Developing a financial plan for car repairs
Posted on: 24 April 2018
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If you use your car on a daily basis to get to and from work, to pick your children from school, or to travel over long distances, you know how inconveniencing it can be to have your vehicle break down. In addition, costly vehicle repair can exert a financial burden and interfere with your current budget.
Car repairs can be quite unpredictable to anticipate. A seemingly minor issue can actually point to a larger problem such as engine or transmission issues that cost a lot to fix. To make sure that you're always prepared to settle a high car repair bill, there are several financial steps that you can take.
Find a good insurance plan
There are many auto insurance policies out there that provide coverage for car repairs. In exchange for a monthly premium, a large portion of your car repairs can be covered by the insurance company. In addition, selecting the right insurance policy can ease the financial burden exerted by high monthly premiums.
You can explore policies that combine accident coverage with car repairs. These often cost less because all the services are compacted into one policy. Make sure your insurer covers common car repairs that you're likely to experience, especially the costly ones such as engine or transmission issues.
Take advantage of your vehicle warranty
If you recently bought your vehicle, it most likely has a warranty against any operational issues. New vehicles purchased from a dealership come with several years of warranty or coverage for a certain number of kilometres.
Make sure you carefully go through your warranty and the types of repairs that are covered before you purchase a vehicle.
Keep an emergency savings account
Another option you could consider is keeping an emergency savings account specifically for car repairs. This can be particularly useful if you heavily rely on your vehicle for daily activities. It also comes in handy if your vehicle has a history of incurring costly repairs.
Find a good mechanic
You can also ease the financial burden of costly car repairs by maintaining a good relationship with your mechanic. Start by finding a reliable mechanic who offers quality services. Developing a good working relationship can enable you to save on costs and to even get more time to pay for repairs.
It is not uncommon for a mechanic to repair a trusted customer's vehicle and to give them time to slowly offset the cost.