Ugh. So I just realized something incredibly stupid that only spending hours writing a post could have made me realize. I *think* I missed taking my car to the dealer to get its clicking noise fixed under the car warranty for free! Thus, I want to help you save money by knowing your car warranty so you won't make my mistake.
I mentioned the clicking noise in my post on paying for repairs by cash or credit. It had had been progressively getting worse for about six months. If true, that means my clicking noise began in April 2019.
My car was originally purchased on July 6, 2015. I bought it from a private party on December 28, 2016. I wanted a larger car in preparation for the birth of our baby in 2017.
For some reason, I had assumed my car only had a 3-year/40,000, transferrable bumper-to-bumper warranty. So I just assumed that I had missed the window to get the problem fixed by 15 months.
But as I was doing research online, oddly enough on my own tax rules for deducting an SUV for a business post, I discovered my SUV has a 4-year/ 50,000 mile warranty!
If I simply understood my car warranty and what it covered, I could have taken my car into the shop by July 6, 2019. I would have gotten the clicking sound taken care of for free. Plus fixed anything else the computer found wrong.
Damn it!
Know Your Car Warranty Basics, Dummy
A car is an ongoing expense that acts as a drag to your path to financial freedom. It's imperative to not only know your car warranty terms, but also be really in tune with your car.
Now that I've calmed down, I want to share some reasons why I messed up. You might mess up too if you're not careful. These reasons are like car therapy for the soul.
1) Suffer from car reliability trauma.
I pride myself on getting the best car deal possible through aggressive private party negotiations. But I also resign myself to having bad luck when it comes to car maintenance.
Given I've bought and sold over 12 used cars and have only owned one new car, I've had to do more car repairs on my own than a new-car owner.
The car that gave me the most trauma was buying a 1989 BMW 6.35CSI. It was my dream car as a middle school kid while living in Kuala Lumpur, Malaysia. I found one I thought was in good condition. It was on Craigslist for $3,000 and I bought it for $2,500 cash that day.
Shortly after purchase, the car started leaking a tremendous amount of transmission fluid. The headlights and brake lights stopped working multiple times due to a faulty circuit. Then the engine began to shut off intermittently. Thank goodness for roadside assistance towing me to safety.
The last straw was when the brakes completely stiffened up and stopped working one day. Luckily I was only driving 5 mph when it happened. That is when I bit the bullet and sold it to another enthusiast for $1,800.
I've always had this back luck car memory stuck in my head. So whenever there's a car issue, I just automatically go through this routine of calling an independent auto-mechanic to fix it instead of going to the dealer. A car warranty never enters the equations.
2) Wary of the auto dealer service department.
We all know that going to the auto dealer service department is the most expensive option. Given I had owned so many used cars in the past, I was very aware of how much cheaper it was going the independent auto service dealer route.
That said, I did go online and e-mail my auto dealer service department an inquiry. I figured why not spend a minute making an inquiry, getting a free checkup, and a price quote.
This is what I do when I refinance my mortgage. At least I'd have an option. With the price quote, I could then feel great going to an independent auto service shop and pay less.
But the dealer never got back to me so I lost a week of time waiting until I decided to find an alternative solution.
I also hold contempt for auto dealers because of an incident back in 2003. I had sold the one and only new car I owned back to the dealer for a big loss because it couldn't fit into the garage of a condo I wanted to buy. Instead of being courteous, the saleswoman I dealt with high-fived her manager once we made the deal. Ouch.
3) Afraid of getting hit with a surprise bill.
I was afraid that if I brought my car in, they would surprise me with some unexpected repair that would cost a fortune. The reviews online weren't great either.
In fact, a reader wrote in my cash or credit post, “Must be a coincidence but I just brought one of my cars for brake issue and was hit with a huge estimate this weekend ($7.4k) because the brake line had rusted. It was a shock at the price tag and essentially the cost of what I bought the car 2nd hand about 5 yrs ago.“
$7,400 is an outrageous surprise! This is the kind of stuff I fear at the auto dealer service shop. Unlike a small, independent shop where I can talk to the owners/workers/manager to try and get a better deal and develop a better relationship to minimize getting ripped off, it's hard to do the same thing at a big shop.
