I never thought I’d own a car.
I’ve always lived in cities and had access to public transportation and ridesharing, so historically this has been relatively easy. I prided myself on not having a car given its economic rationality and the slight sense of moral superiority I got by not risking others’ lives in getting behind the wheel.
Then COVID hit, and quarantining in a one-bedroom apartment highlighted all of the negatives of living in New York City that I previously was able to overlook. So I left New York, bought a car, and started driving it around the country.
Dreaming of the open road
Buying a car was the worst consumer experience of my life by an order of magnitude.
For my entire life, people had told me how awful the experience of purchasing a car is. I didn’t believe them: I’m a good negotiator and can handle high-pressure sales tactics. What I neglected to consider, however, was how different negotiation is in one-shot vs. repeated games. You need to approach a negotiation where you’ll never see your counterparty again (e.g., car-buying) in a fundamentally different manner than one in which you want to have a good future working relationship with your counterparty (e.g., salary negotiation). But I’m getting ahead of myself.
I wrote this guide in the hopes that others will have an easier experience than I did.
The first step of the process is to determine the exact make, model, and trim of car that you want.
You’ll have to determine what the most important factors are for you in a vehicle. Safety? Reliability and warranty? Off-road capabilities? Ability to transport heavy-duty machinery? Being competitive in the Cannonball Run?
You’ll also need to set a budget. A car is pure consumption: don’t view it as an investment.
Which way will your doors open?
With these factors in mind, you should be able to determine the class of car that you want: truck, SUV, sedan, etc. From there, look up the rankings for your given class of car. Consumer Reports is a good resource – you may be able to get a free subscription from your local public library. Kelley Blue Book and other sites also compile car reviews from professionals and consumers.
When I started this process, I didn’t realize that the exact same make and model of car can vary in price by $10,000+ depending on the color and any options added on (trim). Look at the difference between the different trims and determine which features (if any) are worth paying for. Personally, I just wanted an affordable car that got me from Point A to Point B reliably and safely, so I chose the base trim.
Once you land on a 1-3 cars that fit your criteria, visit a dealership and give them a test drive. If you have exactly one car in mind, this is to ensure that there are no red flags and that you like it inside and out. If you are choosing between a couple, this can be the factor that separates one from the rest.
At this point, you know the exact make, model, and trim of car that you want. You need to determine how you will pay for the car before you go to the dealership.
If you have the cash on hand to buy the car, great. You may need a cashier’s check from your bank. It is doubtful that the dealership will take a personal check or allow you to put the majority of your car purchase on a credit card.
Likely, you’ll finance your car purchase. Assuming you have decent credit, you can get a loan from any bank. I plugged my information into a few banks’ car loan portals (Bank of America, Chase, etc.). As a very rough estimate of the car price to plug into the site, take the MSRP of the car you’ve researched + 10%. You should end up paying much less than this.
Given current interest and inflation rates, it may make sense to take out a car loan, even if you can afford to pay in cash. For context, in June 2020 I was able to get a 48-month car loan at a 3.19% APR (with a 0% down payment) from Bank of America.
The result of your work will be a form that you’ll take to the dealership that shows you have a loan lined up for the vehicle.
You’ll also need insurance. Luckily, I was able to use my parents’ insurance agent to handle this process, so I don’t have much to add on this topic. Again, Reddit is your friend here.
With a car in mind and funding secured, you’re ready to start negotiations.
Visit individual dealerships’ websites to look at the pricing for the exact car that you want. The pricing on the website may be directionally accurate, but in my experience it is completely divorced from reality. Often, the listed prices will be inclusive of all discounts and rebates (which you may or may not qualify for) and will not include not only tax, title, and license, but $1,000+ charges that the dealership will try to add to your bill when you get there.
You care about the “out-the-door” price. This is the amount that will be on the check that you deliver to the dealership: the price of the car (inclusive of all eligible rebates and offers), plus tax, title, and license.
