Electric cars are expensive. If buying an Electric Vehicle (EV) is out of your price range, consider leasing one instead. While you can’t modify the car like you would a hot rod, leasing can be a practical and cost-effective option for the everyday driver.
Check out why drivers who lease EVs enjoy innovative technology and more cash in their pockets.
Mod addicts need not apply
If you have good credit and drive less than 15,000 miles a year, leasing an EV may be your best bet. It’s a lot like renting a car over an extended period, and you won’t have to pay the full purchase price.
“U.S. News & World Report says that you pay to cover the depreciation expected to occur during the lease term, plus interest and fees when leasing an EV,” according to MotorBiscuit. Drivers can also look forward to a lower monthly payment.
Though owning an electric car can be thrilling, more often than not, leasing might be the better option. You won’t be stuck with outdated infotainment systems and safety features. When you lease, you’ll get to enjoy new upgrades when your lease term ends (usually between two and four years).
If you’re a tech enthusiast, you’ll love getting a “new car” to play with every few years. Leasing is also great for those of us who take pride in a well-maintained vehicle. Consumer Reports points out that “there are restrictions, such as how many miles can be driven and how much wear and tear can be inflicted.”
Afraid of commitment? No worries! Leasing an EV allows you to test out different models without attaching yourself to any for the long term. You’re also likely to receive full warranty coverage throughout your term, so paying for repairs could be a thing of the past.
The truth about tax credits and depreciation
Buyers who want to receive the hefty $7,500 federal EV tax credit, may want to think twice before they finance. Unfortunately, the consumer isn’t entitled to receive the credit in a lease. The tax credit will most likely go to the leasing manufacturer, not into your pocket.
According to MotorBiscuit, “Edmunds reports that many dealerships will factor that credit into the lease’s cost, which would ultimately lower your monthly payment. However, dealerships aren’t required to do this.” Make sure you confirm the details before filling out any paperwork.
Cars lose their value over time, and EV depreciation is severe. Tax credits actually lower the car’s initial price. This can work to your advantage when signing up for a lease because this low value is considered.
In three years, your vehicle can lose up to half its value, and owners may end up paying a loan more than the car’s worth. No one has time for that.
Insuring a leased vehicle
Whether you’re going to buy or lease an EV, you’re going to need proper coverage for this new addition to your life. But who has time for boring car insurance research and mounds of paperwork?
If you want to make sure you’re not overpaying each month for car insurance and are curious about switching policies for your EV, download Jerry. The Jerry app gathers quotes from 50+ top insurance companies, like Nationwide, Allstate, and Progressive, in seconds! Jerry even helps cancel your old policy once you’ve made your pick.