Granted, I'm still afraid of getting a surprise bill at an independent service shop. But at least it would be cheaper to fix, all things being equal.
4) Able to get in right away and fix my car.
Once I decided the clicking sound was bothersome enough to get it checked out, I wanted it fixed right away. All I started thinking about was my family's safety. Family safety is why I bought my bigger car in the first place. What if it was a ticking time bomb? Who knows.
For the dealer service shop, it looked like it would take at least a week before I could schedule an appointment. With the independent shop, it was only a five-minute drive from a pre-school tour we were to attend that morning. When I called, they said to come at any time.
When I arrived, I was able to pull right in and had waited only five minutes when the co-owner and lead auto-mechanic diagnosed my problem. After prodding my engine for six minutes, he said with incredible confidence, “I'm sure it's your fan that needs replacing. See my hands? They shouldn't be all black. There's a leak and your engine will eventually overheat if the fan is not replaced.“
There was no way I'd have gotten such immediate service and a diagnosis if I had gone to the dealer. He also said the computer had found some faulty oxygen sensors, but if my dashboard computer wasn't saying anything, to not worry about it.
I loved the convenience and confidence of this independent service shop. They specialized in my vehicle and the co-owner worked at the dealer service shop for 14 years prior. They gave me the peace of mind I wanted.
5) The car problem wasn't that bad.
The reason why waited six months to figure out what was going on with the clicking sound was because I couldn't hear the sound for the first four months. It was extremely faint and sounded like part of the natural engine whirl.
I only felt there might be a problem during the fifth month when I drove into a large underground garage with my window down. The garage was like an echo chamber that made the sound more noticeable.
It was only when I parked the car, left it on, and stood in front of the engine that I could clearly hear the sound. When I returned to the cabin, the sound became inaudible.
Even if I had taken the car to the auto dealer service department as soon as I felt the problem warranted checking out (5th month), I still would have missed out on the 4-year/50,000-mile warranty by two months. Frankly, I now think I'm just guessing that the clicking sound had been occurring for six months.
6) Wanted to see if I could fix the car myself.
Here's something that might surprise you. You're supposed to walk around and check your tires every week and check your engine oil and coolant every month. But how many of us really do? I don't because I just rely on the dashboard computer to tell me what's wrong.
After really noticing the clicking noise in early September (5th month), I did a ton of research online. One suggestion to fix the noise was to simply add engine oil. After I figured out how to navigate the menu (there is no dipstick in my car), the engine oil gauge was below minimum.
I bought a quart of synthetic oil and filled the engine right up to the appropriate amount. I patiently waited for two weeks to see if the sound would go away. It did not.
Then I realized my coolant container was empty. I filled that sucker right up too, hoping maybe that would make a difference. Nope. Trying to do the quick DIY fix for $30 was logical, but it cost me time and money.
7) Don't know my own car well enough.
Although I read through my car manual when I got it in December 2016, I really didn't know much beyond driving the car, playing my music over Bluetooth, and turning on and off the lights.
For example, it was only after the third year that I discovered I could press a button under the left side of the steering wheel to close my trunk. Prior to that, I had been reminding my high school tennis players I was coaching to press the button on the trunk to close it after I dropped them off.
When I brought the car in for a free inspection, the auto-mechanic asked me when was the last time I had changed my oil. I told him it must have been back in December 2016, when I first bought the car.
Waiting almost three years to change your oil, despite only driving 12,000 miles, conceptually shouldn't feel right. But I was so busy/aloof that it never occurred to me to do a service. Again, I was just depending on the dashboard computer to tell me what to do.
Whoops!
He then asked whether the service light ever went on. Initially, I said no, but then realized “Service Required” in white letters did pop up when I first started the car, then disappeared in three seconds.
I thought that was just part of the starting lights, just like how the check engine light and all the other warning lights come on when you turn the ignition halfway on some vehicles.
He said, “That's it! That's the service notification light.”
