Skip to main content

Get plugged into the costs and benefits of electric cars

What we'll cover

  •  The benefits of buying an electric vehicle 

  • How fuel, maintenance and taxes are impacted

  • The drawbacks of owning an electric or hybrid car

It seems you can’t drive a mile these days without stopping at a red light behind a hybrid or electric car. The uptick in vehicles running on batteries instead of gas is not surprising, as several major car manufacturers from GM to Ford and beyond continue to put out new models. While battery-powered options become increasingly commonplace, drivers are more often weighing the pros and cons of electric vehicles. You may even find yourself wondering, “Can going green with your wheels actually save you green?”

The benefits of going electric

Just like a battery has a plus side and a minus side, battery-powered cars also have important positives and negatives to consider. But first, let’s start with the good stuff.

Environmental friendliness

A big perk of electric cars is that they’re often better for the environment. Not only do they cut down on CO2 emissions and smog, but electric vehicles also sidestep a lot of the energy and pollution used to extract and refine gasoline.

Drive farther with fewer stops

These days, electric vehicle batteries have way more power than their earlier versions. Whereas a decade ago some electric vehicles could only drive about 70 miles, today most can carry you for more than 200 miles on one charge.

Pick from more options than ever before

When you think of hybrid or electric cars, you might only picture a Prius or a Tesla, but you actually have a much greater selection to shop from. You’ll find electric vehicles vary widely in price, from about $30,000 to more than $100,000 — meaning there is a model available for just about every budget. When researching rides, consider this  top ten list  as a starting point.  

Big time savings on fuel

Frequently filling up on gas can be a real budget buster. While every car is different, electric vehicle owners are likely to spend about 60% less to power their ride. This translates to an annual savings of about $800 to $1,300 — or $6,000 to $10,000 over the life of your car. See how much you can save in fuel costs using this calculator from the U.S. Department of Energy.

Save on maintenance

Research shows that those with an electric car spend about half as much to repair and maintain their vehicle, compared to gas-powered auto owners. That’s about $4,600 over the course of your car’s lifetime. Just keep in mind that electric cars still need some TLC, like regular tire rotations and brake replacements since the battery can exert more torque on the wheels.

Enjoy a lighter tax bill

New and used all-electric and plug-in hybrids often qualify for federal income tax breaks — up to $7,500, depending on battery capacity and state initiatives.

Electric vehicle owners are likely to spend about 60% less to power their ride

The drawbacks of owning an electric or hybrid car

Of course, going electric comes with its own set of costs and considerations. Read on for what you should expect.

Higher purchases prices

When you compare regular gas-only vehicles to their similar electric counterparts, electric cars tend to cost between 10% and 40% more, according to an analysis from Consumer Reports. While you may break even in savings over the lifespan of your car, the upfront cost may make going green a little more difficult.

Less resale value

Electric cars tend to lose value quicker than gas-only vehicles, meaning you may not be able to sell or trade in your hybrid for as much as you would a conventional model. While this could be a negative for car sellers, you could also view it as a positive: You may find used electric vehicles come at a better price than used gas-powered cars.

Charging time and cost

While prices per gallon fluctuate, a typical eGallon (or the cost of fueling a vehicle with electricity) is about half the price of a gas gallon. But you’ll want to consider when and where you’ll charge your car. Do you plan on charging your car at home, or does your work offer free charging stations to juice up your e-wheels during the 8-hour workday? If charging at home, make sure you have an outlet you can safely use and be prepared for increased electricity costs. Electricity prices vary, especially state by state. For example, it’s way cheaper to have an electric vehicle in Louisiana than in Hawaii. See the average price of electricity for your state here.

Finally, do your homework when it comes to public charging stations. Some charge by the hour, so the faster your car fuels up, the better. An easy rule of thumb? Typically, the older the electric car model, the slower the charge.

Do the electric drive

Back in the day, driving a hybrid or fully electric vehicle may have seemed far-fetched, overly expensive or complicated, or too limited in choices. But now, as more and more car companies expand their plans and commit to reducing the number of gas-guzzlers on the road, driving electric is more feasible than ever. With options in all prices ranges — and pretty spectacular potential savings — an electric vehicle may soon be in your driveway’s future.

Explore more

Car Invest Security

Read next

Young girl charges electric car while family loads the trunk with picnic gear. Can EVs solve your gas pump woes?

July 14, 2022  •  8 min read

Two children washing a car.


Tips for maintaining your car’s value

June 8, 2022  •  5 min read

Money solutions and strategies sent straight to your inbox.

Tips and tools to help you build your best financial future.

Let's Connect