How Much Money Do You Save With an Electric Car

We’ve officially made it to the year 2022 and can now say that we’re in the future.

Even while flying cars and teleportation aren’t yet a reality, the technology in our vehicles is constantly improving, making transportation faster and easier. As additional models are made accessible, electric vehicles may reach a new level of popularity.

Did you know that transportation is the second-largest expense for an average American household? But with the rise of hybrid and electric vehicles, you can save money by switching from a gasoline-powered vehicle to an electric car.

To put things in perspective, if you buy a Model 3 instead of a BMW 330i, you will save $17,600 throughout the vehicle’s lifetime. If you go with a Tesla Model Y instead of a Lexus crossover, you will save US$13,400. Similarly, if you buy Nissan Leaf instead of Honda Civic, you will save around US$6,000.

You’ve probably heard that these fuel-efficient cars are more expensive than their gas-powered equivalents, but is the extra expense worth it?

How much money will i save with an electric car
How much money will I save with an electric car

Electric vehicles are here to stay. The number of electric vehicles available for purchase is growing steadily.

A 46% increase in total sales in the first half of 2018 was recorded by the Edison Electric Institute, while in 2019, global EV sales were worth 1.1 million.

The increase in sales was due to the introduction of the affordable Tesla Model 3. Keep reading to learn more about how much money you can save with an electric car.

Here’s How Electric Cars Can Help You Save Money

Consumers will soon be able to choose from more than 500 different electric vehicles (EV) models around the world in only two years. There is also a significant increase in the number of electric vehicles sold, particularly in the USA, over the last few years.

Experts predict that they will control 58% of the market by 2040. It’s surprising to know that only about a third of electric vehicle buyers are former gas or flex-fuel drivers.

So, if you’re thinking about making the transition to an electric car, it’s necessary to know how much money you’ll save.

1. Lower Maintenance Cost

An additional benefit of moving to an electric vehicle is reduced maintenance needs.

When you buy an electric car, you won’t have to spend money on maintenance or repairs because it doesn’t have many moving parts found in an ICE vehicle.

Regenerative braking is common in electric vehicles, which reduces the need to replace brake pads and rotors altogether. The less time and money spent at the shop, the more desirable it is.

Electric vehicles require some maintenance, but they are significantly less time-consuming and cost-effective than gasoline-powered vehicles.

Even if you choose a plug-in hybrid electric vehicle with an internal combustion engine, your maintenance costs will be cheaper. Since the PHEV engines operate less frequently, they use less oil and coolant, resulting in lower operating costs.

2. A Noticeable Reduction in Fuel Cost

Traditional vehicles need to be refueled at a nearby charging station almost daily. On the other hand, an electric vehicle provides better value for your money.

The electric vehicle will save money in the long run, even if you’re using power to charge it.

When it comes to annual operating costs, a University of Michigan study from 2018 found that electric automobiles cost less than half compared to gasoline-powered vehicles.

Electricity prices fluctuate less than oil prices; thus, it is crucial to keep this in mind. Since your electric vehicle is powered by the energy provided by your local utility, this makes sense. A greater understanding of refueling expenses might help you plan better.

You should expect your vehicle’s charging cost to be fairly consistent every week because most EV drivers charge overnight at home or while they’re at work.

3. Tax Incentives

There are numerous tax benefits and incentives available to EV owners and those building commercial charging stations. You can get up to $7,500 in federal tax credits (depending on the capacity of your battery) if you buy an electric vehicle.

It’s possible to find extra incentives from states, localities, or utility companies when a company sells 200,000 vehicles (as Tesla and General Motors have done).

Various utility companies and state governments can finance commercial EV charging stations. $174 billion is included in the government’s infrastructure plan to encourage more people to drive electric vehicles (EVs).

There is no road tax to pay for any “pure” electric vehicle on the road. If you drive a PHEV or HEV, the car tax you must pay is based on how much carbon dioxide it emits.

A mileage reimbursement program approved by the HM Revenue and Customs allows you to claim mileage back if you use your electric vehicle for business purposes.

Whether you drive an electric car or one fueled by gas or diesel, it’s still feasible to save money this way. Up to 10K miles per year, HMRC allows you to deduct 45 cents per business mile driven. It is possible to receive 10p for each mile driven above 10K miles in a calendar year.

Not only do these programs make it possible for drivers to charge their cars conveniently at home, but they also give business owners a way to attract new customers while also promoting environmentally friendly practices.

As an added incentive, businesses that put in commercial charging stations can claim a tax credit of up to $30,000. Due to this, many North American drivers and business owners will be able to afford to buy an EV or install an EV charging solution.