I was fully expecting to see a red or yellow service notification light that would stay on until I took it to the shop like all my other used cards. Nope. I guess Range Rovers have a more civilized way of letting the driver know. Below is a video of what I see starting up Beast Master.
Know Your Car And Your Car Warranty Inside And Out
Not only should you read your car manual thoroughly, but you also need to know when your car was originally purchased so you can calculate when your warranty expires.
Once you've calculated when your car warranty will expire, put calendar reminders every month for six months in a row before the expiration date. Then set a couple calendar reminders the week before expiration date for good measure.
Related: Is Owning Two Cars Worth It?
Maximize Your Car Warranty
Your goal is to fully inspect your car inside and out and take it to the dealership to fix everything wrong the month before your warranty expires, even if it's the smallest thing. That way, you should also buy the longest amount of time possible for when the next inevitable car issue will occur.
Also, be aware that many warranties will be voided if you do not perform your recommended scheduled maintenance. Keep a log of your maintenance records as proof.
Car manufacturers count on consumers like me to miss warranty expiration dates or simply not bother taking advantage of a car warranty, as part of their business model. It's the same way with companies selling gift cards and hoping a percentage of us forget to use them before they expire. Stay on the ball.
Owning a cheaper car provides peace of mind. But the downside is it will be out of warranty when something inevitably goes wrong.
Consider An Extended Car Warranty
If you have an expensive car that you want to keep for a long time, it may be financially and mentally beneficial to get an extended warranty.
Given I only drive 4,000 miles a year and don't plan to keep my car past 2026 (10 years), I'm going to skip the $3,000 – $5,000 extended warranty packages. Instead, I'm just going to be more vigilant in maintaining the car and fixing small things before they turn into big problems.
It gets my goat that I didn't bring Beast Master into the shop right before the warranty expired to get everything inspected and fixed. But maybe I never had the opportunity since I wasn't really aware of the problem until after the warranty expired. Maybe I can just chalk up this incident to bad luck.
From now on, I'm going to be much more in tune with my vehicle, even if my computer says there's nothing wrong. I hope you do the same.
I did a review in 2024 on whether it was the right move not to get an extended warranty, and I'm pleased to say that it was. Since buying my car in December 2016, I have spent $3,500 on maintenance expenses compared to $4,500 for an extended warranty with zero deductible. And the extended warranty would have expired about $2,000 in repairs ago.
Hence, after owning two Land Rovers for over 20 years, I think getting an extended warranty won't put you ahead.
Invest In Real Estate Instead Of Nice Cars
As you might realize by now, cars are a money pit. Not only do you have to deal with car maintenance, but you have to pay parking and traffic tickets. If you're unlucky, you might even get into an accident.
Everyone should consider owning the cheapest, most reliable car they can and invest the rest of their money in real estate. For financial freedom seekers and car nuts, check out my House-to-Car Ratio to help you be more fiscally responsible.
To invest in private real estate, take a look at Fundrise, my favorite private real estate investing platform. Fundrise was founded in 2012 and manages over $3.3 billion with over 500,000 investors. The firm focuses on residential properties in the Sunbelt, where valuations are lower and cap rates are higher. For most investors, investing in a diversified private real estate fund makes the most sense.
Another great private real estate investing platform is Crowdstreet. Crowdstreet offers accredited investors individual deals run by sponsors that have been pre-vetted for strong track records. Many of their deals are in 18-hour cities where there is potentially greater upside. Crowdstreet is a solution where you can build your own select real estate portfolio.
Personally, I've invested $954,000 in private real estate since 2016 to diversify my exposure and earn more passive income. Both Fundrise and CrowdStreet are affiliate partners of Financial Samurai, and Financial Samurai is currently invested in Fundrise.
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Thank you for taking the time to say that you should calculate when your warranty expires and set up reminders to remember before this date arrives. My dad told me that his Mercedes needs some repair and he is looking for a mechanic in the area. He recently moved so this is a new process to him, and I think he would benefit from figuring out what is wrong with his car before he takes it to an expert.
Range Rover maintenance can be a nightmare especially off warranty. Any euro lux SUV can be a nightmare for that case.
