used cars http://www.wisebread.com/taxonomy/term/11453/all en-US 7 Websites You Must Visit When Buying a New Car http://www.wisebread.com/7-websites-you-must-visit-when-buying-a-new-car <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/7-websites-you-must-visit-when-buying-a-new-car" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/car-4897632-small.jpg" alt="car" title="car" class="imagecache imagecache-250w" width="250" height="167" /></a> </div> </div> </div> <p>Buying a new car is a pretty stressful experience. You&rsquo;re putting down a pretty large chunk of cash, and you&rsquo;re making a commitment to allocate part of your monthly budget to a new expense you didn&rsquo;t have before. (See also: <a href="http://www.wisebread.com/17-things-car-salesmen-dont-want-you-to-know" target="_blank">17 Things Car Salesmen Don&rsquo;t Want You to Know</a>)</p> <p>Which isn&rsquo;t too bad...except the part where you actually go buy the car and you feel like you&rsquo;re getting taken advantage of by <a href="http://www.youtube.com/watch?feature=player_embedded&amp;v=4bZeGM-Q1rs" target="_blank">ruthless, experienced salesmen</a> who want to take as much of your money as they can.</p> <p>Which is where the Internet comes in.</p> <p>Thanks to the world wide web, you don&rsquo;t have to go through this all on your own. There are millions of <a href="http://www.wisebread.com/how-to-save-money-buying-a-new-car-and-be-happy" target="_blank">people out there sharing their experiences</a> on the best way to deal with car salesmen and how to get the best deal possible.</p> <p>So let&rsquo;s take a look at the best sites out there to help get you on your way.</p> <h2>1. Edmunds.com</h2> <p><a href="http://www.edmunds.com/" target="_blank">Edmunds is a great place</a> if you want to read tips and advice on which car is a good match for you. Their reviews and feature stories provide lots of information on both new and used cars.</p> <h2>2. Kelley Blue Book (KBB.com)</h2> <p>Kelley Blue Book is similar to Edmunds in that they have some good reviews and information, but <a href="http://www.kbb.com/" target="_blank">KBB's real strength is pricing information</a>. Want to know how much your old car is worth as a trade in? How much should you pay for the new car you&rsquo;re looking at? Kelley Blue Book is an agreed-upon standard in the car business, so you need to be in-the-know on what the Blue Book value is for any car you&rsquo;re thinking of buying or selling.</p> <h2>3. Truecar.com</h2> <p>It&rsquo;s great to have the Blue Book value, but you want to get as many different quotes from different sources as you can to find out what you should be paying for your new car. <a href="http://www.truecar.com/" target="_blank">Truecar</a> is great because they&rsquo;ll show you a continuum of the different prices for a specific car (MSRP, Invoice, Average Paid), so you can see what the <a href="http://www.wisebread.com/the-game-of-haggling-how-to-get-a-great-deal-on-a-used-car" target="_blank">car is being actively sold for</a>.</p> <p>It&rsquo;s really eye opening to see how the <a href="http://www.wisebread.com/the-joy-of-buying-a-new-car-9-car-buying-tips" target="_blank">MSRP is really just for show</a>. You should never even come close to paying that much for a new car.</p> <h2>4. Autotrader.com</h2> <p>I've used <a href="http://www.autotrader.com/" target="_blank">Autotrader</a> as a secondary source of information. After visiting the sites listed above, this was just to make sure that my data was good and I hadn&rsquo;t missed anything. They also have a useful tool that&rsquo;ll show you any and all dealers near you, so you can start reaching out to them to get the best price on your new car.</p> <h2>5. Carmax.com</h2> <p><a href="http://www.carmax.com/">Carmax</a> doesn't really sell new cars, but I just used their site to price out a trade in. The website is another place you can get a quote for the value of your car. What you want to do, however, is go to an actual Carmax location and get a full-blown quote. They&rsquo;ll guarantee it for seven days, and you can take that to your dealer to use as leverage so they give you the full value of your trade-in. If they don&rsquo;t, simply go back to Carmax and deal with them.</p> <h2>6. NadaGuides.com</h2> <p><a href="http://www.nadaguides.com/" target="_blank">Nada Guides</a> is similar to Truecar in that you&rsquo;ll get a much better idea of what you should be paying for the specific car you&rsquo;re looking at buying. This database is what car dealers use to value trade-ins, so if you&rsquo;re armed with this information you&rsquo;ll be one step ahead of the game.