The summer is over and soon most car dealerships will be shifting their attention from the 2021 inventory models to the new 2022 arrivals. This year might pose some unusual challenges since the pandemic has severely impacted the assembly line supply chain for vehicle manufactures and left us all facing higher prices. Whether you plan to shop for that new Toyota, Maserati, Honda, Aston Martin, SUV or Moped, have you considered purchasing an electric vehicle (EV), and whether it can save you money?
How Long? Not Long:
Of course, some research on your part is required. The question of how long you plan to keep this vehicle is more relevant now than in the past. Elements of the infrastructure bill pending before Congress provide manufacturers incentives to build and sell more EVs. What follows, then, is the development of electric fueling stations and the increase of gas prices. Although a new EV may cost more than a new gas vehicle, a recent Consumer Report study found that over the life of the vehicle, EV’s were less costly to maintain than gas vehicles.
While you figure out your anticipated vehicle years of retention, how about used versus new?
Used vs. New:
A used EV can be great as a secondary vehicle since they cost less when compared to purchasing new one. This purchase of an EV will allow you to acquire a set of back-up wheels at lost cost, one that is reliable. Also generally, after the first three years the factory warranties and maintenance packages could be reduced. Besides, for example, in the case of a Fiat 500e, your maintenance cost is less since the vehicle has no cooling system, no oil to change and there’s no transmission servicing. The downside of purchasing a used EV is that the battery life has reduced operating capacity since it has been recharged and used several times before. There is also the concern that the used battery technology may be a step or two behind the technology of a new vehicle.
As you consider purchasing that new vehicle here are some factors which may influence your EV decision:
- number of miles you drive each year
- how many miles your EV will get per kilowatt/hour (EV’s cost less to operate per mile)
- whether it has good pickup (EV’s tend to have excellent acceleration)
- what your home electricity costs will be
- whether tax incentives in the form of tax credits for purchasing a new EV apply to your purchase. The biggest incentive for purchasing a new EV is that you may be eligible to receive a federal tax credit of $7, 500.00 ! This could be a game changer especially since leasing an EV would not entitle you to any tax credit. Check with the dealership, manufacturer and your accountant prior to purchase for eligibility.
I have decided to add a new section to Money Monday’s called “ what’s up!” Basically, it is something very important I think you should know and may be unrelated to the main article. Today’s what’s up is about store credits, gift cards and vouchers. Currently, there are about $15 billion in unused gift cards and store credit held by 51% of adults. This is according to a recent survey by Bankrate.com.
The average value per person is approximately $116 in unused gift card funds. So, if you are having trouble spending money, send me an email or text and I’ll give you may account. Seriously though, what’s even more perplexing from the survey is that 73% of the adults with unused gift cards, vouchers and store credits have left those funds untouched for more than one year. Listen! Develop a plan to get rid of those funds before you lose them permanently. Contribute to a family in need, nonprofit or church; but for crying out loud, don’t lose the value of your gift card! And that’s what’s up!
Ruthven R. Phillip, Esq., is a tax attorney, Stewardship and Philanthropy Ministry Assistant, and CEO of Give2Getrich, LLC. Give2Get Rich, LLC 2021. All Rights Reserved. Any distribution or reproduction of part or all of the contents in any form is prohibited.