Welcome to another Tesla Tuesday!
After almost 40,000 miles, the time has come to break the streak of spending $0 on service and maintenance (other than windshield washer fluid.) We’re probably replacing the tires a tad bit early, but they’re down to under 5/32″ in some places and at that point the tire shops stop doing repairs, etc. And since I regularly watch my wife and child drive off in the car, I feel better knowing they can stop quickly when they need to. 40,000 miles seems light to me for tire wear, but reading experiences from other users, it sounds like we did average/well on the stock tires. The cars are heavier and very sporty so it’s easy to burn through the performance tires.
Shopping for tires on our Tesla Model Y was an interesting experience. For example, I’ve never really considered rolling resistance of a tire before. Sure I know that some tires are marketed as more efficient than others, but since Teslas have such detailed economy measurements, I was able to find specific percentage differences in various tires. The challenge is that those measurements were mostly self-reported and varied widely in believability.
The second surprise was being reminded that we are effectively drive a sports car. It can do 0-60 in 4.7 seconds (or 4.2 if you swipe your credit card) and those tires are more expensive than what we bought for our Escape or Impreza.
The third surprise was just how much prices have increased since we last purchased tires in 2019. As I was shopping, I kept getting sticker shock at the total installed price. I got the idea to look up our receipt from 2019, find those exact same tires, and then compare the price. It turns out that the same set of tires from 2019 would have cost 27% more if we bought them now. So add that to the fact that these sportier tires were more expensive than the previous tires (an extra ~$90/tire) and that explains the sticker shock. I did check out Costco and was initially going to use them, but I ended up picking a tire that they didn’t offer. I found their tire prices similar but their installation and warranty was much cheaper.
In the end, I chose the Hankook iON evo SUV tires. They’re less performant than other popular options but offer longer tread life. I also got an alignment done because the initial tires were more worn on the inside than on the outside.
Time will tell how well these new tires hold up. It will come as no surprise to you that I was have an absurd amount of data to eventually compare their efficiency with the stock tires.
Picking Stocks
A relative is going through a class in school where they are picking stocks to see who can make the most play money over the course of the class. On the surface, I think it’s a fine idea, but if this is the only exposure that the students have to the stock market, it might do more harm than good. Picking individual stocks is risky at best and pure gambling at worst. It can be a fun hobby but it should almost never be used as a real investment strategy. So what to do? I sent them some thoughts and figured I would post it here as well.
John Bogle, the visionary behind Vanguard, shares his wisdom in the book “The Little Book of Common Sense Investing” which I’ve written about before. It’s concise, backed by research, and a must-read for anyone thinking of investing their money. Bogle’s book dispels common myths about investing. Here’s the bottom line: picking individual stocks or relying on mutual funds managed by others is a losing game over the long haul. Sure, there might be temporary hot streaks, but consistently beating the market over decades is effectively impossible. The market wouldn’t work if it was possible to consistently beat it.
So, what’s the winning strategy? Low-cost, total market index funds.
The only thing left at that point is to figure out which actual funds to buy. This is where strategies can vary a bit, but they’re generaly fairly similar. Here are two popular strategies:
Of course it’s important to remeember that all of this investing has a bigger tax burden than tax-advantaged accounts like a 401k or IRA. Investing directly in the market is generally only something to consider after you’ve maxed out your better options. Financial health can feel overwhelming but as I’ve written about before, this flow chart does a great job of breaking it down. Or if that’s too much, start with Dave Ramsey’s 7 Steps.
I’m no expert and you shouldn’t blindly follow anything I’ve written here, but you should have your own opinions about this. If you’re going to rely on individual stocks, you should read Bogle’s book and be able to explain why you think he’s wrong. It’s so easy to get sucked into thinking this has to be complicated, but the complicated route will almost always lose you huge amounts of money down the road.