Consumer Reports: Prepaid car maintenance plans

Whether you're in the market for a new or used car, there are plenty of add-ons to consider. Should a pre-paid maintenance plan be one of them? The car experts from Consumer Reports share some important tips, to help you make the right choice.

If you've bought a car recently, there's a good chance the dealer tried to sell you a pre-paid maintenance plan, encouraging you to pay up front for regularly scheduled maintenance.

"It's different than an extended warranty, which covers things on the car when they break," said Mike Monticello of Consumer Reports. "A pre-paid maintenance plan covers the services that you're required to do to keep the car running in top shape. Things like oil changes, filter replacements, and rotating your tires."

Automotive experts at Consumer Reports say there are pros and cons to considering one.

The cost can be bundled into your auto loan, so the monthly bump in price can feel negligible. But this means you'll be paying interest. To avoid this, pay for the plan in full, separately.

"For a lot of people, it's about peace of mind. And you can't really put a price on that," Monticello said.

Also, ask whether the plan can be transferred with the car, if you sell the car before the plan expires. And, as always, read the fine print.

Some plans have restrictions, like where work can be done.

"Factory-backed plans are typically honored at any dealership that sells the same brand of car that you bought," Monticello said. "Which is helpful if you move. But if you live far away from a dealership, this can be a hassle. Or if you have a local mechanic that you'd actually rather use."

Most importantly, do the math. Compare the cost of the plan you're considering, against the cost of the actual maintenance it covers.

You can ask the dealer what each service costs to get an idea of a plan's true value.

You can also get an idea of what a typical service costs by going to www.consumerreports.org/cars/repair/ and then clicking on 'scheduled maintenance.'

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