Are Extended Warranties for Autos Worth It?

[cyclonemagic]

Are Extended Warranties for Autos Worth It? I just bought a new 2023 Subaru Forester Limited with all the bells and whistles. It was highly rated as reliable with lots of safety features. It replaced my wife's 11-year-old Hyundai Elantra with 180k miles, which got totaled in an accident. I turned down the 7-year extended warranty offered by the dealer despite the fact that I was able to negotiate the cost much lower. The Subaru (and most other vehicles we considered) are technological wonders compared to the car it replaced. I am wondering if cars are more prone to maintenance due to all of the tech especially computer chips placed in the vehicles to maintain the safety features, cvt transmissions, etc.

In general, I do not believe in and buy extended warranties for autos or electronics. I assume if you purchase a reliable card and maintain it, it should give you many years of service. I usually buy new cars. On average, we keep our cars for 10 to 12 years. I usually notice issues beginning in year 10. Our other car, an eleven-year-old Hyundai Sante Fe, had its first major issue in year 10. The alternator had to be replaced. That was followed by a front axle issue in year 11. In the past month, we just had to replace the headlamps and low tire pressure sensor. The Sante Fe was consider to be a premium model / trim when it was purchased. But nothing compared to the cars being sold today. Is it possible to own the new generation of cars for 10 years without much major maintenance and / or need for an extended warranty?

 

[cycloner29]

Daughters 2017 Chevy Cruz had the engine expire at 63,000 miles. Typical that the GM warranty had expired last year already. She bought the used with like 55,000 miles on it. Engine replacement is like $8,000. In this case, so thankful she got the extended warranty!

 

[AuH2O]

Are Extended Warranties for Autos Worth It? I just bought a new 2023 Subaru Forester Limited with all the bells and whistles. It was highly rated as reliable with lots of safety features. It replaced my wife's 11-year-old Hyundai Elantra with 180k miles, which got totaled in an accident. I turned down the 7-year extended warranty offered by the dealer despite the fact that I was able to negotiate the cost much lower. The Subaru (and most other vehicles we considered) are technological wonders compared to the car it replaced. I am wondering if cars are more prone to maintenance due to all of the tech especially computer chips placed in the vehicles to maintain the safety features, cvt transmissions, etc.

In general, I do not believe in and buy extended warranties for autos or electronics. I assume if you purchase a reliable card and maintain it, it should give you many years of service. I usually buy new cars. On average, we keep our cars for 10 to 12 years. I usually notice issues beginning in year 10. Our other car, an eleven-year-old Hyundai Sante Fe, had its first major issue in year 10. The alternator had to be replaced. That was followed by a front axle issue in year 11. In the past month, we just had to replace the headlamps and low tire pressure sensor. The Sante Fe was consider to be a premium model / trim when it was purchased. But nothing compared to the cars being sold today. Is it possible to own the new generation of cars for 10 years without much major maintenance and / or need for an extended warranty?

If something is going to make it pay for itself it’s probably electronics problems more than mechanical systems, at least with a Subaru. I bought one and got the wheel tire, paint and windshield replacement and upholstery. It was in two packages that totalled about $1800. Paintless dent, paint scratch, windshield and sensor calibration, and upholstery repair, and tire/ wheel replacement. Not sure if it will pay, but having no deductible on door dings, windshield replacement and all that it makes me feel better.

 

[mramseyISU]

It depends on the vehicle you're buying really and how long you plan on keeping it. Subarus are known to eat head gaskets so maybe look into what a replacement for those will run you and compare that to the cost of the warranty before making a decision on if you need it or not. If you buy a Range Rover then you want the warranty.

 

[KennyPratt42]

On the aggregate you lose money on extended warranties, that’s why they are priced where they are and are highly profitable items for dealerships to sell (along with vehicle protection accessories that are often highly marketed up). However, if the peace of mind is worth it I won’t fault someone for getting one, it’s just not for me.

If you are going to buy one you can almost always find other dealerships for that brand (have to look nationwide online) that will sell the identical warranty from the manufacturer for far less than the dealership you buy the vehicle from will sell it for. The model is they sell a ton of warranties for a small markup versus a smaller number of warranties for a moderate (usually what the ‘good deal’ at the dealership is) or large markup.

 

[KnappShack]

I always thought of it as prepaying for repairs. That's not something I like to do.

Cars are built much better now and I try to choose vehicles with a good track record.

Still remember my first car purchase out of college. Sales guy was working me over hard for the extended warranty.

I finally said, "Are you telling me there's something wrong with this car? Maybe I need to reconsider"

I was basically thrown out of his office

 

[KennyPratt42]

I always thought of it as prepaying for repairs. That's not something I like to do.

Cars are built much better now and I try to choose vehicles with a good track record.

Still remember my first car purchase out of college. Sales guy was working me over hard for the extended warranty.

I finally said, "Are you telling me there's something wrong with this car? Maybe I need to reconsider"

I was basically thrown out of his office

The finance manager (or whatever that particular dealership calls it) is often the best salesperson and usually the most assertive one there. I’ve probably bought too many cars in my life, but it almost always involves a 10 minute period that is fairly uncomfortable of me saying no to financing vs. paying cash, extended warranties, gap insurance (if I did finance because of 0% or 0.9% promo rates), vehicle protection, etc. The weird/funny thing to me is they’ll often get kind of grumpy/terse/stop smiling once you start saying no to everything then as soon as all the paperwork is over they are back to friendly and smiling.