</p> <h2>7. Enthusiast Forums</h2> <p>I wish I could give you a link to the specific forum for the car you&rsquo;re interested in buying, but that list would be too long. Spend a little time searching for information on the car you want, and eventually the same forum will start showing up again and again. That's the one you visit.</p> <p>That&rsquo;s what happened to me as I researched my Subaru Outback. I discovered a TON of really helpful people over on <a href="http://www.subaruoutback.org/" target="_blank">SubaruOutback.org</a> and <a href="http://www.cars101.com/" target="_blank">cars101.com</a> (run by an actual Subaru dealer). There&rsquo;s nothing like talking to people who have bought the exact same car you want to buy. They&rsquo;re eager to share their stories and experiences about living with the car &mdash; and buying it.</p> <p>The Internet is a great ally when you're out there trying to get a good deal on a new car. These sites were crucial in my <a href="http://www.thewriterscoin.com/buying-a-new-car-avoid-the-hassle/" target="_blank">recent car-buying experience</a>.</p> <p><em>What Internet resources have you used to help you through the car buying process?</em></p> <a href="http://www.wisebread.com/7-websites-you-must-visit-when-buying-a-new-car" class="sharethis-link" title="7 Websites You Must Visit When Buying a New Car" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">Written by <a href="http://www.wisebread.com/carlos-portocarrero">Carlos Portocarrero</a> and published on <a href="http://www.wisebread.com/">Wise Bread</a>. Read more <a href="http://www.wisebread.com/taxonomy/term/"> articles from Wise Bread</a>.</div></div> Cars and Transportation Shopping buy a new car car research shopping research used cars Tue, 07 May 2013 09:30:21 +0000 Carlos Portocarrero 973716 at http://www.wisebread.com Skip the Trade-In: Why You Should Sell Your Car Privately http://www.wisebread.com/skip-the-trade-in-why-you-should-sell-your-car-privately <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/skip-the-trade-in-why-you-should-sell-your-car-privately" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/used_car_dealership.jpg" alt="Used car dealership" title="Used car dealership" class="imagecache imagecache-250w" width="250" height="122" /></a> </div> </div> </div> <p>When it&rsquo;s time to get a different car or upgrade to a later model, people get excited. Blame it on the fumes from that new car smell, but it&rsquo;s at these moments when we lose a little of our money mojo and tend to gravitate toward the quickest and most convenient ways to dispense with our old wheels. Entire chain-store auto dealerships have evolved from car buyers who want to be anything but a car seller. (See also:&nbsp;<a href="http://www.wisebread.com/guide-to-buying-a-used-car-without-going-crazy">Guide to Buying a Used Car Without Going Crazy</a>)</p> <p>The markup those dealerships enjoy once they&rsquo;ve taken down your fuzzy dice and done a bit of spit-shining and maintenance averages between 25-45% depending on the dealership and model, according to industry sources like <a href="http://edmunds.com">Edmunds.com</a>. If you&rsquo;re up for some broader reading on the topic of how auto dealerships really work, check out Phillip Reed&rsquo;s classic series of articles from 2001 (and updated in 2009), <a href="http://www.edmunds.com/car-buying/confessions-of-a-car-salesman.html">Confessions of a Car Salesman</a>. Reed is Senior Consumer Advice Editor for Edmunds.com and went undercover as a car salesman to get the scoop on how dealerships maximize profits. It&rsquo;s interesting and educational reading &mdash; hovering somewhere between an expose and an indictment.</p> <p>So why do we do it? Why do consumers rush to trade-in what they&rsquo;ve worked so hard to afford? Why do normally financially savvy folks go cross-eyed at the prospect of cleaning, advertising, and selling their own used car privately? I think it&rsquo;s a combination of intimidation (about the work involved and about smart selling strategies) and fear (about meeting with buyers and negotiating the best price). But there are some very real advantages that come from selling a car privately that shouldn&rsquo;t be taken lightly or dismissed with a wave of the hand and an &ldquo;it all evens out in the end&rdquo; rationale.