Do Car Warranties Save You Money?

Many people feel that purchasing an extended warranty when buying there new vehicle is a sham, most consider only sticking with the standard manufacture''s warranty. Typically manufacturer warranties are good they usually don''t last as long as the auto financing contract. This presents a problem to many new and used car buyers because they are risking the car having a major break down before it''s paid off, possibly causing financial hardship that they were not aware of at first. Perhaps it''s the euphoria or angst of negotiating the new car deal that makes then overlook this option or they are afraid of increasing the monthly payments, over extending their monthly budget.

One thing is for sure; every auto mobile sooner or later will need a repair, whether it''s a few months after you''ve purchased it or long after the manufacture warranty expires it can be catastrophic to your monthly budget. A survey conducted by Bankrate.com in 2006 before the economy began to collaps e, said that too many American''s were ill prepared should a financial emergency were to arise, it went on to say that "Too many people are living paycheck to paycheck, or they''re people who don''t manage their money well. And there are a lot of people who just don''t know any better."

The ability to handle a sudden financial emergency such as an unexpected major automobile break down, one would be expected to have at least three months living expenses available. Ideally six months would be better.

Where the problem lies with any major mechanical break down is the repair costs. Should your air-conditioning unit fail you could be looking at potentially a $1,200.00 repair. Have the automatic transmission fail and you''re looking at close to $3,000.00, driver train another $1,900.00 repair. Too many people do not have enough money set a side for an unexpected auto repair, such as the ones I just stated causing further distress to their financial situation. No one likes to worry about which bill they should skip in order to help them pay for this unexpected repair. It''s feasible to assume that by not being able to afford a costly repair, you''re suddenly thinking about not making that auto loan payment now. I mean, who really wants to pay for an auto that is no longer running?

This type of situation can be totally avoided with purchasing an extended auto warranty. The advantages over buying a warranty and what you''ll save should you need a major repair seem to out way the cost of the warranty. The peace of mind, knowing that if your automobile does break down and you won''t go broke, have to pawn your possessions, or even take out a short term high rate loan from a payday loan source to have your auto repaired.

No one can predict the future, but one thing is certain, automobile mechanical break downs are expensive and the cost of repairs is only going to increase.