Extended Warranty on a Car: To Buy or Not to Buy

By: Vincent Mortensen

I recently purchased a used car at a dealership for a fairly good price. Once it was time to create a payment plan, the financial consultant asked if I would like a two-year, 24,000 mile extended warranty on the vehicle for $1,850. In order to not sound biased, I won’t reveal if I purchased this warranty plan.

Many of us feel sick if we are not protected from potential problems while many of us feel all warranties are a complete rip-off. On which side to you lie? Is it ever a good or bad idea to purchase an extended warranty for a vehicle? Below are a few points to help you make a more clear choice.

1. How long do you plan on keeping the car? – Are you the type that gets tired of cars within two to four years or do you like to use your car until it’s on its last leg? It is generally not a good idea to purchase an extended warranty for those who don’t keep cars longer than four years.

2. Who stands behind the warranty? – If you do choose to purchase an extended warranty, make sure it is backed by the car maker and not just the dealership you purchased from.  Car maker warranties will allow your car to be serviced at any dealership that sells your brand of car, not just at the dealership you purchased. 

3. Have you shopped for the best price? – More often than not, you can find an extended warranty through third-party programs for much cheaper. If you do go this route, make sure you know what you are getting, as the third-party warranty might not cover as many potential problems the dealership will cover.

4. Will you have peace of mind if you don’t buy it? – As mentioned above, there are some people that cannot sleep at night, knowing their car is not covered by a warranty. If you are going to make yourself sick, perhaps you should consider it.

5. Is the car still under the original warranty? – There is no need to purchase unnecessary coverage if your used car is still under the original warranty of the car maker. For example, if you are offered a two year, 24,000 mile warranty from the dealership for $1,850 but your car still has a year and a half or 20,000 more miles (whichever comes first), a warranty would be wasteful. What are the odds your car will have $1,850 worth of problems in only six months? Not likely.

After reading these points, the choice is yours. If you are in the market for a new or used car, make sure you do your research to get the best warranty deal or skip it completely.

This information was based on an article from http://www.edmunds.com

Celebrate College Savings Month!

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September means school is back in the swing of things and you’ve had to fork over some serious cash for books, supplies, and tuition for the semester. Why not start thinking about next year and how you will make covering these expenses less stressful?

The Personal Money Management Center wants to help you reduce stress that is associated with the financial obligations of getting an education. We want to help you so much that we are going to show you how to receive a $4,500 matched savings grant! We are holding two mandatory personal money management classes at the end of December (20th & 22nd 10am-2pm) to qualify you for this opportunity. Class sizes are limited so you need to register as soon as possible. If we have over 40 participants signed up by September 10th, we will hold an earlier session the last two Saturdays in September (20th & 27th).

The classes work in conjunction with the Utah Individual Development Account Network. UIDAN provides a matched savings account to qualified participants. When you save up to $1,500 you will receive up to $4,500; a 3:1 match! Your $6,000 can be used towards your education, the purchase of a first home, small business development, or assistive technology for the disabled.

We have been able to assist students in receiving $112,500 in matched savings money. Students chose to use their funds for education, buying their first home, or starting their own business. You could be the next student to lessen the financial burden of getting a college degree or to make your dream of owning a home or starting a business a reality!

To register for this amazing opportunity, simply call our office 801-585-7379 or stop by to see us on the 3rd floor of the Union in Room 317. We also have an event posted on our Facebook page.