</p> <h3>1. You Remove the Middle Man</h3> <p>Removing the middle man from the transaction preserves an entire layer of profit. Now, I don&rsquo;t have a beef with used car dealerships, but they are in business to make money and they can only do that in two ways:</p> <ol> <li>By giving you less money on your trade-in.</li> <li>Getting you to pay them more for a new car.</li> </ol> <p>The most successful dealerships do both at the same time and even sweeten their pots a little by handling the financing themselves (I call this the trifecta of bad consumer deals).</p> <h3>2. You Can Make Up for Not Getting the Trade-In&nbsp;Tax Break</h3> <p>Granted, in most states there are <a href="http://www.wisebread.com/16-great-tax-deductions-you-may-have-overlooked">tax advantages</a> to trading in your car at the dealership (in these states, you pay sales tax only on the difference between the value of your trade in and the price of the new car, rather than the total price of the new car). But if your car is in reasonable condition, reliable, and cleans up well, the tax advantage can be more than compensated for with the higher private sale price.</p> <h3>3. More Money Now Means Less Financing Later</h3> <p>Selling privately puts cash in your hands now, and that cash can be used to reduce the amount financing needed for a new car. Sure the sales tax benefit is nice if it applies, but that sales tax is probably going to just be financed anyway, so why not sell privately, apply a larger down payment, and finance the bare minimum?</p> <h3>4. Selling Your Own Car Builds Confidence</h3> <p>Sure, it sounds a little hippy-dippy, but it&rsquo;s worth mentioning anyway. How many times in our lives do we really have an opportunity to make a deal with another person one-on-one &mdash; no broker, no banker, no candlestick maker? I think there&rsquo;s some value in good old-fashioned face-to-face deal-making. It helps teach salesmanship, the value of research, marketing, communication, and <a href="http://www.wisebread.com/the-7-laws-of-negotiation">negotiation</a>. Especially for younger folks, those lessons can be applied in countless ways to many other larger transactions in life.</p> <p>When we trade-in our cars or sell directly to auto emporiums, we&rsquo;re really outsourcing a job that&rsquo;s not that difficult to do ourselves, and the only reward we get in return is convenience. Sure, there are some situations when trading in a car makes sense, but in most cases, sellers come out ahead when we handle the sale ourselves and can reap the benefits of a higher sale price. If you&rsquo;d like to learn more about selling your car privately check out this <a href="http://www.wikihow.com/Sell-Your-Car-Privately">step-by-step guide</a>. All it takes is a little confidence, some <a href="http://www.wisebread.com/20-great-frugal-skills-and-how-to-get-them">basic marketing skills</a>, and really good wash and wax job.</p> <p><em>Have you sold a car privately or been taken for a ride on a trade-in? What advice would you give to first-time car sellers?</em></p> <a href="http://www.wisebread.com/skip-the-trade-in-why-you-should-sell-your-car-privately" class="sharethis-link" title="Skip the Trade-In: Why You Should Sell Your Car Privately" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">Written by <a href="http://www.wisebread.com/kentin-waits">Kentin Waits</a> and published on <a href="http://www.wisebread.com/">Wise Bread</a>. Read more <a href="http://www.wisebread.com/taxonomy/term/"> articles from Wise Bread</a>.</div></div> Cars and Transportation DIY sell your stuff trade in used cars Tue, 27 Nov 2012 10:36:35 +0000 Kentin Waits 955569 at http://www.wisebread.com What to Do With a Junk Car http://www.wisebread.com/what-to-do-with-a-junk-car <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/what-to-do-with-a-junk-car" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/501968180_2daaea9223_z.jpg" alt="junk car" title="junk car" class="imagecache imagecache-250w" width="250" height="141" /></a> </div> </div> </div> <p>As soon as you drive off the lot in your new car, it depreciates in value by about 15%, and continues to depreciate by about 15% every year thereafter. After about 10 years, the vehicle is almost worthless, especially if you bought it used. But almost worthless isn&rsquo;t <em>completely</em> worthless. While it may seem as though your beat-up old car is on its last leg, rest assured that it still has a little life left &mdash; perhaps even a whole new one. To help you decide how to dispose of your beater, here are eight ideas that can make you money, save you money, and give aquatic animals a new place to call home. (See also:&nbsp;<a href="http://www.wisebread.com/drive-the-old-car-or-buy-a-new-car">Drive the Old Car or Buy a New Car?