Why You Should Buy an Extended Warranty

 

Buying a car can be a big moment in anyone’s life. It’s no small investment. Whether you’re purchasing a vehicle for yourself or your children, you will want it to be protected. We’re sure you’ve heard the term, “extended warranty or Vehicle Service Contract.” But how does it affect you as a car-owner? Purchasing an extended warranty is similar to buying life insurance for your car. We’ve made a list of why extended warranties can truly help you when it counts.

 

1. Protect your car after the factory warranty ends

New cars come with a factory warranty, an arrangement that holds the car manufacturer responsible for the cost of parts and labor associated with vehicle defects. Warranties are limited by time and or mileage. Most commonly, factory warranty will last up to three years or 36,000 miles but some can be longer. However, on average, people are keeping their cars longer these days.

 

According to Automotive News, the average age of cars on the road in 2016 was 11.6 years old. That’s obviously far longer than a typical factory warranty lasts. So, what happens when it runs out? Your car will go unprotected for the costs of parts and labor for as long as you own it.

 

Think of an extended warranty as repair insurance once the factory warranty ends. Even if you’ve read our previous blog posts and keep your car in mint condition, it only takes one mechanical issue for the bills to start adding up. Instead of being protected for 36 months, why not feel safe for the car’s entire life span?

 

2. Extended warranties offer additional coverage for both New and most PreOwned Vehicles

It is worth noting that when your car needs repairs, you may need a rental to carry on your day to day activities. And rental prices can be high, averaging at about 50 dollars a day for economy cars. With the proper extended warranty, a rental or loaner car will be discounted or covered. That is just one example of a multitude of additional perks falling under extended warranties. Others include, free towing, lost-key lockout services, 24/7 roadside assistance, and benefits that help pay for breakdowns far from home.

 

3. The Price of an Extended Warranty Increases as the Car Ages

This is where when you buy a warranty comes into play. Extended warranties, like life insurance, increase in price as your car increases in age. When you’re buying a new or PreOwned vehicle from the dealer, think about how long you want to be driving the car. If you expect to own or drive your vehicle for longer than the initial warranty coverage, you will want to seriously consider buying an extended warranty right then and there. Even though it will only go into effect after the factory warranty ends, it will likely be much more expensive to purchase at a later date. Buying early saves money. In addition, the cost of the extended warranty can be put into your monthly payments rather than you having to pay in full years down the road.

 

4. Increase Your Car’s Resale Value

Let’s say you’ve driven your car for years but want to sell it before the extended warranty is up.  The fact that you still have a working extended warranty can come in handy for resale. When someone decides they want to buy your used car, in most cases you can transfer them your extended warranty, sometimes for a small fee. It’s likely that the potential buyer will feel more comfortable buying a used vehicle that comes with protection in case anything happens. An extended warranty will add value to your vehicle and will justify a higher price.

 

5. Not All Extended Warranties are Created Equal

Be VERY careful when purchasing an extended warranty. Make sure you buy from a trusted source and make certain you understand exactly what the warranty covers (and does not cover). Be VERY careful of online or telephone extended warranty solicitations, there are many unscrupulous solicitors out there.

 

If you’re thinking about hitting the road this summer (road trip!) and want to be as ready as possible, check out our latest article on Summer Car Care. Prevent breakdowns and instead enjoy the open road. Have fun!

 

 

Posted in Car Tips | Comments Off on Why You Should Buy an Extended Warranty