If you are looking to buy an expensive Euro luxury SUV look into Geico extended car warranty which can be bought when only the car is new. It covers 7 years, which technically is 3-4 years of extended warranty and cost ~$30 a year and $150 deductible.
I agree that buying used can yield a great savings, but you can find a brand new car with ~15% off msrp.
I bought 2018 Q7 Prestige with ~14% discount off msrp which final price was close to 1 year CPO.
PS. Avid reader. Thank you. Good luck.
Great article.
I do most of my own car work after a near deadly negligent action done by the small shop mechanic when he reassembled my fuel line. I did not take legal action against that mechanic but I probably should have as my wife and I could have been killed due to his negligence.
To keep track of needed auto maintenance, I use a free service at https://www.carfax.com/Service/. This provides me with regular service reminders based on mileage estimates. Reminders such as oil changes, tire rotation, and license plate renewals help me keep track of it all. It’s also a great way to log my DYI work for permanent records.
Thank you Financial Samurai for all your wonderful articles helping people in many ways, because it’s not just about money and you understand that.
that sucks about the near miss on the warranty, but sounds like it wasn’t too costly to repair. I also loved the 80s 6 series when I was younger (still do actually)-that’s a great pic of one that you posted? Was that your actual car? Beautiful.
Your story about that car mirrors what a co-worker of mine (young guy about 23) is currently going through with a 2007 BMW 335i coupe that he bought for 3k. He told me about it after he bought it since he knows i’m a BMW guy, and I kept praying in the back of my head that he’d bought a warranty or atleast had a pre-purchase inspection.
Sure enough, last week he came up to me looking white as a ghost. He’d taken his car to a mechanic to take a look at a leak and had gotten an 8k quote to fix everything! I encouraged him to get a second (and third opinion). Not sure what happened.
Yes, with BBS rims. It was so nice. But it was a lemon.
It was fun to own a lot of cool cars as a young lad. Now, I just want one car that works and looks good for 10+ years.
Sometimes you have to call 3-5 dealerships about a specific repair you need for pricing. I had to get a special fluid flush on my Chevy Volt, which is specific for an electric car. One dealer wanted $600 and the other $300. Different pricing on a new tires and other things. One dealer that looked at it said I needed to replace my cabin air filter. It actually doesn’t even come with one. I just bought one for $10 and put it in myself. So like the article said know your car and also call around to dealerships too that know your car well.
I also made the mistake of not having another vehicle I bought used from a private seller check out by a mechanic and trusted them. Big loss on the vehicle as a result. Another good lesson when buying is spend the extra money and have a mechanic look at it. If they say no, then run.
Whenever I plan to sell a car, I LOVE it when the prospective buyer wants to pay to have it checked out. It’s like getting a free inspection. If the buyer tries to haggle me for whatever reason, I’ll just keep the car.
To the buyer, paying for the inspection makes him more invested in trying to buy the car. So it often helps the seller actually.
Perhaps I’m simply not versed in Land Cruiser communication, but it is a property of most cars that the service light ignites for a few seconds upon vehicle start up, then turns off – this does not indicate that there is a problem, and is more of a check to insure the bulb is operational. If the service light remains on, that’s what tells you the computer has picked up on a problem.
Sure, it’s a computer timed service light. I just didn’t realize I needed service after it had gone on. I think it has been on for two or three months. Not quite sure!
But once I get the service, I’ll surely be aware when it goes on next. Going for almost 3 years without an oil change is probably a bad idea. But, I think with only 12,000 miles in 3 years, it’s not so bad.
I am awful about checking oil and tire pressure routinely (now that the weather is getting colder I do need to inflate the tires).
That is ridiculous how quickly that need service light goes off. I too would have assumed that is part of the routine startup.
I hate it when I just miss out on a warranty especially if the deadline missed was due to procrastination. I had a GPS start going a bit whacky a month or so ago but didn’t really do anything about it till it got more problematic and made me want to fix or replace it. I checked the warranty and missed it by a little over a week (was a 1 yr one).
I always buy new cars because I know absolutely nothing about them and not confident in my DIY skills. Besides isn’t not doing car maintenance a good way to ensure division of labor.