</a>)</p> <h3>1. Donate It to Charity for a Tax Write-Off</h3> <p>There are a lot of charities that offer car donation programs. The charity will sell the used car for parts and put the cash earned back into the program, or it might use the vehicle for mobile services it offers, fixing up the car to save cash on an otherwise expensive purchase. No matter what the charity&rsquo;s intended purpose for the donated vehicle, you&rsquo;ll still receive a receipt to deduct the donation on your taxes. Some will even pick up the car from your home so you don&rsquo;t have to pay a towing company. Donating your vehicle to charity doesn&rsquo;t come without its complications, however; there are middlemen, bogus charities, and legal issues that you may have to contend with. But you can make sure you&rsquo;re not getting swindled with these <a href="http://today.msnbc.msn.com/id/26625209/ns/today-money/t/how-donate-car-or-boat-charity/#.T4MmnMzeYps">10 tips on how to donate car</a>.</p> <h3>2. Sell It Whole or in Parts</h3> <p>Just because you don&rsquo;t want that clunker anymore doesn&rsquo;t mean that someone else can&rsquo;t use it. Even if your car doesn&rsquo;t run, it&rsquo;s still full of valuable parts that are worth a pretty penny. Local services like Craigslist can help you unload the lot on someone close to home, or you can head to <a href="http://www.junkmycar.com/">Junk My Car</a>, where you&rsquo;ll get an instant quote on your rundown ride and a scheduled appointment of when the vehicle will be removed.</p> <h3>3. Trade It In for a Newer Model</h3> <p>If your car has any kind of resale value at all, you may be able to trade it in at the dealer when buying a new car. You probably won&rsquo;t get top dollar, but what you do receive can be applied to the purchase price of the new vehicle, ultimately saving you money. Don&rsquo;t forget to factor in the convenience, too. By trading it in, you don&rsquo;t have to worry about finding the right buyer or the potential expense of towing.</p> <h3>4. Turn It Into a Work of Art</h3> <p>When I was in high school, our football team was playing a rival team called the Mustangs at homecoming, and it was my job as a class officer to help build a float for the parade. One of our teachers had the brilliant idea to have a Mustang car cut in half and attach a papier-mâché horse&rsquo;s head to the vehicle with the theme of &ldquo;Demolish the Mustangs.&rdquo; While the theme was uninspired, the float was one of the most creative the school had ever seen. Now, I know that we don&rsquo;t have homecoming parades everyday, but this example proves that there are lots of creative ways to recycle a junk car. Have any other ideas?</p> <h3>5. Recycle Useable Pieces</h3> <p>Before you send the car to the scrap yard, scavenge it for pieces you can use elsewhere. Perhaps the windshield or side glass can serve a purpose down the road, or maybe your kids would like to swing from a tree on the tires. Sit with the car for a few minutes and take inventory of what&rsquo;s available &mdash; then think of ways to squeeze every last bit of use out of it.</p> <h3>6. Provide Fish a New Habitat</h3> <p>OK, this might be pushing it, but you never know&hellip;if you have a pond or lake in your back yard or nearby, considering dumping the car there to provide a habitat for underwater creatures. This idea comes from the concept of building an artificial reef to help promote marine life. Make certain, however, that all potentially hazardous debris is removed from the vehicle and that you drain all liquids. You&rsquo;ll completely defeat the purpose of the exercise if you kill the fish with pollution rather than provide them with a stimulating environment in which to exist.</p> <h3>7. Barter With a Friend</h3> <p>Maybe one of your friends has something you want that he or she is willing to part with in exchange for your car? Lots of people work on old vehicles as a <a href="http://www.wisebread.com/make-your-hobby-pay-its-way">hobby</a>, so this isn&rsquo;t totally out of the question. Remember, one person&rsquo;s trash is another person&rsquo;s treasure.