Extended Vehicle Warranties: Why You Should, and Shouldn’t, Buy One
Whether you buy a new car or a previously owned car from a Chevy dealer near Albany, NY, you are making a significant investment. You want to be sure that your new vehicle will last you many years to come so that you won’t have to replace it in just a few short years.
You also don’t want to have to spend thousands of dollars in repairs over the life of the vehicle.
Doing your research and finding the best model vehicle to fit your budget is one of the best ways to ensure you are making a good investment. While there are never any guarantees, you can feel confident buying a car that has a reputation for safety and reliability thanks to extensive testing and reports from consumer experiences.
Getting the right maintenance can also help you extend the life of your vehicle, such as opting for the higher-quality synthetic oil change instead of the regular or choosing fuel and engine additives to enhance performance.
Another option is to invest in an extended warranty, which you will likely be offered when you buy your vehicle. Here are a few reasons why you should consider getting the extended vehicle warranty — and a few reasons you might want to skip it:
Warranties Protect against the Unknown
Even if you have extensively researched your options and bought the best-rated vehicle on the market for safety and performance, you never know what will happen.
Your alternator could malfunction after a few months of owning the car thanks to a faulty part or shoddy installation. After-market testing could show that an airbag doesn’t deploy when it should because of an error in programming.
Having the extended vehicle warranty protects you against these and other unexpected problems. By choosing the extended warranty, you get protection long after that initial warranty is over, ensuring that you aren’t taken by surprise by issues down the road.
Warranties are Great for Used Cars
Extended warranties are ideal for used cars, which may have enough mileage on them that their parts are aging out and they are starting to experience problems. In your research, you may have also found that the vehicle you are considering buying has a known problem later in life, such as the timing belt malfunctioning on many models after 150,000 miles.
By purchasing the extended warranty, you protect yourself in case your car develops a common problem or another unexpected issue.
You Can Save Money on Repairs
A single repair such as a new transmission or a new alternator can cost hundreds or thousands of dollars. Depending on the terms of your extended warranty, those same repairs could cost you nothing.
An extended warranty could end up saving you a lot of money over the years, depending on how many problems your car experiences. The warranty could end up paying for itself many times over.
You Can Roll the Price into Your Loan
In most cases, you do not have to pay for your extended warranty up front. Instead, you can include the cost of the warranty in the overall amount you are financing to pay for the car. While you may pay a little more for it over time when you factor in the interest, the option to roll it into the loan can make it more affordable for you if you don’t have a few thousand dollars to pay for it outright.
When evaluating the cost of the extended warranty, you need to break it down by the number of years of coverage that it offers and add up the cost of anticipated repairs. You can quickly see how much it can save you even if your car only needs an average amount of repair.
You Might Not Use It
Honestly, it seems like the rare case that a vehicle would not need any repairs once it gets into the mileage range than an extended warranty covers. However, that possibility exists. You could end up paying several thousand dollars for the extended warranty and never actually use it. If you rolled the warranty into your auto loan, that means you also paid more for your car each month than you needed to pay.
Unfortunately, any kind of insurance is really a gamble. You never know if your car will need repairs, or if you’ll just need routine maintenance like a synthetic oil change. Meanwhile, you never know if you’ll need to have a root canal or get an emergency tooth extraction of if you’ll just need routine dental cleanings. But don’t you feel better knowing that you have dental insurance in case of that emergency? Think of your extended warranty in the same terms.
No one can tell you definitively if the extended warranty is worth it or if you’ll definitely use it. You have to evaluate your own tolerance for risk and knowing how you would feel in case your vehicle needed serious repairs.
You Can Save for Repairs
Some people argue that instead of getting an extended vehicle warranty, you can just put that money aside for potential repairs. That way, if your car does need repair, you have the money ready and won’t be blindsided by the problem. However, if your car doesn’t end up needing repair, you’ll have a nice little sum to buy your next car or to do something fun, like take a vacation.
Again, this is a gamble. The amount you save might not actually be enough to cover repairs. In many cases, the repairs the extended warranty covers cost much more than the warranty did.
By choosing to save, you are also taking a gamble that you will actually save the money. You might have the best intentions, but when you don’t have a bill with a deadline to pay and you have other demands on your finances, you might be tempted to use the money for something else and not save it.
Only Specific Issues are Covered
Extended warranties don’t cover every kind of repair your vehicle might need. Some warranties may cover only certain parts of the engine or repairs caused by certain problems. You can also void your warranty if you are negligent in your handling of the vehicle or if you don’t stick to the recommended maintenance schedule with the recommended service providers.
Read the extended warranty carefully to know exactly what it covers before you decide if it is a good buy for you.
In some cases, you may be able to protect your car just by driving it safely and getting the right maintenance on time. Choosing advanced level services like a synthetic oil change can also provide your car more protection, giving you many more years and miles on the road.
However, the extended vehicle warranty does offer many benefits, and it can protect you for many unforeseen issues that your vehicle might have, even if you do take great care of it. Carefully review the warranty and weigh all the pros and cons in order to make a sound decision. You could protect your car and your pocketbook at the same time.