Luckily I have a friend at the dealership so don’t think I’m getting ripped off which makes it easier for me to trust the dealer. Also I only buy Honda or Toyota brands. No American or German brands. Those are expensive to fix.
I have a lifetime warranty on my Honda seatbelt. It’s frayed from wear and tear so I brought it to SF Honda repair center. The manager told me I caused the damage by cutting it….!!!!!!!! It’s a $400 part so they know I won’t be suing them in court. I consulted a lawyer and he advised me against small claims court cuz they can bring a lawyer and I can’t. Ratted them to BBB and other state agencies… nothing.
While warranty sounds great they’ll make you go thru so much hoops and sometimes deny you of your claim. I am trying to make peace with this and supporting reliable mom n pops auto repair shops. Never trusting a dealer.
Hmmm… suing them in small claims court sounds extreme. How about trying to have a more meaningful dialogue to get them to fix it?
True about warranties making car owners go through hoops sometimes. Part of me wondered whether the dealer would honor replacing the fan.
These days, DIY for vehicles are easier than ever (counterintuitive, since cars are more complex than ever). for most makes and models, you can get a daignostic cable and free software to be able to diagnose any ‘soft code errors’ that don’t light up your dasboard. You can also nearl always find the .pdf shop manuals for your specific vehicle that give step by step instructions with pictures for pretty much ANYTHING related to your specific vehicle, including all routine maintenance and all repairs. By reading through the steps in advance, you can then decide whehter it is a project you want to tackle. You can then generally find almost any part you can possibly need, including OEM, online, at a fraction of the cost the dealer would charge. This way, you can even just bring your new parts to your indy shop and simply have them remove and replace the broken parts if you don’t tackle it yourself.
That is counterintuitive, but probably true.
Getting the part and bringing it in should definitely help save.
Regarding DIY, I don’t trust myself to do it right. Too much is on the line now with my family.
Great post! As you stated in the post its best to address the small problems soonest before they turn into bigger issues on down the line. Also overtime there is an issue with you car (assuming you have a warranty) You should always go over your warranty and see what is covers. Someone mentioned in an earlier comment and I agree wholeheartedly and practice this as well. You should always at least attempt to DIY. You tube and car forums are the best pace to get answers and or symptoms of car problems. However if the job seems to big always seek out a professional. True story. I tried changing my spark plugs on my 86 Toronado and ended up putting them back in the wrong order causing my engine to misfire. What I thought would be about $20 spark plug change ended up being a $200 job by the shop I took it to. #7 Don’t know my own car well enough? One thing I pride myself on doing is having the same car for 16 years (97 Mercury Mountaineer) it went kaput last year. Having the same car for so long allowed me to learn how to do a lot of things for that one model as well as learn the car inside out. When my Mountaineer broke down last year- Had a repair that cost more than the car itself) I went and bought basically the same car make and model. Now I have the same model but working car that I already know again :)
Oh man bummer about the warranty. I’ve had a couple small electronics stop working a few months after their warranty expired and remember being annoyed. Sounds like you did the best you could have with your car though.
How scary on your used 1989 BMW car experience. I have recurring nightmares about being in a car and the breaks go out. I can’t imagine going through that in real life!
And how strange on the indicator lights on your current car. I would not have interpreted that as it’s time to get maintenance either. I would have expected a light to come on and stay on while the car is driving! At least now you know!
After a car purchase at a dealership a few years ago, I heard the manager high-five the salesman in his cubicle. I feel your pain on that one.
Seriously. I can’t remember if the saleswoman high-fived the manager in secret coming out, not thinking I would see her, or whether she did it blatantly in front of me. It was in 2003, but I just remember what a fool I felt like that long ago. The saleswoman is still there too.
But the bright side is, I bought the SF 2/2 condo overlooking in the park in 2003, and it has done well. It also helped me come up with the 1/10th Rule For Car Buying so I would never feel that loserish feeling again when it came to cars.
And since the 1/10th Rule came out, that post has probably been viewed over a million times. So it feels good knowing it has helped folks not blow themselves up. And, the post has surely generated some ad revenue. Gotta always think positive!