</p> <h3>8. Give It to a Local Mechanics&rsquo; School</h3> <p>I&rsquo;m not the kind of guy who wants to spend my days under the hood of a car, but instead of Algebra II &mdash; which I have absolutely no use for in my adult life &mdash; I would have preferred that life skills were mandatory in high school; to this day, I barely know how to change a tire. Meanwhile, the kids who took shop class are saving a lot of money because they know how to do things that the rest of us have to pay for. To keep this tradition alive, give your junk car to a trade program in town. Almost every high school has one. You may still qualify for a <a href="http://www.wisebread.com/16-great-tax-deductions-you-may-have-overlooked">tax write-off</a>, and you&rsquo;ll sleep better knowing that you helped people in your community gain valuable skills.</p> <p><em>Have even more ideas on how to get rid of a junk car? Let me know in the comments below.</em></p> <a href="http://www.wisebread.com/what-to-do-with-a-junk-car" class="sharethis-link" title="What to Do With a Junk Car" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">Written by <a href="http://www.wisebread.com/mikey-rox">Mikey Rox</a> and published on <a href="http://www.wisebread.com/">Wise Bread</a>. Read more <a href="http://www.wisebread.com/taxonomy/term/"> articles from Wise Bread</a>.</div></div> Cars and Transportation getting rid of vehicle junk used cars Tue, 10 Apr 2012 09:36:19 +0000 Mikey Rox 917198 at http://www.wisebread.com The Safest Cars for Teen Drivers http://www.wisebread.com/the-safest-cars-for-teen-drivers <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/the-safest-cars-for-teen-drivers" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/first_car.jpg" alt="Teen driver in car" title="Teen driver in car" class="imagecache imagecache-250w" width="250" height="146" /></a> </div> </div> </div> <p>When I started driving six months before turning 16 years old &mdash; with a learner&rsquo;s permit &mdash; I was terrified of the roadways.</p> <p>Remember that scene in <em>Clueless</em> when Dionne accidentally exits onto the freeway and she, Cher, and Murray freak out? That was me. In fact, until I was about 19 years old, I had to turn off the radio when merging into moving traffic, and for the first year I avoided highways all together.</p> <p>It didn&rsquo;t help that I owned a beater of a car &mdash; and that&rsquo;s an understatement. This vehicle was so terrible that one of my best friend&rsquo;s fathers refused to let her in it. And in hindsight, I don&rsquo;t blame him. It looked like it might break down or blow up at any minute. Eventually it did &mdash; break down, that is. Luckily it was in my own neighborhood, so I did what any self-respecting teen boy would do in that situation &mdash; I called my dad to pick me up and left the car where it died for someone else to scavenge.</p> <p>So your kid doesn&rsquo;t suffer the same fate, conduct research into a vehicle&rsquo;s safety before you buy. I know that not everyone can afford a new car or even a great used car when their kid reaches driving age, but safety is never a poor investment.</p> <p>To help you make the most informed decision, I&rsquo;ve asked a few experts for their insight on how to choose the safest car for your new driver. Here&rsquo;s what they had to say. (See also: <a href="http://www.wisebread.com/how-to-get-cheap-auto-insurance-for-young-drivers">How to&nbsp;Get Cheap&nbsp;Auto Insurance for Young Drivers</a>)</p> <p><strong>Q: Overall, what's the safest type of car for teens?</strong></p> <p>A: &ldquo;Teens are safest in a mid-sized, four-door sedan with four cylinders. This type of vehicle does not have too much power, but still allows the inexperienced driver to maneuver safely through traffic,&rdquo; says LeeAnn Shattuck, co-owner of <a href="http://womensautomotivesolutions.com/home/womens_automotive-home.php">Women&rsquo;s Automotive Solutions</a>, a consulting firm that helps women (and men) buy cars. &ldquo;It's big enough to protect them sufficiently in an accident, but not so big that it is difficult to control. They also can't stuff too many of their friends into a mid-sized sedan, which can be a significant distraction for teens. My insurance agent partners all say that this type of vehicle is also the cheapest to insure for a teen.&rdquo;</p> <p><strong>Q: What about SUVs? They seem safe, especially since there&rsquo;s a higher center of gravity. Are they good for teen drivers?