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I live in an old house (by Arizona standards)- built in 1973. Just this year alone, I spent around 3000$ for repairs (a/c, gas leaks, electrical issues). At this point I'm seriously considering home warranty policy but there's just something about those companies that irks me. I'm afraid that they will take my money and then run me through hoops if I need anything fixed.
How much is the premium and what, exactly, does it cover ?? In my experience those premiums are usually $700-$800 a year, but there's a lot of exclusionary wording in there.
Did you just install a whole new a/c unit ?? Now the Electrical Panel is up to Code ?? Those are big ticket items you've already taken care of. How's the Roof ?? You might be better off putting the premiums into an Emergency Fund.
I'm probably looking at 750ish in premiums. Will need a new roof in 10 years at the most, if not earlier.
Will a home warranty cover a new roof though?
I've never heard of a home warranty that will cover a new roof.
And ultimately a home warranty doesn't save you any money. Repairs cost what they cost, and the insurance premiums are such that the company selling the policy will make a bit of profit (in aggregate, over all policies issued). They're mostly intended to be a stopgap for new owners who are temporarily cash-poor because they had to put most of their savings into their down payment; in the unlikely event they get hit by a big repair before their savings is built back up, the home warranty keeps them from not being able to afford the repair.
You should be saving about 2% of your home's value each year specifically to cover repairs. A new roof isn't exactly something that sneaks up on you.
I would just budget accordingly for unexpected big repairs and make small repairs on your own. We live in a hail-prone area so one would be lucky to last 10 years without roof damage.
I also am not a home warranty fan.
Save your money in a fund for repairs.
And as was pointed out, you've already done a few high-ticket updates/repairs.
Not that there couldn't be more.
But still once they're done -- they're done...could be for as long as you own the house.
And for the things that DO come up more frequently such as larger appliances it's usually better to save for future replacements. If you bought a new one on time and have paid it off, start putting the equivalent of the payment aside for the replacement.
They also tend to hire the worst contractors who are desperate for the business and try to upsell you. Then they put in the cheapest of parts or equipment. Not the people or what I would choose If I was buying.
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