How much money can you save with an electric car
How much money can you save with an electric car

4. Free Electricity through Solar Panels

Purchasing an electric car and installing solar panels saves money on the car and the panels because of the lower initial investment.

The combination of solar panel systems and electric cars has various advantages that can be maintained for many years to reduce environmental impact, save money, and increase value.

Installing solar panels to charge electric cars can pay off more quickly than using them for your home’s electricity needs alone because the solar power you generate replaces more expensive fuel.

Apart from that, there’s a high return on investment in solar panel installations for electric car charging.

Solar Marketplace users typically break even on the cost of solar panel installation in seven to eight years. For as long as your solar panel system is in place, you won’t be charged for electricity generated by it.

With a solar panel system, you can reduce your reliance on fossil fuels and create free energy for more than 25 years. They have an average lifespan of 25 to 30 years.

Installing a solar panel system will provide you with free electricity for at least 25 years, in addition to delivering a good return on investment. There’s a good chance the solar panel system will continue to power other electric vehicles for many years to come.

In places with high electricity costs and robust solar incentive schemes, home values are rising by 3% to 4% on average.

Finally, adding solar panels will increase the value of your home. Values and sales are greater and faster for properties with solar panel systems.

5. Reduction in Charging Hours

Plug-in hybrids save 30% to 60% on gasoline compared to traditional gas engines. Plug-in hybrid automobiles include a fuel backup if the battery’s charge runs out. 

PHEVs use fuel more effectively than normal gasoline-based vehicles and operate more like hybrid vehicles when converted from battery power to petrol; however, charging and fueling the vehicle is more expensive.

Since they use their car’s internal combustion engine to recharge the battery, they help you save money on power and cut down on the number of hours it takes to charge the vehicle.

6. Government Grants

In December 2021, the US government announced that the grant program for zero-emission vehicles had been revised to target less expensive models, allowing the program’s money to go further and help more individuals convert to electric vehicles (EV).

The government is offering grants to encourage drivers to acquire low-emission vehicles. Purchasers have to pay less for a new electric automobile to obtain the grant money. Amounts allocated by the federal government towards the EV transition have not changed.

There are presently roughly 20 EVs on the market that qualifies for government incentives of up to $1,500 this year. This ensures that taxpayers’ money is put to the best use and that as many individuals as possible can profit from it.

7. Less Incidental Expenses

Drivers pay at the pump but end up entering the store, where they are enticed by a wide range of goods such as food and cigarettes as well as a variety of drinks and accessories.

On a one-off basis, the expenses might not seem significant, but they can quickly add up, costing you a few hundred dollars every month.

8. Free Charging BONUS!

If you’re passing a free charging station on your way somewhere, the money you’ll save by charging for free might be worth the few minutes it’ll take for the tank to fill up.

In addition, knowing where charging stations are located in your area might save you time and trouble when you’re planning a road trip to a new location and your battery is running low.

You’ll find some great deals if you spend some time getting to know your town or area. This requires some research, but things get much simpler once you’ve figured out the best station.

It’s important to know how much it costs to charge your car at home and any commercial charging stations you frequently use. Once you’ve done that, try to charge as much as possible using the cheapest electricity you can find.

Things You Should Know About Electric Car Insurance

How Much Money Do You Save With an Electric Car
How Much Money Do You Save With an Electric Car

You’ll need to consider the same risk factors that determine the cost of car insurance as you do for other types of vehicles. Due to the increased cost of purchasing an electric vehicle, insurance premiums are more expensive for EVs.

It currently costs a little more to insure an electric vehicle than a traditional gasoline-powered vehicle since insurance companies have to pay extra for battery repairs since high-tech batteries are more expensive to fix.

When an electric car gets damaged, it can cost a lot more to replace expensive electrical equipment because fewer electric cars are on the road.

For example, we looked at the variation in Tesla insurance premiums by model and year and came up with some surprising results. Annual insurance premiums for electric vehicles are about $400 or more.

Once more electric cars are on the road, repair prices are expected to fall.

If you end up being very lucky, you can save money on car insurance by driving an electric vehicle. Your insurance company may be able to help you save money by switching to electricity.

Only a few utility companies offer lower rates to owners of electric vehicles who charge the vehicles during off-peak hours or through a separate utility meter.

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Final Thoughts

There are numerous advantages to switching to electric vehicles. From the environmental impact to saving money on fuel, cost, tax, government grants, and maintenance, electric vehicles can save you a lot of money in the long run.

Electric cars are undoubtedly more cost-effective and easier to maintain than fuel cars. So, are you ready to replace your petrol or diesel car with a pure electric model? Well, there are plenty of powerful EVs to choose from, but which model caught your eyes first? Write to us in the comments below.