A prepaid car maintenance plan's an add-on feature that covers the expected maintenance your car will require when you own it. Typically dealerships will offer you a prepaid car maintenance plan as well as other extra-cost options such as extended warranties, credit insurance and anti-theft devices while at the showroom.
The the easy way determine if a prepaid maintenance plan's the right financial selection for you is to research expected maintenance costs for the vehicle and compare that with the price you•re offered.
What is a prepaid car maintenance plan?
A prepaid car maintenance plan is an agreement that covers scheduled maintenance for any car on the set number of years. A prepaid car maintenance plan isn•t just like a long warranty, which provides coverage for certain unexpected repairs when the factory warranty expires • instead, it covers the expense of specific, scheduled preventive maintenance listed in the vehicle•s owner•s manual, for example tire rotation and oil changes.
Prepaid maintenance plans may enter the discussion when you are purchasing a new vehicle that doesn•t have scheduled car maintenance included in the list price or when purchasing a used car no longer covered.
Several manufacturers, for example Jaguar, Toyota, BMW, Volvo, MINI and Land Rover, all offer prepaid maintenance plans. Some of these factory plans also include wear-and-tear items, for example windshield wiper blades and brake pads, but some don•t, and that's why it•s critical to seek information before going to the showroom.
Are prepaid maintenance plans worthwhile?
As with most aspects of the car shopping process, doing the math before seated with the dealer is paramount to saving cash. To determine if a prepaid car maintenance plan is the right choice for you personally, you must compare the cost of the program with the estimated cost of the scheduled or out-of-pocket costs throughout the coverage period.
Your owner•s manual should detail the particular maintenance you•ll need and the intervals at which you•ll require it. To find specific costs, you can call the dealer service manager and ask for a breakdown of scheduled maintenance costs. Edmunds also offers a maintenance cost calculator along with a cost-to-own calculator that can help you determine the scheduled maintenance costs for particular models at typical service intervals.
If the estimated cost for scheduled upkeep of your brand-new car because of its first 30,000 miles is $400 and you•d pay $800 for the plan, a prepaid car maintenance plan's ultimately not worth it. If you•d pay $250, on the other hand, it•s a savings.
Pros and cons of prepaid car maintenance plans
There are some factors that you ought to weigh when deciding if your prepaid car maintenance plan is best for you.
- Prices for covered services are kept in.
- Customers with prepaid maintenance plans normally have the convenience of the express checkout when picking up their vehicle.
- Prepaid costs might be discounted when compared with normal maintenance costs.
- Service intervals may not match those required in the owner•s manual.
- If you're financing the car purchase, you pay interest on the plan cost.
- Service must be performed at the dealership where you purchased the vehicle.
The bottom line
For some drivers, a prepaid car maintenance plan removes future car-related headaches by cutting out the decision making. But for those who curently have a good relationship with a body shop, it might not be worthwhile to pay ahead and be locked into the dealership service team. To find out whether a prepaid maintenance plan will benefit you, take the time to research expected costs and compare that figure towards the plan cost offered to you.