Remember depreciation when working out car running costs

By | 27th January 2017

Remember-to-include-depreciation-in-your-car-running-costs

I like electric cars – they drive better than other types and are more relaxing.

However, many owners forget to include depreciation when talking about how low their running costs are. Whether you are comparing electric to petrol or just between similar cars, depreciation always needs to be accounted for.

I’ve seen electric car owners talk of a cost per mile as low as 2 pence, compared to a hybrid at around 10 pence per mile.

But, this excludes depreciation which can be quite a bit higher on a new electric car compared to a used hybrid car.

There is a plentiful supply of used hybrid cars available, that can have their manufacturer warranties extended to make them equivalent to running a new car. Whereas your choice for an affordable 200 mile+ range electric car is limited to new ones at present.

It’s no good saving a thousand pounds a year on fuel, only to blow many thousands a year on depreciation…

James McBrearty started his own business from scratch in 2006, to help the self-employed.

He helps people to escape from the corporate world and shares his thoughts here on the changing world of work, technology and personal finances; as well as the occasional travel post.

Over the next 10 years things are going to change significantly. James is a follower of frugality and minimalism; and an advocate of F.I.R.E. to minimise the coming disruption.

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