7 Worst American Cars for Retirees on Budgets
As retirees navigate their golden years, budget-conscious decisions become paramount, especially with large purchases like a vehicle. It’s not just the purchase price that’s important, you should also consider ownership costs. Fuel efficiency, reliability and longevity will all affect the true cost of a car over its useful life.
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While American-made cars boast a rich history and diverse offerings, they aren’t as famous for being cheap and reliable, at least not in the way imported brands like Toyota and Honda are. Not all models are created equal though.
Here are seven cars experts say are among the worst choices for retirees on budgets.
Any Luxury Car
Let’s get this out of the way first: If you’re on a budget, a luxury car is a terrible choice. The high price tag is an obvious issue, but you might tell yourself that you have a large stash of money saved up and you can afford it. Well, the high cost of luxury vehicles goes well beyond their initial purchase price.
Joe Giranda, director of sales and marketing for the high-end car shipping firm CFR Classic, gave the example of the Cadillac Escalade.
“The Escalade, while embodying luxury and comfort … is associated with considerable maintenance costs,” he said. “This high-end SUV is known for its spacious interior, advanced technology features and powerful performance. However, these attributes contribute to its elevated initial purchase price. Beyond the purchase price, the Escalade’s upkeep, including parts and services, tends to be costly.
“In addition, its fuel efficiency is lower compared to more economical vehicles, meaning ongoing costs at the gas pump can quickly add up.”
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Tesla Model 3
At first glance, an electric vehicle sounds like a solid choice for retirees on fixed incomes. They may cost a little more, but you could potentially never have to pay for gas again. Throughout a decades-long retirement that adds up to some impressive savings.
When you think of EVs, one of the first cars that comes to mind is likely a Tesla. While most Teslas are pretty pricey, the Model 3, starting at just over $40,000 for the 2024 model year, is at least affordable.
However, Melanie Musson, an auto industry expert with AutoInsurance.org, warned retirees against a Tesla Model 3.
“There are a lot of good qualities to the Model 3, but it’s not a great option for seniors for a couple of reasons,” she said. “First, it depreciates faster than most other cars. In fact, over five years, it will lose half its value. If you want to depend on the same vehicle throughout your retirement, you probably won’t be able to with a Tesla because the battery will wear out. Buying a new battery could cost as much as some cars cost new. Additionally, the insurance premiums for EVs are higher than the premiums for internal combustion engine vehicles.”
Chrysler 300
Full-size sedans are hallmarks of American-made cars, although the segment has gotten smaller and smaller over the years. Larger sedans have historically been popular with older folks due to their spacious interiors and more comfortable rides. The Chrysler 300 is one such sedan; it is relatively affordable for its size, starting at a little over $37,000 for the 2023 model year.
One key flaw that makes the 300 particularly bad for retirees on a budget is its fuel economy, according to Tariro Goronga, the CEO of DriveSafe Driving Schools. The base model with a V-6 gets a dismal 19 miles per gallon in the city, worse than some sports cars. Keeping the 300 gassed up costs you a lot of money.
Chevrolet Suburban
The Suburban has been around for a while — it was first released back in 1935 as the Suburban Carryall — and is still in production today, making it the longest continuous use of a model name in the entire auto industry. Today it’s the quintessential SUV, with a ton of interior space for cargo and passengers.
“The Chevrolet Suburban is an American car that may not be the best fit for retirees because it tends to be costly to maintain, even though it has lots of space inside and interesting features,” said Erin Kemp, consumer advocate at Bumper, a car history report provider.
The average annual maintenance cost of the Suburban is almost $1,000 a year. It also should come as no surprise that the Suburban is not fuel efficient, with a combined rating of 16 mpg.
Ford Mustang
The iconic American muscle car, Mustangs have rolled off the Ford line for almost 60 years. A Mustang isn’t practical, although they are surprisingly affordable, starting at around $32,000 for the new 2024 model year.
While there’s nothing wrong with having a fun car in retirement, there are several practical reasons for retirees to steer clear of it, according to Rob Dillan, the founder of car blog EVHype.
“The Mustang’s appeal is undeniable,” Dillan said, “but its higher insurance rates due to its performance nature might not be ideal for retirees. Fuel economy for the V8 models hovers around 15 mpg city, adding to the long-term costs.”
Chevrolet Aveo
You won’t be able to find an Aveo new, as their last model year in the U.S. was 2011. Marketed as an economical subcompact, there’s no denying that Aveos were and are cheap. Unfortunately, that applies to the quality of the car as well as the price.
“Despite its affordability, the Aveo suffers from numerous quality control issues, including engine troubles, suspension problems and interior wear and tear,” said Heim Levi, the managing director of car enthusiast site AutoAlmanac. “Its lackluster safety ratings further compound concerns for retirees prioritizing their well-being on the road.”
Dodge Caliber
Another inexpensive compact, the Dodge Caliber also saw its last year of production. While the design of the Caliber was ahead of its time, similar to the small crossover SUVs that are so popular now, it was plagued by reliability and longevity issues. While at least one car blogger thinks the Caliber is now “so bad it’s good,” that’s probably not the case for retirees.
“Criticized for its cheap interior materials and lack of refinement, the Caliber’s reputation for reliability is dismal,” Levi said. “Owners often report problems with the continuously variable transmission (CVT), engine overheating, and electrical malfunctions.”
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