</strong></p> <p>A: &ldquo;Many parents think their teen is safest in an SUV because it will protect them in an accident,&rdquo; Shattuck says. &ldquo;But statistics from the Insurance Institute for Highway Safety (IIHS) show that teens are more likely to get <em>into </em>an accident in an SUV (vs. a sedan) because those larger vehicles (with a higher center of gravity) are much more difficult to control if they have to take evasive action. Because the SUVs also tend to cause more damage in an accident, insurance rates are higher.&rdquo;</p> <p><strong>Q: Besides safety in accidents, what are some other concerns parents should think about when buying a car for the teen?</strong></p> <p>A: &quot;I advise parents to avoid Hondas for their teens, especially for teen girls, since Honda Civics and Accords are the most stolen cars in America. You don't want your 16-year-old daughter getting car jacked on her way home from soccer practice or work,&rdquo; says Shattuck. &ldquo;I tend to steer parents more towards the Toyota Camry or even Corolla, the Nissans, and the Hyundais. Even the Ford Focus or Fusion (or an older Taurus) are safe and reasonably reliable. If they really want an SUV (to be higher up for better visibility), I highly recommend the Ford Escape. It's a decently reliable little SUV, easy to drive, used ones are in the $6,000 to $10,000 range, and they have relatively low maintenance costs.</p> <p><strong>Q: What are the benefits of a used car over a new car?</strong></p> <p>A: &ldquo;Buying used for a young driver makes more sense than buying new since overall vehicle costs on used cars are typically lower,&rdquo; says Max Katsarelas, marketing strategist for <a href="http://www.mojomotors.com/">Mojo Motors</a>. &ldquo;Plus, with the rapid depreciation of a new car once it drives off the lot, buying used can save some major coin, especially when considering the accident rate of young drivers. Auto repair costs for young drivers total about $19 billion, so buying a new car doesn't make financial sense when taking into consideration the resale value after an accident. Since a vehicle's crash history can be seen with a Carfax report and any sign of an accident, even &lsquo;fender benders&rsquo; drop a vehicle's resale value considerably. Ultimately, the best bet for parents looking at cars for young drivers should <a href="http://www.wisebread.com/6-reasons-why-used-is-better">buy used</a>. For example, a new 2012 Ford Focus starts at around $18,000. A gently used 2008 Ford Focus with under 60,000 miles can be had for under $10,000. Both boast the highest safety rating, &lsquo;Good&rsquo; from IIHS, but a used Focus can cost up to $10,000 less.</p> <p><strong>Q. If parents want to buy their new driver a new car for under $15,000, what are some of the best options?</strong></p> <p>A: Money Crashers recently compiled a list of the <a href="http://www.moneycrashers.com/best-affordable-cars-college-students/">&ldquo;10 Best Affordable Cars for College Students.&rdquo;</a> Of course, the choices are great for teen drivers in high school, too, since their parents are likely covering at least part of the vehicle&rsquo;s cost. As it turns out, most of the cars on the list, as mentioned by the experts, are four-door sedans with modest sticker prices and a history of safety. While these selections and prices are based on new cars, feel free to use this guide to help identify economical used cars with good safety ratings.</p> <a href="http://www.wisebread.com/the-safest-cars-for-teen-drivers" class="sharethis-link" title="The Safest Cars for Teen Drivers" rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">Written by <a href="http://www.wisebread.com/mikey-rox">Mikey Rox</a> and published on <a href="http://www.wisebread.com/">Wise Bread</a>. Read more <a href="http://www.wisebread.com/taxonomy/term/"> articles from Wise Bread</a>.</div></div> Cars and Transportation Consumer Affairs Buying a new car driving safety teens used cars Thu, 22 Dec 2011 11:24:13 +0000 Mikey Rox 835751 at http://www.wisebread.com Are Extended Warranties Ever a Good Deal? http://www.wisebread.com/are-extended-warranties-ever-a-good-deal <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/are-extended-warranties-ever-a-good-deal" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://www.wisebread.com/files/fruganomics/imagecache/250w/blog-images/iStock_000009675200XSmall.jpg" alt="" title="" class="imagecache imagecache-250w" width="250" height="188" /></a> </div> </div> </div> <p>Extended warranties are everywhere. Every time you buy a car, a house, a computer, a cell phone or pretty much any appliance, you'll be offered a chance to purchase an extended warranty on it. A few years ago, my husband came home with a new toaster &mdash; and a warranty contract for it.