Best Extended Car Warranty In South Africa: Is an Extended Motor Warranty a Good Plan for You?
Owning a car in South Africa is both an exciting as well as intimidating experience. It’s exciting in that you have an asset that allows for freedom, independence as well as a mark of progress in your financial life. Daunting in that there are many aspects to consider in terms of finance related to your vehicle – other than your monthly comprehensive insurance.
Adding an extra monthly payable amount may seem reckless for a first time buyer, or those who are wary of their budget, but the implications of not having a plan in place could wreak havoc on the financial stability you have managed to set for yourself.
So, how do you determine when it’s smart to consider an extended warranty?
How to Know if an Extended Motor Warranty is a Good Fit for You
- If replacing the item would lead to financial strain, transfer the risk.
Regardless of the cost of the product or service, an extended warranty should be considered if repairs or replacement could drain emergency cash reserves or increase your credit card debt. You don’t need to decide on an extended warranty right away. You’ll have a period of time, usually 30 days from the date of the transaction, to add coverage. Review what is covered under the standard warranty; for example, most services and goods will carry some form of protection or replacement for at least a year. If a major repair or replacement has the potential to place your household balance sheet in jeopardy, then it makes sense to transfer the risk to the manufacturer and pay for protection.
- The bigger the purchase, the greater the consideration.
Durable goods like refrigerators, televisions, dishwashers, washers and dryers all come with standard warranties. Extended protection may not be required, as these items don’t break down frequently.
However, before you say no, remember that when comparing the price of replacement items for household appliances vs a part for your vehicle, there is a massive difference in price, and that a damaged component of your vehicle may render said vehicle inoperable if it is not seen to immediately.
- Remember your savings account.
Managing to get a savings account set aside, and not delving into it for monthly expenses is a feat not known by many. While you might save a few hundred in monthly payments toward an extended warranty, try imagining the setback (both financial and emotional) you would face in the event of an incident which requires a large payment to resolve.
- Buy with your weaknesses in mind.
Purchasing an extended warranty for your motor vehicle is more a “peace of mind” purchase, knowing that if any mechanical or electrical fault occurs, you’re financially safe. Other financial products such as service plans, tyre & rim insurance as well as bodyline maintenance is geared mainly towards those who know they are prone to either forget scheduled services, cannot budget for same, or know they are prone to getting a paint scratch in almost any parking lot. Knowing your weaknesses allows you to better choose the right warranty or plan for your own needs.
Understand your faults and use extended warranties when it protects your purchases against them.