Email dealerships asking for the out-the-door price of the car. Many will say that they can’t give you a written quote and will try to call you or tell you to come into the dealership. Ignore this – insist on a quote via email. You may have to go back and forth a few times. A good script that worked for me is:
Hi – I am interested in the red 2020 Kia Soul LX listed on your site (VIN XYZ). I am buying with cash and want to make a purchase today based on price alone. What is the best out-the-door price that you can offer?
Obviously, insert the exact color, make, model, trim, and VIN that you have determined in your research. To the dealership, you’re paying in cash since you have financing secured from a bank already.
Email a few dealerships, get their lowest offers, then email them all back to see if they can go any lower. Make them compete against one another for your business. You should let them know that you have a better offer – a line that worked well for me was:
My current best offer is $X out-the-door. If you can beat that, I will come in today to buy.
Note that $X may be your actual best offer, or it might be a couple hundred dollars below that number. 😉
For context, I negotiated a $17,663 out-the-door price for a 2020 Kia Soul whose MSRP was $20,355.
Some things that may help lower the cost:
- Buy a common car. The Kia Soul is not a luxury vehicle – you have much more power to negotiate on a car where dealers are looking to move volume.
- Be flexible with trim and color. I would have preferred a burnt orange or yellow Soul. Was I willing to pay $2,000 more for that? Hell no.
- Buy at the end of the year. (Or buy last year’s model.) I bought my 2020 Soul just two weeks before the 2021 model came out, meaning the dealer wanted to move the 2020 inventory.
- Buy at the end of the month. Some car dealerships get a monthly volume bonus from the manufacturer based on the number of cars that they sell. If they are close to the sale threshold to receive that bonus, they may be willing to give you a better deal on your car.
Be the Hammer, Not the Nail
The car dealership will likely try to fuck you. I visited several dealerships where salespeople didn’t honor negotiated prices, intentionally ganged up on me, and tried to confuse, berate, and belittle me into purchasing a vehicle. Here is your game plan to avoid as much angst as possible.
Walk into the dealership with:
- A friend
- Your financing letter
- Your negotiated price in hand (a printed out version of the email with your final price circled).
At this point, you hand your email to the salesperson and say:
I’ve negotiated the price with your internet salesperson for a red 2020 Kia Soul LX (insert relevant color, year, make, model, and trim here). I am ready to buy. Let me know if you will honor this negotiated price (pointing at the price) and I will purchase the car today. If not, tell me now so that I can walk out the door.
This is aggressive! But you need to be aggressive in this situation so as not to be taken advantage of.
At this point, the salesperson will likely hem and haw that the price you’ve negotiated is for “well-qualified buyers” who are eligible for all rebates or some such nonsense. Insist on the price that you’ve negotiated – you have already established the price you’ll pay based on your exact qualifications in your email exchange, which is conveniently printed out and now sitting in the salesperson’s hand.
Now, the salesperson will either (begrudgingly) agree to sell you the car for this price, or will not honor your written agreement – in which case you’ll walk out the door. When they start to draw up the paperwork, take the car for a test drive to make sure that there are no issues or surprises with the exact car that you’re purchasing.
Remember that you are in an adversarial interaction in enemy territory! You brought your friend to keep a clear head and pull you out of the situation if the sale begins to go poorly.
A rare image of a car salesperson
Assuming there are no issues with the car, the dealership will likely try to get you to finance through them. You can entertain this offer – it may be lower that what you’ve negotiated with the bank. Make sure that there are no hidden fees associated and that you are comparing the APRs of the offers, not only the monthly payments.
I ended up keeping my Bank of America financing because it was cheaper than what the dealership could offer. At this point, you will need to sign a bunch of paperwork to get your car, as well as prove that you have insurance. You will probably need to call the loan officer listed on your financing letter and get them to send a check to the dealership. This will happen either before they give you the car, or within 1-2 days of you receiving the keys. I found the loan officer to be incredibly helpful – a notable contrast with the car salespeople.
Make sure that everything looks right on the paperwork before signing. The final cost should match what you agreed upon via email. If anything looks or feels off during your visit to the dealership, slow down, talk to your friend, and don’t be afraid to walk out the door.
