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, Fri, 20 Mar 2009 03:49:13
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I spent a lot of years in the car business and the desire to be covered cradle to grave motivates people to do things that don't really make a lot of sense like buy a new car long before they really should or buy extended warrenties. By and large the reason people think this way is that they are used to making a large car payment which is why the prospect of an unexpected repair bill is so daunting. Because of the fear they might suddenly have to come with with $300 or $400 or $500 they think it makes sense to buy a new car for $300 or $400 a month for 5 years. $300 a month is $3600 a year--you'd have to work really hard to spend that much on maintenance even on a car with 150,000 miles. Anyone who has spent time in the car business knows that depreciation is the big expense when it comes to cars and repairs are dirt cheap in comparison. Like a lot of people on this board I buy Saabs with 100K on them. I pay cash so I don't have a payment. Typically I spend $600 to $800 a year on repairs. There is always the possibility of a large repair like a transmission, but if you average it out over several years it still comes out to $600 to $1000 a year including wear items like brakes, tires etc. Assuming you bought new and financed it for five years, you should have it paid off in two years. You shouldn't have much in repairs between now and then. When it's paid off set up a maintenance fund of say $200 a month then you won't be ambushed by anything. Odds are you find you don't spend anywhere near that much, but you'll have the peice of mind that if anything goes wrong you'll have the money to pay for it. The difference between that and an extended warrenty is that whatever you don't spend is yours to keep.
posted by 24.247.176...
, Fri, 20 Mar 2009 03:49:13, Fri, 20 Mar 2009 12:19:44
, Fri, 20 Mar 2009 11:54:47, Fri, 20 Mar 2009 05:51:05, Fri, 20 Mar 2009 06:57:02
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