 

[TheHelgo]

IMO it depends on whether you are buying brand new or pre-owned. My wife and I bought a brand new Jeep Grand Cherokee and we turned down the extended warranty. Alternately, we purchased pre-owned Yukon that was about 5,000 from its factory warranty. We did add the extended on that, as we have really no idea what the prior owner did or experienced.

 

[Clonehomer]

If they were worth it, they wouldn't try so hard to sell you one. In general on a new car if something is going to break, it'll break early during the manufacturers warranty. After that, things will last until they wear out. There are certainly anecdotes of situations where it saved money. But on average, they're costing more than they save.

But that being said, such is the same with things like homeowners insurance. Most people will pay in more than they'll ever get out of it. So really it depends on how much risk you're willing to take. Play it safe and know what your expenses will be, or take a chance to save some money with the thought that there's a small chance you're going to have to pay more.

 

[ruxCYtable]

This is my extended warranty

 

[HFCS]

If they were worth it, they wouldn't try so hard to sell you one. In general on a new car if something is going to break, it'll break early during the manufacturers warranty. After that, things will last until they wear out. There are certainly anecdotes of situations where it saved money. But on average, they're costing more than they save.

But that being said, such is the same with things like homeowners insurance. Most people will pay in more than they'll ever get out of it. So really it depends on how much risk you're willing to take. Play it safe and know what your expenses will be, or take a chance to save some money with the thought that there's a small chance you're going to have to pay more.

It’s almost certain the full price warranty is a ripoff, but also certain at some point arguing it down to a discounted price that it’s a good value at some price.

 

[Cyfan1965]

I bought one and only one on the Dodge Journey because the car was a POS and I knew it. My wife liked the ride third row seat.... After the third fuel oxygen sensor at less than 60,000 miles all covered. Only unfortunate thing now is my wife wants to buy the extended on every car we buy based on that abomination.

 

[nrg4isu]

Insurance of any type is by definition a losing proposition on average. If you have the money to replace the car, it's 100% not worth it.

 

[drmwevr08]

It's important to know, you can negotiate the price.

 

[KnappShack]

The finance manager (or whatever that particular dealership calls it) is often the best salesperson and usually the most assertive one there. I’ve probably bought too many cars in my life, but it almost always involves a 10 minute period that is fairly uncomfortable of me saying no to financing vs. paying cash, extended warranties, gap insurance (if I did finance because of 0% or 0.9% promo rates), vehicle protection, etc. The weird/funny thing to me is they’ll often get kind of grumpy/terse/stop smiling once you start saying no to everything then as soon as all the paperwork is over they are back to friendly and smiling.

Last guy kept trying to steal the rate. I'm very rate sensitive. He was trying that payment sales move. Look! I can get you floor mat replacement and a warranty for next to nothing.

What's that do you my rate?

Well ......

 

[0u812]

hell no. Pre pay for repairs?

 

[2122]

Insurance of any type is by definition a losing proposition on average. If you have the money to replace the car, it's 100% not worth it.

Plus they try their hardest not to pay claims, so it is a hassle.
Pass on insurance whenever possible.

 

[TitanClone]

No. I got 1 on my current car and 100,000 miles later I haven't had to do anything outside of oil changes and new tires. That said I essentially got it for free, agreed on a price then they tried to sell it to me for like $2k. Talked it down and ended up adding like $3/month to my payment so $180 over 5 years.

 

[brianhos]

Are Extended Warranties for Autos Worth It? I just bought a new 2023 Subaru Forester Limited with all the bells and whistles. It was highly rated as reliable with lots of safety features. It replaced my wife's 11-year-old Hyundai Elantra with 180k miles, which got totaled in an accident. I turned down the 7-year extended warranty offered by the dealer despite the fact that I was able to negotiate the cost much lower. The Subaru (and most other vehicles we considered) are technological wonders compared to the car it replaced. I am wondering if cars are more prone to maintenance due to all of the tech especially computer chips placed in the vehicles to maintain the safety features, cvt transmissions, etc.

In general, I do not believe in and buy extended warranties for autos or electronics. I assume if you purchase a reliable card and maintain it, it should give you many years of service. I usually buy new cars. On average, we keep our cars for 10 to 12 years. I usually notice issues beginning in year 10. Our other car, an eleven-year-old Hyundai Sante Fe, had its first major issue in year 10. The alternator had to be replaced. That was followed by a front axle issue in year 11. In the past month, we just had to replace the headlamps and low tire pressure sensor. The Sante Fe was consider to be a premium model / trim when it was purchased. But nothing compared to the cars being sold today. Is it possible to own the new generation of cars for 10 years without much major maintenance and / or need for an extended warranty?

I added the extended warranty to my wifes 2022 Subaru. It has big time electrical problems already and there is no way I would go without warranty coverage on this car. It was only $1500 to extend the 3 year warranty to 10 years. Seems like 1 issue would be well over that.

 

[BryceC]

I always say no to this, but I had a pretty funny experience this summer. I found out the differential went out on my truck which I bought new, and the factory warranty had expired. I got an email like 2 days before the car guy told me the differential needed replaced saying I could sign up for the extended warranty. I got told the bill would be like 2,300 bucks and while I was in the dealership I filled out and got approved for the extended warranty. Cost me 500 instead and I cancelled the warranty the next month. Glorious