utility discounts of $3,200 dollars-- putting my actual out of pocket cash price around $16,000 dollars.

I sold my previous EV for $5,800 dollars-- so my current pre-tax cost is closer to $10,000 dollars for a fully optioned leather/premium trim packaged car.  If you buy the standard edition version of the 2019 vw e-golf, then your costs will be reduced by another $6,000 dollars. Yes, a VW compliance cars offered in my state of California comes with a host of savings, making it an easy financial decision.   

Daily commuter:

The VW e-Golf if my primary daily commuter and weekend family car that I really enjoy.  The car is a stealth EV, as it looks like the current VW Golf, and it even has the appearance of bumper/muffler cutaways, even though there is no actual exhaust. Once comment that surfaces regularly in conversations about my new electric vehicle is the comparison to a new Tesla Mode S, Model 3 and Model S.  Some people go as far as telling me that I need to upgrade to the Tesla ecosystem of Car, Solar and Battery so I can be part of the club! 

Tesla cars are awesome. 

I really admire the design and technology that ships with the Tesla Model S. I almost purchased a $32,000 dollars used 2013 Model S instead of this current VW e-Golf earlier this year.  This Tesla had my favorite color and options, it was a one owner well maintained car, but it was also a used car that would be out of warranty in a few years, it had not HOV lane sticker, and it still had the original motor, screen and battery system. I keep a picture of this Tesla Model S that I test drove and pondered purchasing on my phone- so yes, I am a fan of Tesla, so you won't hear Tesla Model S bashing from me. 

Here is why I didn't purchase the Tesla, and why I really enjoying buying Tesla Stock

As with most investment decisions, there is a little bit of research, analysis and math, and some personal decisions and bias on the value of the company stock I want to purchase. Tesla motors continues to build solid automobiles with leading technology features that put most other car makers to shame. For this reason, I choose to focus on the long term positives in terms of the long term value of the Tesla Motors company as opposed to Tesla's shorter term negative issues, such as significant debt, managements musical chairs, etc.  

Tesla Costs

I have been purchasing TSLA stock for some time, with the bulk of of last year when I was actually considering buying a new Tesla Model S P100D. The price of the car I wanted was around 150k. So I had to choose, take my hard earned cash and buy a very expensive toy that would depreciate rapidly, or invest the 150k into my portfolio of index and dividend focused stock funds. 

Potential impact of cost

Had I I purchased the Telsa Model S I would no doubt be writing an article today about the benefits of the Tesla car. Since I decided to double down on all of my investments however the financial results are quite favorable to my long term net worth plans. 

The $132,000 dollar mistake I didn't make.

Tesla Stock (TSLA) was priced a $185 dollars back in May of 2019. Today it's valued at $349 dollars per share, which represents a 88% percent increase. To put it into perspective, $150,000 invested in May of 2019 of Tesla Stock would currently be worth approximately $282,000 dollars today. Obviously this would be a perfect market timed trade, but the numbers should give you a clear picture of the benefit of owning and holding certain stocks vs buying expensive items. 

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Note that I am not a financial or legal professional, nor am I licensed to sell securities, or any other financial instruments. Given this statement, I strongly recommend that you consider this blog as entertainment value. Although, I sincerely hope that I can motivate you to learn to build your own financial knowledge and wealth