Here are some tricks that various Kia dealerships and salespeople tried on me:
- Told me with a straight face that the total amount that I’d be paying was $18,000, when in fact the paperwork indicated it was $23,000 ($18,000 financed plus a $5,000 down payment today). When I pointed out this fact, they told me that since I’d be paying $5,000 today, that portion “Didn’t count”.
- The same salesman told me that the price indicated on the website only applied if you lease a car (this made absolutely no sense).
- Tried to add $2,500 to the final sale price for absolutely no services rendered because “This is a standard charge for all of the cars that we sell”.
- Took the printed email with the final out-the-door price circled and gave it to the financing manager who spent two hours shuffling papers in the office doing absolutely nothing (I watched). The financing manager then charged me $200 more than he should have on the final paperwork hoping that I was worn down and wouldn’t notice.
Hopefully, you avoid the majority of these issues by negotiating your final out-the-door price via email. Again, if the dealer tries to do anything shady or if anything seems off, slow down and talk to your friend to get a second opinion, stand up for yourself, and walk out the door if necessary.
You’ve purchased a new car without excessive wailing and gnashing of teeth. Hold on to it as long as you can so that you can put off this awful process for as long as possible.
Or, just buy a Tesla. I’ve got my eyes on the Cybertruck.
"Once that bell rings you’re on your own. It’s just you and the other guy." – Joe Louis
Most adults don’t challenge themselves: physically, mentally, or emotionally. Once we move up Maslow’s hierarchy and have a stable career and decent relationships, it’s all too easy to fall into a pattern of either throwing ourselves into a bullshit job or clocking in at work and living through escapist hobbies and our children.
Being a kid is in many ways much harder than being an adult. Looking back on childhood, it’s easy to forget how much we struggled and sucked at new things: how many years it took to become competent readers, writers, or athletes.
I’m convinced that this struggle, the discomfort that comes with being awful at something (not neural plasticity or any other convenient excuse), is what separates children from adults when it comes to learning new skills. Children don’t have expectations of competence, so they are willing to struggle to become good. Adults give up during the pain period.
Personally, it has been easy for me to slip into this rut athletically. I was a good football player in high school, played for a year in college, and have always gravitated towards weightlifting as opposed to any endurance sport. Essentially, I have the perfect body for lucha libre.
You may not like it, but this is what peak performance looks like.
After several years of on-and-off strength training, I was knocked down by an appendectomy. That experience – the realization that, contrary to the popularly-held belief of all men in their 20s, I was not invincible – spurred me into action. Unless I got my ass into motion, this would be my athletic pinnacle. I only have a few years left for any big athletic accomplishments.
Armed with this new humility, I walked into Trinity Boxing Club, an old-school, no-nonsense boxing gym in Lower Manhattan. I was craving the physicality of sport that I had missed out on since I had quit playing football. I also had an unspoken pipe dream of competing in the Golden Gloves.
I only trained hard for about six months before COVID shut down the gym, putting my plans on hold. But even in that short time, I fell in love with boxing. Here’s what I learned.
Just Show Up
Showing up is 80% of the battle. Even on days that you don’t feel like training, you need to drag yourself to the gym. There’s no substitute for putting in those reps.
Natural ability is just a starting point. After that – whether it’s boxing, learning to code, entrepreneurship, relationships, you name it – you need to put in focused hours to become a champion.
Control Your Emotions
The difference between children and adults is that children are controlled by their emotions, but adults are in control of theirs. By this definition, most people never become adults.
Through boxing, you learn how to control your emotions. The first time that I stepped into the ring to spar, my adrenaline was pumping so hard that I was gasping for air after just 15 seconds. Over time, with more reps (see Just Show Up), I learned to calm down. My fear and anxiety were biological suggestions – not imperatives.
Boxing is pain. In a fight, the best case scenario is that you keep your hands up so you don’t get punched in the face…so then your body gets destroyed. Every part of training sucks. You’re gasping for air, your muscles are screaming.
But you learn to embrace this grind. You push on despite your pain. You laugh at it. In boxing, as in life, growth comes not despite pain, but because of it.
