Additional Coverage:
- Used Tesla Prices See a Major Drop, but EV Buyers Need to Be Aware of These Hidden Costs (financebuzz.com)
Thinking of Going Electric? Here’s the Real Scoop on EV Costs
With gas prices still putting a dent in wallets, many drivers are eyeing electric vehicles (EVs) as a potential long-term solution to cut down on car costs. And with Tesla shaking things up by discontinuing their Model X and Model S this spring, the used EV market is heating up, offering some surprisingly affordable options.
For instance, a 2017 Model X, once sporting a $75,900 MSRP, can now be found for as low as $22,990 on some used car platforms. Kelley Blue Book even estimates a typical listing price around $25,340. This means a once-aspirational midsize electric SUV is suddenly within reach for a wider range of buyers, with many listings under $30,000.
But before you jump on the EV bandwagon, it’s crucial to look beyond the initial price tag and consider the ongoing expenses. Here are some “hidden” costs that could impact your budget:
The Upfront Price Tag
While used EVs are becoming more accessible, new electric vehicles often carry a higher purchase price than their gasoline counterparts. In late 2025, the average EV hovered around $58,000-$59,000, roughly $10,000 more than the average gas vehicle, largely due to demand and advanced technology.
State Registration Fees
Since EVs don’t consume gasoline, states miss out on fuel tax revenue used for road maintenance. To compensate, many states are implementing additional registration fees for EVs, ranging from $50 to $200 annually. Be sure to check your state’s regulations to factor this into your budget.
Charging on the Go
While home charging might see your electricity bill rise slightly, the real surprise often comes with public charging. While the average home electricity rate is around 17.8 cents per kilowatt-hour (kWh), public charging can cost anywhere from 30 to 60 cents per kWh, with fast chargers sometimes hitting 60 cents or more. This means public charging can be two to three times more expensive than charging at home – a detail many new EV owners overlook.
Higher Insurance Premiums
EVs often come with higher insurance premiums, averaging about 49% more than gas cars. This is primarily due to the increased cost of repairing and replacing electric vehicles. Shopping around for the best EV insurance deal is highly recommended.
Battery Replacement
While EV battery technology is constantly improving, you’ll likely need to replace your battery around the eight-year or 100,000-mile mark. This can be a significant expense, ranging from $5,600 to $20,000.
Unlocking Add-Ons
Many EV manufacturers, like Tesla, offer enticing features such as self-driving capabilities or acceleration boosts. However, these often come with an additional cost to unlock. It’s worth exploring other EV models to see if similar features are included as standard.
Home Charging Station Installation
While fast chargers are convenient, setting one up at home isn’t cheap. The average installation cost ranges from $800 to $3,000, depending on labor, permits, and electrical upgrades. You may also need a charger specific to your vehicle, limiting cost comparison.
Temperature Sensitivity
Extreme hot and cold weather can negatively impact an EV battery’s ability to hold a full charge, potentially leading to increased charging costs to maintain your desired range.
Charging Time
Time is money, and while not a direct financial cost, charging time is a factor to consider. Even with a fast charger, a full charge can take under 30 minutes, which is still considerably longer than filling up a gas tank. Without a fast charger, charging times can stretch to seven, eight, or even 12 hours.
Depreciation
Like all vehicles, EVs depreciate, often losing a significant portion of their value in the first few years. Some reports indicate EVs can lose up to 52% of their value after three years, compared to 39.1% for traditional internal combustion engine (ICE) vehicles.
Loss of Range in Cold Weather
While all cars experience range loss in cold temperatures, it’s a more significant concern for EV owners. This means planning longer trips around charging points and anticipating more frequent stops when the mercury drops, especially given the scarcity of public charging stations in some areas.
Shorter Tire Lifespan
The heavier weight and increased takeoff torque of EVs can shorten tire life, leading to more frequent replacements. Expect to pay $200 to $300 per tire, with replacements needed roughly every 25,000 miles.
Higher Repair Costs
EV repairs can be more expensive than those for gas-powered vehicles, and EVs can sometimes be less reliable. Finding qualified EV mechanics can also be challenging, and some manufacturers may restrict who can repair their specific vehicles.
For example, Tesla’s annual repair cost average is $832, compared to $652 for all car models. The scarcity of specialized parts can also drive up repair expenses.
The Bottom Line
If you’re considering an electric vehicle, it’s essential to factor in these potential “hidden” costs. While the financial advantages of going electric, especially with high gas prices, can be significant, a thorough review of your budget and driving habits will help you determine if an EV is the right fit for you. You might find it’s time to plug in, or decide to stay unplugged for now.
Smart Money Moves for Everyone
No matter your financial situation, there’s always room to improve your wealth. Here’s a quick guide to boost your finances today:
- Boost Your Income: If your budget feels tight, explore side hustles that complement your full-time job or discover legitimate ways to keep more cash in your pocket.
- Grow Your Savings: Time and compound interest are powerful tools for building wealth.
Start by understanding your current financial standing to create an action plan. For those aiming for early retirement, professional financial guidance can be invaluable.
- Seize Opportunities: Maximize your benefits by taking advantage of all available deals, discounts, and money-saving opportunities. For car owners, ensuring you have the most competitive car insurance rate can save you hundreds.
Conversely, be vigilant in avoiding money-wasting traps that silently drain your bank account.