To Extend or Not To Extend--That IS The Question

Consumer Reports, a 70 year old magazine is starting to do something they don't normally do. Starting Monday, ads are going to be run on some major car buying websites, such as caranddriver.com and Edmunds.com. The ads will be showing the magazines stand on extended warranties for new vehicles. A full page print ad will also appear in the Tuesday issue of USA Today. Consumer Reports has been against extended warranties for quite some time, but apparently that isn't enough, which is why they are willing to pay to run these ads. The article mentions a survey the magazine did on extended warranties. "The survey found that warranty buyers on vehicles from the 2001 and 2002 model years paid an average of $1,000 and received $700 worth of repairs in exchange." Vice President of the company that owns Consumer Reports hopes that these ads will better inform the public of the loss of money that comes with an extended warranty.

I have mixed feelings on this. When I really think about it, I understand where they are coming from. It's like car insurance or any other type of insurance you may have (health, home, renters, etc.). You pay so much money a month to be covered if something were to happen, and may not even use the insurance for years. At work, I have $29 taken out of my paycheck every two weeks for medical insurance. Sure, $29 isn't a lot, but then I think about it, and first off, I have an INSANE deductible, and second, I have had this insurance for almost 2 years now....and have yet to go to the doctors, which in all reality, I just lost $696 a year, for a "just in case" insurance.

Now, on the other hand, if something were to have happened to me, I would be ever so grateful that I'm paying $700 a year in medical insurance. Which is why I myself purchased the extended warranty on my new car.