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Extended warranties

Hi Tom and Ray!

I love your show and I like you very much. You both brighten my Saturday and Sunday mornings.

Heeeeereee is my question: My 2004 Volvo XC90 has 75,000 miles on. I drive it about 42 miles a day for work commuting. I have maintained it rather well BUT, big but, for the last two years each time I take it for service I get an awful call from the dealer telling me they discovered something that must be fixed right away, a matter of life or death, so to speak. One time was the module at the driver’s door. All of a sudden I could not roll my window up and down. $625 later I did. Next, the drains in my sun roof were blocked. The “car belly was saturated with water!” $779. All these happen, mind me, as I take it to the dealer for the normal oil change thing. I dread the dealer’s calls.

But I also hate the prospect of a new car payment. I do not want a new car payment. The dealer told me, if properly maintained, I can drive my Volvo up to 300,000 miles. ( I do not know if the dealer tells the truth)

So, I’m considering an extended warranty: the one I looked in is AAA. The dealer suggested it even though he is not an approved AAA repair facility! Go figure?

So AAA offers a Platinum, Gold and Silver protection plan. I’m looking at the Platinum as I’m sick of paying platinum fees for platinum repairs to the dealer.

The Platinum plan will cost me about $4000 and will buy me 40,000 miles guaranteed with a $100 deductible in a non approved facility (aka my dealer) or $50 in a AAA approved facility.

So what do you suggest? In the absence of an extended warrantee I spend about $1,500 annually to maintain that car.

Thank you so much,


You don’t want car payments, but you’re willing to spend the cost of a decent used car($4k) for an extended warranty?
If you’re driving 10~11k miles each year, then that’s equivalent to $1000/year for that warranty, which is what you’re already spending on maintaining the car itself.

So now, your choices are, keep chucking money at the car at the dealership, find an independent Volvo mechanic in your area, or buy something cheaper to maintain.

You need to find a new mechanic or start doing some of the work yourself. I agree with the other guy, you will spend for a warranty what you are spending now.

I have a 20 yr old truck and spend less per year than you spend in one visit. Mostly cause I enjoy doing the little stuff myself and cleaning out the drain lines in a sunroof takes about 10 mins.

You call it a “AAA” protection plan, but I can’t find it on the “AAA” web site. Are you SURE this is backed by AAA? You’ll be paying a lot, regardless, and you’ll get less, on average, back in benefits/repairs. If you need a reliable car, get a new one.

ps - of course your car can last 300,000 miles, any car can, it just takes money. Unfortunately your Volvo is rated ‘much worse than average’ in the Consumer Reports reliability survey. So it may take LOTS of money to get there with your Volvo.

Edit - I saw the mid-Atlantic AAA has this. So that’s better than most 3rd party warranties that cause lots of consumer problems. Still not a good deal on average.

Just put the $4k in a savings account.

Well any car can have major expensive repairs.

The profit to the salesman and company is usually over 50%. So for every $1,000 you spend the insurance company has less than $500 to pay for repairs or they will loose money, something insurance companies do not do. Some people will get nothing back and some will get a lot more than they pay.  Most will get far less. In addition you need to keep in mind that the insurer has worded it to eliminate as many expensive things as they can.

Remember that the seller is out to make money and they get to write the rules and set the price.  They are not going to sell them at a loss so one way or another they are going to have you pay more than they will pay out.  

Would you gamble with a car dealer who gets to set all the rules and knows all the odds?   

Your decision has to do with the value of the piece of mind it gives you. If that is worth the cost then buy it. Don't expect it to cover everything however, most are written to keep cost down and exempt what they know will cost them money. 

Good Luck

Thank you very much for your reply. Finding an independent Volvo mechanic in my area sounds like a winning choice. Do you have any suggestions how can I go about searching for one? I live in Havertown, PA in Delaware county.

Also why do you think an independent mechanic will be cheaper than the dealer?

Thanks again,

Why C&C don’t put this link on every page, I don’t know, here’s their mechanic finder, I’ve used it several times successfully:

And independent mechanics are almost always cheaper than the dealer, lower overhead, etc.