"Everybody has a plan until they get punched in the face." – Mike Tyson
In individual sports like boxing and chess, there are no teammates to lean on. There are no excuses for why you didn’t win, no one else to blame when things go wrong. You are the man in the arena.
So when you step into the ring to square off against someone bigger and stronger than you for the first time, it can be terrifying. But you will survive it. And suddenly, your problems at work don’t seem so big. When you’ve faced your anxieties in the ring and lived to fight another day, you are better prepared to face them in other areas of your life.
Paradoxically, boxing also causes you to lose your ego. You will be awful at first. Everyone is. When I stepped into the gym for the first time, I thought I knew how to throw a punch. I didn’t.
You’ll see guys who you think you should be able to knock out with one punch ruin you with technique. You’ll find out how out of shape that you are. And until you put on the gloves to spar, you’ll realize you had no idea just how long three minutes could be.
Nobody cares what brought you to the gym. Girlfriend dumped you? Lost your job? Good. It doesn’t matter what color your skin is or whether you put on work boots or a suit in the morning. Everyone is there to work hard and improve; that’s all that matters.
Men Need to Fight
Men have a biological need to fight and physically compete. When I played football, the thing that gave me the most joy wasn’t having the ball in my hands or even scoring a touchdown, but rather a big hit: physically imposing your will on another man. There is something primal in this, reminiscent of the Greek thumos.
I’ve argued that society is experiencing a crisis of masculinity. Physical sports like boxing help to counteract this. They provide a healthy outlet for male aggression – an enviornment where we can punch one another in the face and then grab a beer afterwards.
I hated every minute of training, but I said, “Don’t quit. Suffer now and live the rest of your life as a champion.”
– Muhammad Ali
Over the past several months, I’ve watched the price of Bitcoin increase 400%, the price of Ethereum increase 1,000%, and the price of Dogecoin increase 5,000% (in bubble driven, then deflated by Elon).
I’ve been kicking myself for standing on the sidelines through all of this. I’ve been researching crypto since 2013, work at a cryptocurrency analytics company, and made some money trading in the 2017 crypto bull run. Yet I’ve had a lot of FOMO as it seems like everyone except me is making money.
To the Moon!
However, there’s a strong argument to be made that I shouldn’t be investing in crypto at all. If you analyze the net present value of my future cash flows, by far my biggest portfolio position – my salary, stock options, and the expertise and personal capital I build through the work I do for 10 hours per day – is long cryptocurrency futures. If I get rich due to crypto, it will be because of TRM stock options, not because I made an early bet on Bitcoin or Ethereum.
This is the smart decision! I shouldn’t be investing in crypto for the same reason that you shouldn’t invest in your company’s stock. Sure, you may think that Apple stock will continue to increase in value (I do), but if a Black Swan event occurs and you’re laid off, you don’t want your retirement account to evaporate as well. See Enron.
So how I spend the majority of my waking time can be represented as a call option on cryptocurrency and blockchain adoption.
- Mortgages. When you take out a mortgage in order to buy a house, you are placing a levered bet on the future of the local labor market. Ask my family who lives in Detroit how that worked out when the auto companies left.
- Relationships. Staying single is holding a call option on your future attractiveness in the dating pool. Assuming a heterosexual relationship, theta is higher for women than for men. Conversely, being in a relationship is selling that call. You earn premium up front, but may miss out on gains.
- Learning. Being a lifelong learner and building a marketable skillset is a hedge against competition in the global labor market. If you’re not continually learning or building your comparative advantage, you have taken a short position on globalization and are not concerned with the risk of educated, motivated people in lower-cost countries abroad taking your job.
- Parties. Attending a cocktail party is spending your time on a far out-of-the-money call option. You may meet someone or be presented with an opportunity that changes your life.
- Hobbies. Odds are that few will read this post. But each time I write and publish online, I pay a small premium (time) for a call option that my writing will lead to opportunities that I wouldn’t get otherwise. Any time spent creating as opposed to consuming is not only buying this call option, but also serves to increase the portfolio diversification of your future earning potential.