Great article, two things to mention:
– #6, be careful trying to fix things yourself! I think it’s great to have a DIY mentality, since there’s opportunities to save money in the cost of labor. HOWEVER, I’ve seen my dad try the DIY method and take things into his own hands, only to mess things up even further and spend DOUBLE or TRIPLE the cost to fix his mistakes.. It’s all about knowing your limitations of what to fix vs what to pay to be fixed. Still love ya, dad!
– It may be helpful to keep track of the major car parts (for those that are interested in learned). I do this with my home – I have a spreadsheet with each appliance listed, the useful life, any repairs, replacement cost, etc. so I can budget for replacing them. You can apply the same approach to car parts to better estimate / prepare for potential repairs. This also comes in handy towards the end of the car’s life, where you can do a cost/benefit analysis for fixing vs. buying a new vehicle.
I agree. The last thing you want to do is spend time and money trying to fix something, and then have to bring it to a professional to fix what you tried to fix!
In my case, the car forums were just saying to check the engine oil and fill it up. So I knew I couldn’t do damage, only good, unless I filled up the engine too much. But at least I learned how to check my engine oil (seems so basic now), but I never bothered in 2.8 years of ownership b/c I just trusted the computer. But lo and behold, my engine oil was low.
Hey Sam great tips. I do most of my own basic maintenance and that is mostly from YouTube videos and subscribing to car forums. I mostly buy Japanese and in the 20 years I have owned 5 cars i’ve Probably only spent $1500 on services on labor (mostly attributed to jobs that are outside of my technical skill set). Sometimes buying OEM parts from reputable dealers and bringing them into my independent mechanic has saved me significantly. One example, I give all the time is for a simple oil change. When oil manufacturers run rebates I literally max out on buying motor oil and filters which come at a 25-40% savings. I then take them to my mechanic and he basically just charges me for 15 minutes of labor for getting my car on the lift and draining the oil. With the three cars I maintain a year this type of “hack,” really adds up!
Cool. I’d love to have a big garage with all the tools to just do all the basic service and general maintenance myself too. It’s fun to tinker if you know what you’re doing. Youtube videos have helped me a lot before with random car things and home maintenance stuff.
Alas, I realize I’m suffocating for time. That, or I just don’t want to spend much time outside of tennis, playing with my boy, and writing. Maybe during the holidays, when things ease up.
Luckiest thing I found was a reliable, reasonably priced mechanic. I have been going to this small family owned place for 25 years, and I have complete trust in them. Because I have a good mechanic I only buy used car, and would never buy a extended warranty. I also wait for the car to tell me if there is a problem. I never check the tires, oil or any other preventative maintenance. All of my cars do a good job warning me of issues.
The only reason you should buy a extended warranty is if you buy a high performance vehicle. These cars breakdown, and when they do they are extremely expensive. Several friends who had mid-life crisis car swear on the warranty, and have the bills from the dealer to back them up.
That is what I was going to say.
I’m not a big one on cars. If they run when they are supposed too, are comfortable, and don’t embarrass me in front of my friends, I’m good.
As a result of this, I am able to own cars much longer than any warranty could help me. The incentive to do this is because repairs tend to be far less than the costs of buying a new one . . . but only if you have a reliable, reasonably priced mechanic that you can trust not to rip you off.
Unfortunately, this isn’t something you can be sure of without a great deal of experience with the individual.
Similar thing happened to me but it was a silent malfunction that only revealed itself by a few drops of oil on the ground one morning. The malfunction was probably a few months old but took that long for the oil to show up. One month after the extended warranty expired and cost about the same to fix as the extended warranty was to buy.
To find such a problem on this low slung car would have required a jack or lift to get under it and have a look around….which I did early on and found a very expensive problem that was covered by the original factory warranty so at least all was not lost.
I had a thought on business deductibility…I think you can deduct car repair expenses but only if you bought the car for the business and account for all car expenses under the business. If you just expense biz miles but also use it for personal, the car repair expense deduction could be a red flag for an audit.