How to harness the power of EV technology without breaking the bank

Across the country, consumers are charging toward electric vehicle (EV) adoption. Last year, over 5% of new car sales were electric. Compared to traditional gasoline cars, EVs don’t contaminate the air with dirty tailpipe pollution and can dramatically lower carbon emissions from making trips to work the grocery store. While the environmental benefits of EV technology are clear, some people are hesitant to make the switch because they believe that EVs are too expensive. 

Although it’s true that some of the top luxury EV models can be expensive, there are plenty of ways to access electric transportation without breaking the bank. One of the most affordable ways to get your hands on an EV is to consider buying a used vehicle. Similar to any other car on the market, used electric cars have already depreciated in value, so they are often much more affordable than new models. As of January 1, 2023, it’s more affordable than ever to buy a used EV because of unprecedented incentives from the federal government passed through in the Inflation Reduction Act (IRA), which became law in August 2022. 

The IRA established an important credit for used EVs that is available in every state. If you purchase your used EV from a dealership and you meet the income qualifications, you can be eligible for up to $4,000 tax credit that can be used to offset the vehicle’s cost. There are requirements to qualify for the used-EV incentives: the vehicle must cost less than $25,000; the model year must be at least two years old; the income cap to be eligible for the used EV credit is $75,000 for single filers, $112,500 for head of household and $150,000 for joint filers; you need to buy from a dealer; the credit can only be used once per vehicle.

In addition to federal incentives, you should also look into state local government tax credits and programs to encourage EV ownership and further bring down the price of an EV. Many states and local governments offer rebates, tax credits and other incentives to encourage the purchase of electric vehicles. It’s a good idea to check with your local government to see what incentives are available where you live.

If you’re using a loan to buy an EV, you should know that several banks offer special financing options for EV purchases, including lower interest rates. These special financing options are known as green auto loans. It’s important to note that interest rates can vary and so it’s a good idea to shop around and compare different offers before making a decision. It’s worth checking with your local credit union because it’s possible that they may offer special financing options for EV purchases too. Some EV manufacturers also provide financing options, so you should check with the carmaker directly to see what options they have available.

With the skyrocketing demand for electric vehicles, the market is becoming more competitive and EVs are starting to become more affordable for the average consumer. We can already see this happening in 2023 as Tesla has slashed its prices on its electric vehicles by as much as 20% starting in mid-January.

Purchasing an electric vehicle should not put a drain on your finances. By considering options such as used electric vehicles, government incentives and financing options, you can find an EV that fits your budget and helps you do your part to clean up the air in your community and help fight climate change. If you’re interested in finding out more information on how to purchase a used EV, check out this recording of our recent webinar.