- Cryonics. Being cryogenically frozen is a call option on the future of science, as well as being a hedge against death. Pascal’s wager for the 21st Century.
I find it nearly impossible to get deep work done during normal business hours. When there are a million Slack notifications to respond to, emails to read, and personal text messages that pile up, it is difficult to block out the world to write, code, or do any other work that requires focus and brainpower.
It’s much easier to focus on work when the rest of the world is sleeping. In the stillness of the early morning or late night, I have nothing to distract myself from my thoughts, and the weight of Resistance becomes a tiny bit easier to bear.
Every hacker and creative I’ve known experiences this. They do their best work late at night or early in the morning.
Laguna Beach, Night Mode
I am a morning person. When I lived in New York, I loved waking up before 6 a.m. In the quiet of the early mornings there was nothing to distract me. I liked being able to read, write, or work on personal projects and get a solid three hours of work in before I needed to head into the office.
But living in California for the past two months, I’ve found it harder to get work done in the mornings. I can’t beat the East Coast early risers at their own game. By the time I wake up at 5:00 or 6:00, they’ve already been at it for a few hours: sending emails, Tweeting, doing everything they can to distract me. So instead, I’ve been staying up later and later to get things done. The early-morning stillness of New York has been replaced by the late-night stillness of Los Angeles.
Have other people experienced this? Or is it just me?
Smart people should build things. When I first came about this quote, it resonated with me, probably because at the time I was studying at a university where students were funneled into consulting and finance, perhaps the antithesis of building things. I had the tunnel vision of a 21-year-old that knew my decision on what job to take immediately after college was a BIG DECISION that would “determine the rest of my life”.
Lack of perspective aside, there is an immense joy in creation that I believe most white-collar professionals miss out on. Not only that, but gifted people have an obligation to humanity to create that which drives us forward as a species.
Formative Experiences vs. Legacy Building
In my early 20s, my main focus was racking up experiences. I traveled to different countries like a madman, crossing one after another off of my list. I didn’t ever want to miss out on the adventure, the nights out, the people I would meet along the way.
Now, as I settle into my late 20s, my mindset has shifted. I feel the need to produce; to craft a career, to write, to build the close relationships I already have in my life rather than chasing new ones. That’s not to say that the desire for new experiences is no longer there – it is just greatly diminished. I no longer feel the need to meet people that won’t be in my life a year from now. The crazy night out is no longer worth the hangover and lack of productivity the next day. My values have changed from experiencing life and seizing what the world has to offer to creating something of value to offer the world.
Further, creation is the path to building wealth. If you’re not working to make yourself antifragile by building equity or generating multiple streams of income, you’ll forever be trading your time for money.
As kids, we are constantly creating. We draw pictures, devise new games, invent fantasy universes that we populate with imaginary friends. There is an innate, playful yet powerful, drive within us to leave our mark on the world.
To create is human
Contrast this with adulthood. I see smart, talented people in their 20s working at a bullshit job all day, creating slide decks or spreadsheets. Then, tired from work, they go home and passively watch Netflix, scroll through Instagram, or, if it’s the weekend, head to the bar until it’s time to do it over again. This consumption, rather than creation, leads to much of the alienation and existential ennui in postmodern life. This is water.
We were once told that we could be anything that we wanted to be, but our entire schooling system is designed to beat the individuality out of us and train responsible workers. Our drive to create and play is forced to contend with the need to pay rent and have health insurance. It takes intentional effort to break free from this mindset.
Yet, our creative energy still exists. But because we are disengaged from our work, we’re drawn to hollow facsimiles of true creation. This manifests in a few different ways:
- Video games: building skills and progress in virtual worlds.
- The solipsism of sculpting the perfect body: fetishization of two-a-day Barry’s Bootcamp classes, washed down with an organic kale smoothie and a grass-fed steak.
- Taking up a 19th century (i.e., hipster) hobby: brewing beer, woodworking, making artisanal pickles. There’s something tangible and satisfying about these pastimes; they scratch an itch in ways that 21st century knowledge work generally doesn’t.
But for the majority of people, who don’t have the free time and/or discretionary income those activities require, creative energy is funneled into family-building.
