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Retirees live on a fixed income and typically aren’t able to stretch their budget much. However, retiring means treating yourself, and if you’re the kind of person who likes a luxury SUV, you’ll want to know how much it will cost in a decade during your post-working years.
GOBankingRates has broken down the cost of buying a luxury SUV for retirees.
depreciation
Alan Gelfand, owner of German Car Depotshared that the biggest long-term cost of owning a luxury SUV is quite likely to be the cost of depreciation. As an example, Gelfand used the Infiniti QX50. Even when used, the Infiniti QX50 “still has plenty of life left in it and provides a strong base for further investment, but a vehicle’s starting list price that starts at $35,345 for the base model and rises to $69,950 for the range-topping Luxe will inevitably translate into a significant loss of value.”
“Luxury cars lose value more quickly than non-luxury vehicles,” said auto industry expert Melanie Musson. AutoInsurance.org. “They also have a higher initial cost, which leads to a larger impact of depreciation.” Musson said if an SUV that cost $30,000 lost 50% of its value, you would lose $15,000 in value. But if an $80,000 luxury SUV depreciates by 50%, you’ll lose $40,000 in value.
Maintenance and Repair
In addition to the initial purchase price, Gelfand highlighted that maintenance and repair costs over a 10-year period vary by model.
“Individual costs for brake replacement and similar wear parts for most luxury SUVs range from $1,000 to $2,500 per year, rising to $10,000 to $25,000 over 10 years,” Gelfand said. “For some of the more complex European models, these costs can be even higher and may occur even after the warranty has expired.”
auto insurance
According to Musson, since luxury SUVs are much more expensive than other cars, insurance premiums are higher than usual.
“Depending on your driving record, where you live and how much your vehicle is worth, you can expect to pay about $3,000 a year for full coverage,” Musson explains. “You may pay less, but if you have a record of violations or claims, you’ll likely pay more.”
onboard upgrades
In Gelfand’s professional opinion, there is also considerable risk and cost related to the increased complexity of technology, drivetrains and new models, which could increase retirees’ bills for luxury SUV ownership.
“Air ride systems, computerized components, turbo powered engines and all-wheel-drive vehicles can lead to unexpected repair bills,” Gelfand explained. “Even the best luxury SUVs can cost an average of $2,000 to $6,000 per incident to repair, with at least one to two repairs per model over a 10-year period equaling the original purchase price of a new vehicle.”