I am not a huge fan of purchasing extended warranties. For me, nine times out of ten, they are a wasted expense. There have only been three times in my life that I have purchased an extended warranty, and only one product that I will purchase an extended warranty for in the future.
My first extended warranty purchase was for my first computer, which I still have, quitely serving pages from the basement. During the life span of this PC, we have only has one hardware problem – the power supply. Much to my chagrin, this (HP) computer required a proprietary power supply due to space constraints. The cost to me would have been $130. The alternative would have been switching out the case, for as little as $30 and using a standard power supply for about $35. I was not out any money for the new power supply, but I was still in the hole for $170 on the warranty. I have never purchased another extended warranty on consumer electronics, nor have I had a problem with any of them while they would have been covered by the warranty.
I have also purchased an extended warranty on every used vehicle I have purchased. Incidentally, all of these vehicles were for my wife, and I/my parents have paid a grand total of around $2500 for all three vehicles I have ever owned. Both of these warranties have paid for themselves and then some.
The first car we bought for Beth was a 1998 Dodge Neon. This was a necessity as her vehicle at the time was quite literally falling to pieces. The final straw was when Beth had a flat tire, and when they put the car on the lift, chunks of rust/chassis fell from the bottom on the car. Beth was eight months pregnant at the time, and having a four door car instead of a sports car was also going to be a necessity. We had quite a few adventures in this car, the best of which being when the windshield wipers went out in the middle of a blizzard while we were in the middle of the Appalachian mountains. (I used a snow brush as a makeshift wiper and drove the next hundred miles with my arm out the window. There were several minor repairs over the time that we owned this vehicle that made the warranty purchase for this vehicle worthwhile.
Beth’s dream car has always been a mini van. When we found out that she was expecting again, we decided we needed something larger. I gave in, as I do quite frequently with my wife, and we purchased a Dodge Grand Caravan. The van we purchased was the trade in of the people who left as we were coming in. It was exactly what we explained to the salesman that we wanted, and they even let me test drive it before they had a chance to clean it up. I could tell from the test drive that there were going to be transmission problems, so i made sure to purchase a thorough warranty. Less than a month after we purchased the vehicle, the transmission went bad, and was replaces under warranty, nearly doubling the return of the warranty.
The van has been acting up, so we brought it in for service. I had not thought about the warranty for nearly two years. I dug though the paperwork, and discovered that the van was only 1000 miles away from the warranty expiring. Again, it was fixed with no glitches. To date, this warranty has paid for itself nearly three times over.
I have never not had a warranty pay for itself with a used car purchase. Altogether I have had over a 200% return on the investment of purchasing a warranty. With the rising gas prices, and the fact that RJ is almost out of a car seat, we are fathoming the purchase of a new, more efficient, vehicle. If we do decide to purchase a new to us vehicle, or maybe a brand new vehicle, I will be sure to purchase an extended warranty.