Over the years, I’ve noticed that when you ask people with children how they (i.e., the person you’re talking to) are, just as often as not, the response is a list of all the things their kids are doing. Their kids have become their entire lives. I’ve always found this sad.
I understand wanting to have kids – love, biological drive, all of that. But it is inherently selfish to want children. It takes a lot of hubris to think: “Yeah, my partner and I have a complimentary set of neuroses, let’s create a new human with THAT.”
I expect that those of you with a family will read this and think “Check back with me in 10 years when you have kids”. And a part of me expects the same from myself – I fully expect to look back at what I’ve written here in a few years and laugh at myself. But I also think about how much the real world beats down the idealism that we have as adolescents, before we’re exposed to the cynicisms of the world, and wonder if there is a kernel of truth here.
Being a good parent and a good partner is a noble pursuit. But is this the best course of action? Or do people choose to have kids because it is the path of least resistance?
The Cost of Greatness
I wonder how much human potential is lost because we try to do too much. We aren’t willing to make the sacrifices that greatness requires. Because those sacrifices are great.
I think about the companies that have come out of Y Combinator, where during the program founders are told to build their product, talk to customers, eat, sleep, work out, and do literally nothing else.
Or Picasso – perhaps the best-known artist of the 20th century. There is no doubt he was brilliant. He was also a terrible romantic partner and father.
Picasso’s romantic life was a revolving door of affairs and infidelity…[his] singular focus on art meant that everything else in life had to take a back seat, including his relationships and his children.
Les femmes d’Alger, via Quartz
Or maniacal, tortured-yet-brilliant works of literature. From Dave Eggers’s introduction to Infinite Jest:
Here’s a question once posed to me, by a large baseball cap-wearing English major at a medium-sized western college: is it our duty to read Infinite Jest? This is a good question, and one that many people, particularly literary-minded people, ask themselves. The answer is: maybe. Sort of. Probably, in some way. If we think it’s our duty to read this book, it’s because we’re interested in genius. We’re interested in epic writerly ambition. We’re fascinated with what can be made by a person with enough time and focus and caffeine and, in Wallace’s case, chewing tobacco. If we are drawn to Infinite Jest, we’re also drawn to the Magnetic Fields’ 69 Songs, for which Stephin Merritt wrote that many songs, all of them about love, in about two years. And we’re drawn to the 10,000 paintings of folk artist Howard Finster. Or the work of Sufjan Stevens, who is on a mission to create an album about each state in the union. He’s currently at State No 2, but if he finishes that, it will approach what Wallace did with the book in your hands. The point is that if we are interested with human possibility, and we are able to cheer each other onto leaps in science and athletics and art and thought, we must admire the work that our peers have managed to create. We have an obligation, to ourselves, chiefly, to see what a brain, and particularly a brain like our own — that is, using the same effluvium we, too, swim through — is capable of. It’s why we watch Shoah, or visit the unending scroll on which Jack Kerouac wrote (in a fever of days) On the Road, or William T. Vollmann’s 3,300-page Rising Up and Rising Down, or Michael Apted’s 7 Up, 28 Up, 42 Up series of films, or … well, the list goes on.
How many people are wasting their time rearing children or making cheese? And what is their obligation to their immediate family and close friends, as opposed to the world as a whole?
Writing this makes me sympathetic, perhaps for the first time, to the arguments for a centrally planned economy. In the U.S. today, we focus on individual choice, being well-rounded, and the left half of the bell curve (getting test scores up). I’d love to do the exact opposite – identify the geniuses at the far right of the bell curve early on and pour money and resources into their education. Because those are the people who drive society forward; one Jeff Bezos creates thousands of millionaires and hundreds of thousands of jobs.
What is the optimal societal ratio of good fathers to people like Elon Musk, Norman Borlaug, or Bill Gates? Is this even a zero-sum game? To play devil’s advocate, one could argue that exceptional people have more of a moral obligation to reproduce, in order pass on their exceptional genes.
At the same time, when the child is drowning right in front of you, isn’t that the more pressing need?