Three years ago, Sara Lee worked for Meta and felt confident in buying a new 2021 Tesla Model 3. Now, as the global head of product marketing at TikTok – making $400,000 a year, no less – she says financing the car at full-price was a “huge mistake.”

Lee told CNBC that as of this month, she still owes $36,000 on the car, which is more than the EV is worth. Indeed, per Carvana and even Tesla’s used inventory listings, 2021 Tesla Model 3 prices go as low as $25,000. Hertz still has two 2021 Model 3 listings set even lower, at $20,975 and $23,346.

Lee says that she made the purchase right after splitting with her ex, who refused to buy the EV. “I like the car, but I would have bought it used or would have thought about it a little bit more because now that I’m paying for it and looking at my monthly statements more closely, a thousand [dollars] a month is a big deal,” she told CNBC. “If I had put that into something else, I would have been making more money in terms of my investment return.”

The sentiment proves that even high-income folks who opt for car payments still lose out financially overall. Cars are not investments but depreciating expenses. Making high payments on machines that require costly repairs and maintenance leaves many Americans underwater.

To avoid getting painfully underwater with a new car, try the following:

If you can’t comfortably pay cash for a new car: Look at used vehicles in your “cash-only” budget first.

When financing feels unavoidable: Choose practicality over status symbols. Most new cars – and even a lot of certified used – look and feel pretty dang sharp anyway.

Focus on payment terms: Shop around and negotiate for the lowest interest rate possible, the lowest total monthly payment possible, and the shortest allowable term.

If you can swing it, pay off a car loan early: In Lee’s case, if she simply continues making regular payments for the full term of the loan, she’ll only lose more money on the car. The Tesla Model 3 will continue to depreciate, and she’ll pay the full interest costs built into the agreement. She might be better off fulfilling the loan early and either cutting her losses by selling it or trying to keep the car free and clear for the next few years.