Thank you so much for taking the time to reply. You made a couple of good points. I would love to do some of the work myself, the problem is?..I would not have a clue that a. the drain lines in the sunroof were clogged b. where are they located within the sunroof frame c. how to unclog them(:-
I’m sure you have deduced by now that I am not mechanically inclined, to say the least. To say the most, I’m a female and by this I don’t mean to insult all those great females who know how to change their flat tire in the middle of the road. More power to them, unfortunately I don’t possess these life-saving skills.

I would love to locate an independent, honest, competent and customer-friendly mechanic :slight_smile: Do you have any suggestions how to find one? I live in Havertown, PA 19083.
Thank you

Thank you again!

I clicked on that link and found some good leads. I also noticed that a lot of the leads are owners of gas stations. Do you think I will be better off using a dedicated car repair shop instead of one that sell gas and fixes cars as well?

Thank you

thank you for your reply and I agree with you. Next time I’m ready to buy a new car I will definitely purchase and read the Consumer Reports reliability survey.

Good advice. Thank you :slight_smile:

thank you very much for your reply. I agree and decided to do some legwork and search for an independent mechanic.

It all depends on the skill and experience of the mechanic, one could be at a gas station. If it were me, I might drive by a few top choices and see if the work areas were fairly clean and well organized.

Thank you for your very useful feedback and your time.

Are you a gambling girl ?
So called “extended warranties” are simply a savings account gamble. Just an insurance policy for car repairs.
As others have said, if you can afford to pay THEM, you can afford to pay YOU into a repair svings account.

The gamble is ;
Should you need repairs that are more than your savings you’ll need to come up with the rest. The insurance policy would pay out the larger total.
But, if you never use the insurance policy your money is lost.
If you never use your repair savings account your money is…YOURS.

You may not currently be car savy but you can learn.
Try an auto repair course at the community college.
When you find a good indy mechanic , ask them to clearly explain what they’re doing and why, so that you can learn.
“you can do it, we can help.”

Put the $4000 in a seperate bank account and call it “car warranty account”. Then if something should break over the next 40,000 miles you’ll have a “warraty”, and if not you’ll have a vacation fund.

Put the money in YOUR bank account in case you break dwn and you get to keep it. Send it to them to put in THEIR bank account in case you break down and you’re unlikely to ever see it again.

Hey Ken!

I enjoyed your reply; very original.

No, I am not a gambling girl. If you told me, gamble tonight and you will either win a $1000 or lose a $100 I will decline from fear of losing my $100, that’s how lame my risk tolerance level is.

I love the idea of opening a car repair savings account; I will do just that.

Here is where it gets scary?I read my car’s reviews on the cars. com site?nearly three out of ten had to replace the transmission, some of them with mileage as little as 38,000 miles. Ouch!!! That costs $5,000. Knock wood?I have 75,000 miles on the car and the transmission feels ok. So what you’re saying is?if I have to change the transmission down the road I will use the $4,000 that otherwise would have paid for an extended warrantee plus put up another grant. See? Now that feels more like gambling. I think I can handle it. I learned to love my old car because it cost me $831.76 in monthly payments for five straight years in a row.

Are you saying community colleges offer auto repair courses??? I get regular mailings from them soliciting me to get the next course on line dancing, or wine making but never, ever an auto repair course. The day my local community college decides to do this it ought to get rich!

An indy mechanic and a good one at that? I love this expression. Never thought of an auto mechanic as indy, but hey, why not? I vow to be on the prowl until I locate one.

Thank you Ken,

I, so agree with you mountain bike. Why didn’t I think of this on my own??? It makes so much sense.

Thank you so much!

One way to try out different shops is to simply go in for an oil change and see how they treat you.
Do they take your keys, drive the car in, change the oil and hand them back?
Do they drive it in the bay, pop the hood, come in with a dirty air filter and say “your filter needs changed, we can do it for you for $40 more.”, go back to the car, then come back in telling you you need X and Y parts new(this actually sounds like your dealership)?
Do they ask you how long it’s been since X and Y have been done and give you recommendations on what should be done at the mileage you’re at?
Do they push deals where they have some kind of additive(for only a few dollars more) that they insist is the best product for your car since gasoline was invented?