Are Those Wheel And Tire Protection Plans Worth It?

Illustration for article titled Are Those Wheel And Tire Protection Plans Worth It?
Photo: Kristen Lee (Jalopnik)

As Jalopnik’s resident car-buying expert and a professional car shopper, I get emails. Lots of emails. I’ve picked a few of your questions and will try to help out. This week we are discussing wheel and tire protection plans and the best minivan to buy for around $17,000.

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First up, are those wheel and tire plans worth the money?

The last three cars I bought every dealer pushed hard on the wheel/tire coverage. Of course, they say ‘It’s only an extra $40 per month...and if you crack a rim those can be $2,000 or more.” But when you calculate $40 over a 60-month term that works out to around $2400. So it seems best case scenario by the time you replace one rim and a tire you break even. Do people really get a value out of these plans?

There was a time when you could get these wheel/tire protection agreements for a good price. When I bought my Mini Cooper in 2004 I think I added a plan for around $250. I hit a pothole, blew out one of the run-flat tires and cracked a rim, so the plan paid for itself and then some. These plans have gotten a lot more expensive over the years and, like most insurance plans, the numbers favor the provider.

You were smart to look at the total cost rather than just focus on the monthly payments. For most folks, these wheel and tire protection plans are probably not worth it, but buyers living in cities where road hazards are common or folks getting cars with super low profile tires that are more susceptible to damage may benefit from having the extra coverage. You can often shop these plans around and find more competitive rates outside the dealership.

Next, what is the best minivan for a modest budget?

I’ve never owned one, but I’m convinced that a minivan is “the right tool for the job”, at least for this stage of my life. After a couple years of loading my rear-facing youngest into sedans, I’m ready to join the Sliding Door Society. Chrysler’s offerings interest me the most: lots of experience renting them, the bang for the buck is outstanding, and the stow-n-go utility is attractive since I no longer own a truck. I’m mostly soliciting financial advice: would buying used or “nearly new” provide the best value? What’s the sweet spot? I can turn a wrench, never bought a vehicle still under warranty, and high mileage doesn’t scare me. Don’t want to eat a lot of depreciation, but want modern/safe enough for my family. Discussing budget would probably help: due to other priorities and trying to reduce debt, I’m willing to spend up to 5% of my monthly net income: $276. The upper limit of a loan term I’d be comfortable accepting is 60 months. I’d prefer less. Honestly, I’d prefer to pay cash and avoid interest fees, but that money seems to perform better in an index fund. 2.74% is the best rate my credit union could offer, and accounting for tax and putting a year’s worth of payments down up front, that seems to work out to a budget of around $17k. That buys a lot of any vehicle, minivan especially. So I have options: a higher mileage Pacifica, a mint Grand Caravan, a retired Enterprise rental even looks enticing. The Odyssey and Sienna tend to command higher prices and maybe they’re worth it, but I’m not sure. I ruled the Sedona out because of the full center console; I’d prefer the open space between the two front seats. I need a van, and not one that’s pretending to be a crossover. And I’d like to make the most of my money. What are your thoughts?

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When it comes to minivans there really is no wrong answer and the key limiting factor here is your budget and what kind of features you want. Are leather seats and a sunroof necessary, or are you ok with a more “basic” van? I would say that at a minimum power sliding doors are a critical option, but most mid-trim vans will have those as standard equipment.

At $17,000 a newer Pacifica is likely to have some serious mileage on it and because Hondas and Toyotas tend to hold their value well, you would be looking at an older/higher mileage example of the Japanese vans. You can find good examples of Siennas and Odysseys it’s just going to take a bit more work. I would say at that price point the Grand Caravan is the way to go, you can get one with reasonable miles and hopefully some warranty balance. You are also more likely to get an example that is a bit newer with more updated features.

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Got a car buying conundrum that you need some assistance with? Email me at tom.mcparland@jalopnik.com!

Tom is a contributing writer for Jalopnik and runs AutomatchConsulting.com. He saves people money and takes the hassle out of buying or leasing a car. (Facebook.com/AutomatchConsulting)

DISCUSSION

atcgnome
The Stig's Chamorro cousin (Chamorrovirus)

A good friend of mine, who is Not a Car Person, buys the wheel and tire warranty for every vehicle he buys or leases. I thought it was ridiculous the first time he told me about it, only to discover that he has an unbelievable ability to destroy tires, and sometimes wheels. I believe his 530e went through 6 (?) tires destroyed by road debris in the 3 years he leased it.  Other vehicles had similar luck.

I do not know how this happens to some people, but he’s one of them, and it’s for them that this is totally worth it.