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Thinking About Buying an Electric Vehicle?

Is an electric car worth it? With big tax rebates still available and the appeal of never needing to buy gasoline again, it can seem like a no brainer. However with the need to install charging equipment, the cost of electricity, and the possible need to replace a battery, the money can still add up. Here’s the bottom line on what owning an EV can mean to your wallet.

The cost to run a gas-powered vehicle averages out to around $1,100 a year. Obviously, that cost can vary greatly between a 15mpg SUV and a 30mpg compact. The average EV costs less than half that, around $490 a year. These numbers make it seem like an easy choice. But there is more to think about.

Your home is probably already set up for a fossil fuel vehicle. The whole world is; it’s been an established system for well over 100 years. If you somehow run out of fuel in your driveway, you probably can walk to a gas station and grab a gallon to get your car moving again.

Yes, your home is already wired for electricity. But you may not have a 30amp, 240volt hook-up in your garage. If you do, it's already in use by a clothes dryer. The wall mount charging unit and plug will cost between $500 and $700. Add on the cost of an electrician to install it and you’re looking at over $1,000. You can install the charging unit to be removable, plugging it into the same type of plug an electric dryer uses. If you move, you can take it with you. Or in a few years, it could be a selling feature for a house.

The cost of your charging bill is going to add to your home electric bill. One way to offset the cost is to install solar panels. If you have the funds to install them, they’ll pay for themselves in a few years. Solar could potentially earn you money in the long term by pumping energy into the grid. Again, you’d need the money upfront to make it happen.

The biggest cost to consider is battery replacement. Most brands offer an eight-year warranty for new batteries. A new battery is going to cost $8,000 to $10,000. Average that out with the cost of running the vehicle and you’re quickly over the cost of a gas-powered car in the same time. That isn't to say the battery will need to be replaced in eight years, but after that time it becomes an out-of-pocket expense.

If you’re looking at a used EV, make sure you have the battery checked over. The used market is still very new for EV models. Some brands will transfer the battery warranty. If the vehicle you’re looking at doesn’t offer that, make sure to price out a secondary warranty. A four-year-old car with a $10,000 repair bill isn’t financially sound.

The final thing to think about with an EV is time invested. If you plan to use it around town where you have access to charging stations, then time isn’t an issue. But if you plan to travel long distances at all, you have to take into account the time it takes to charge your car. A quick five-minute pit stop could turn into a two-hour stop.

Overall, an EV can be a sound financial move. Between rebates for the vehicle and potential solar panels, you can save a lot upfront. There is potential that the value of your home will increase by making it EV ready. Keep an eye on that battery life, though.

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