</p> <p>Are these warranty contracts ever a good deal? They shouldn't be. To make a profit, the private companies that offer these things need to take in more money than they pay out in warranty claims. And they do make money. The profit margin on extended warranties is reputed to be between 40 percent and 80 percent. Anyone buying an extended warranty is betting against the house.</p> <p>I've never bought a lottery ticket, but I do often buy extended warranties. Why? Because I am brutal on my possessions. I drop them, I spill things on them, I crash them into things. I also have two small kids and a teenage boy in my household, who are no gentler than I am. I bought an <a href="http://www.apple.com/support/products/">Apple Care</a> contract on my last laptop, and used it for numerous phone support calls, two mail-in repairs, and two complete replacements of the machine. Apple Care is notorious for being unquestioning in their acceptance of warranty repairs: most contracts won't cover something that has obviously gone dancing with a two-year-old or been run over by a car.</p> <p>When I posted about <a href="http://www.wisebread.com/the-game-of-haggling-how-to-get-a-great-deal-on-a-used-car">buying an extended warranty</a> for my new-to-me car, a few people suggested I'd broken one of the first rules of car purchasing: never buy the extended warranty. I wanted the warranty because I'm just getting out of debt, and don't have a lot of savings put aside. The thought of facing a large repair bill while paying off a car loan was more than I could stomach. Will I get my money's worth out of it? I hope not, because that would mean my car needs no major repairs in the next five years. If I don't, I won't buy one on my next car. By then I expect to have enough cash savings to cover any repairs that might come up.</p> <p>So should you ever buy an extended warranty? The experts say no. Consumer Affairs outlines <a href="http://www.consumeraffairs.com/news04/2005/extended_warranty.html#ixzz0WCwsviRI">five good reasons not to</a>. Here's one good reason to consider bucking that wisdom: you might know something they don't. I would consider buying an extended warranty if:</p> <ul> <li>I was insuring something I needed to have ready access to. If you rely on your car to get to work, for example, and don't have sufficient savings to pay for a major repair, a warranty might be an insurance policy against lost income while your car was broken down, as well as covering the expensive repair.<br /> &nbsp;</li> <li>I knew I would be extremely hard on my purchase. For example, I knew when I bought my laptop that I had a toddler and was about to have another baby. I could reasonably expect the laptop to fall victim to an accident during the three years the warranty covered.<br /> &nbsp;</li> <li>I was buying something for someone else. My mother gave me a suite of children's bedroom furniture when I had my first child, and it came with a warranty against breakage or stains. It may not have been a good deal, but it was part of the gift: she gave me furniture and the freedom to not worry about the kids breaking a drawer or spilling milk on the rocking chair.</li> </ul> <p>Probably, even if you think you're gaming the system, you'll lose. After all, these companies do make a profit, and no one buys a warranty expecting to lose money on it. But if you really do have a special case, like my &quot;laptop vs. toddler&quot; situation, a warranty might be a good bet for you. It's still a gamble though, and putting that money in the bank will never steer you wrong.</p> <p>&nbsp;</p> <a href="http://www.wisebread.com/are-extended-warranties-ever-a-good-deal" class="sharethis-link" title="Are Extended Warranties Ever a Good Deal? " rel="nofollow">ShareThis</a><br /><div id="custom_wisebread_footer"><div id="rss_tagline">Written by <a href="http://www.wisebread.com/sierra-black">Sierra Black</a> and published on <a href="http://www.wisebread.com/">Wise Bread</a>. Read more <a href="http://www.wisebread.com/taxonomy/term/"> articles from Wise Bread</a>.</div></div> Shopping extended warranties used cars Mon, 09 Nov 2009 16:00:02 +0000 Sierra Black 3807 at http://www.wisebread.com