What does Dave Ramsey say about extended warranty?
Instead of buying a bunch of extended warranties that you’ll probably never use, you’re better off self-insuring by paying yourself the warranty payments. That way, if your TV does break after the normal warranty, you have the money saved to fix it. If not, it’s your money to keep. It’s a win-win! The warranty providers design these plans to be profitable. On average, customers pay more for the policy than they receive in covered repairs. Extended warranties are rarely a smart idea, especially if it’s a used car,” according to the consumer advocates at the Public Interest Research Group.As a former dealership service advisor, independent shop manager, and marine/auto repair shop owner it’s even more necessary to have an extended warranty on a vehicle AFTER it reaches 100,000 miles than before. After 100,000 miles parts are closer to the end of their service life.Today, extended warranties represent a global industry worth over $120 billion annually, with profit margins that frequently exceed 50%. For many retailers, these warranties have become more profitable than the actual products they’re designed to protect.An extended auto warranty can provide a lot of benefits, including peace of mind, protection from surprise repair bills and even secondary benefits like roadside assistance. But it also comes with drawbacks. These may include difficulty canceling and the possibility that you won’t ever use the coverage.Based on average repair costs and reliability ratings, a Mercedes extended warranty is a good investment. The J. D. Power 2025 U. S. Vehicle Dependability Study ranks the brand 23rd out of 30 automakers.
What is not covered by extended warranty?
They typically don’t cover damage that may occur in an accident or normal wear and tear to the vehicle. An auto service contract or extended warranty is not a warranty as defined by federal law, because you buy it separately; it’s not included when you buy a car. Based on this data, extended auto warranties cost an average of $1,297 per year across providers, plans, coverage options and vehicles. We also surveyed 1,000 extended auto warranty owners in January 2025. The majority of respondents, 70%, paid between $500 and $2,500 in total for an extended warranty plan.Extended warranties can offer peace of mind, functioning as a safety net for certain purchases. However, many products are reliable, so the cost of an extended warranty might outweigh the benefits.An extended warranty price represents a percentage of the total product cost. As a general rule of thumb, you shouldn’t spend more than 30% of the product cost on a product warranty.Extended warranties for cars over 100,000 miles cost $136 per month or $1,398 per year of coverage on average.
What are the disadvantages of extended warranty?
Conversely, the potential downsides to making this purchase include: Upfront Cost: Extended warranties can be expensive, and you might never use them. Weighing the cost of the warranty against the potential repair bills is crucial. Based on this data, extended auto warranties cost an average of $1,297 per year across providers, plans, coverage options and vehicles. We also surveyed 1,000 extended auto warranty owners in January 2025. The majority of respondents, 70%, paid between $500 and $2,500 in total for an extended warranty plan.Whether you have an extended warranty or a vehicle service contract, you typically have two options—transfer the coverage to the new owner or cancel it for a prorated refund.Like most goods and services, extended warranty policies can come with the option of getting refunds. However, extended warranties — especially automobile extended warranties — are unique entities and, as such, have unique characteristics regarding when and how refunds are available.The benefits of an extended warranty After the manufacturer’s warranty has expired, you may consider taking out an extended warranty on a used car. The advantages of this are that you gain the peace of mind of being able to cover the cost of certain repairs to your vehicle for the period of the warranty.Like most insurance policies, an extended warranty is something you pay for in the hope that you’ll never need to use it. For many owners, it’s worth paying the price for peace of mind; even if your car is built by a brand renowned for its reliability, there’s always a risk that something could go wrong.
Is it smart to buy extended warranties?
Extended warranties are great for people who want to be prepared for possible repairs that may be needed once the factory warranty expires. Keep in mind there is a difference between third party and factory warranties. Once your CPO Limited Warranty expires, the CPO Extended Limited Warranty offers up to 2 additional years (unlimited miles), providing the same comprehensive coverage. For additional details, contact your local Mercedes-Benz dealer.Additionally, you can purchase Mercedes-Benz Extended Limited Warranty coverage at any time prior to the expiration of your original New Vehicle Limited Warranty.Our Extended Warranty product has both a mileage limit and an age limit. In order to take out an Extended Warranty for your Mercedes-Benz, your car must not have completed more than 120,000 miles (or 100,000 miles for AMG and Maybach vehicles) at the start of the policy.Mercedes-Benz new and demonstrator vehicles first registered on or after 1 March 2020 receive a 5 year Warranty period. If you purchased a Mercedes-Benz prior to 1 March 2020, you will have a 3 year warranty. We can extend car warranty coverage on selected Mercedes-Benz vehicles for an additional three years.Plus, your vehicle will also receive the quality of service and genuine parts that can only come from Mercedes-Benz. Additionally, you can purchase Mercedes-Benz Extended Limited Warranty coverage at any time prior to the expiration of your original New Vehicle Limited Warranty.
What’s the deductible for Mercedes extended warranty?
Best of all, purchasing the Extended Limited Warranty means you will have no complicated paperwork to process and no out-of-pocket expenses for any warranty repairs performed by an authorized Mercedes-Benz dealership. No deductible. No hassle. Nothing to interfere with your enjoyment of the road. Mercedes-Benz Extended Limited Warranty No deductibles for covered repairs.How to get your money back. You can cancel an extended warranty at any time and you’ll get a prorated refund for the unused portion of your policy. If the warranty was included in your loan, your car payment won’t drop, but you may pay off the car sooner after the refund is deducted from your balance.Once you sell your vehicle, you may be able to cancel the extended warranty and qualify for a prorated refund. Please contact your warranty provider for details. Any extended warranties are not transferable and will not add to your vehicle’s value.Can I get a full refund when canceling my car warranty? Refunds for car warranty cancellations are often prorated, meaning the amount depends on how long you’ve had the warranty and how much mileage you’ve covered. Some providers deduct processing fees, so review your contract carefully to understand the refund policy.Negotiating a Better Deal Speak with the finance and insurance managers, explain that you want to buy a new car and need to talk to them about the factory extended warranty on the vehicle. You may find that three different dealerships will give you three different prices on the same coverage.
What is not covered by the Mercedes warranty?
The Mercedes-Benz Warranty covers bumper-to-bumper and powertrain components, rust perforation, emission components, and safety belts. It protects against defects originating from the factory but does not cover normal wear and tear or maintenance costs. Mercedes-Benz Warranty Coverage: New Vehicles This new vehicle limited warranty coverage is quite comprehensive, covering powertrain, corrosion perforation, and roadside assistance. That said, not every component of your new Mercedes-Benz is covered. Some examples of non-warrantable parts include: Brake pads.Cons of Buying a Mercedes-Benz Your monthly payments may, therefore, be high. You’ll also have dealership fees and other fees associated with the purchase. Additionally, you’ll be responsible for vehicle repairs once the warranty coverage expires.With a Mercedes-Benz Extended Warranty, you’re covered for any costly repair bills that may arise if your car experiences a mechanical or electrical failure. As the owner of one of our Extended Warranty policies, you can drive with ease knowing you’re protected.