Owning a car isn’t cheap let’s be honest here.
First, there’s repaying the finance company for the next few years. Then there’s the cost of servicing and insurance. Finally, there’s the nightmare scenario of what happens if the gearbox packs up?
Fortunately, when you buy a new car the only problem you face is repaying the loan. Your purchase comes standard with a motor warranty and service plan. Your problems kick in once the warranty expires. Now servicing and major repairs become your problem which is why most people sell their cars before the warranty expires.
Are we saying you shouldn’t buy a car with an expired warranty?
Not at all. For many of us, the option is to buy either a brand-new entry-level car with no bells or whistles or a more upmarket second-hand vehicle. We wouldn’t blame you for going with option two.
So, what’s the first thing you should get if you’ve chosen a second-hand vehicle?
Unless you’ve got a chunk of spare change lying around, definitely invest in a motor warranty plan. Replacing a gearbox could bankrupt you. I’m looking at replacing a clutch on my car and I’ve been told that the spares alone will cost R35, 000.
The bottom line is – if you don’t have the money to take care of unexpected expenses then a motor warranty is a must.
The second thing you should do if buying a second-hand vehicle?
Find out how much a major service will cost. Let’s assume it costs R5 000. Where do you find the money if you’re still paying off the car, paying for insurance, and never mind the cost of fuel?
What you need is some sort of insurance policy that will pay for services. The good news is that you can but it’s not a motor warranty plan.
What is the difference between motor plans?
We’ve already talked about motor warranty plans. It covers you for the often-massive cost of replacing engine parts such as turbochargers, crankcases, and fuel injectors.
A word of warning about warranties:
Warranties do not cover normal wear and tear. So worn brake discs, for instance, would not be covered.
There’s also a difference between a manufacturer’s warranty and an aftermarket one. A manufacturer’s warranty will replace any and all of the parts on your car which fail. An after-market warranty is not as comprehensive and pays an amount depending on the age and mileage of your vehicle.
What a motor warranty plan won’t do is pay for the servicing of your vehicle. That’s why you need a service plan. Service plans take care of the costs involved in the servicing of your car and include things like oil and filters.
But then you get what’s known as a maintenance plan. This is a type of service plan, only more comprehensive since it includes wear and tear. If your brake pads or windscreen wipers are worn out, these would be replaced in terms of your maintenance plan. And before you ask, tyres are not covered.
There you have it in a nutshell. The first priority should be a motor warranty plan. Hopefully, the vehicle you purchase still has a manufacturer’s warranty applicable. If not, then an extended or aftermarket motor warranty is a must. Compare a few options to see what’s on offer.
A service or maintenance plan can also be bought once the manufacturer’s service plan expires. If your budget is tight then either one of these makes sense.
We did a video a few weeks back, which also covers the above content