Hello!,
Avid reader, first time poster. First of all I would like to point out that I live a pretty frugal lifestyle, and my spouse is mainly on-board with most frugal/financial decisions. However, she is still a little stubborn and not as motivated as per say, you and I are at becoming FI.
Anyway! We are purchasing her a car as her old one is a baseline student discount vehicle with endless problems (2005 Pontiac wave). We have settled on purchasing a 2011 Ford Fiesta with only 10,000 miles on it. Price: $11,998 CAD (We're Canadian). Seems like a fair deal in my opinion, as I know this vehicle will last a very long time, is very fuel efficient, and is a small car.
My dilemma is about a so called "warranty" that Ford offers when purchasing the vehicle. It costs $2,700 and it doesn't expire until you hit 124,000miles. I figure we will drive it 9300 miles/year. Therefore the warranty should be good for the next 12 years. Hooray!
The warranty basically covers anything besides the wear components of the vehicle. (ie. tires, rotors, brake pads, oil changes are not covered). Any other issues will fall under the warranty (apparently).
Lastly, which is killing me on the inside (but due to stubbornness and the sake of our happy marriage), we have to take out a small car loan. The loan will be approx. $5000 (+4.99% interest rate) and should be paid off before summer is over. If we buy the warranty this will increase to almost an $8000 loan.
Would it be facepunch worthy to buy this warranty?
Thanks :)