should i buy the aftermarket warranty?

[Brucelee]

"So many times I have heard the advice to take the money you'd spend on a warranty, and put it in an interest bearing account to be used towards future maintenance...and you'll come out ahead.

I don’t know if this holds true for an expensive-to-maintain car like a Porsche. But, that's what I am planning to do."

This scenario works out fine if you are looking at say a sample size of 1000. That is the way insurance works, it is the SPREADING of the risk over a larger payer base.

However, on an individual basis, this "put the money in the bank approach" is not valid from an actuarial basis. If you are the ONE, you have just lost your shirt.

To wit,

say 1 out of 1000 folks will need a new engine and you are the one who needs it, the $2000 that you put in the bank will not cut it.

Let the good times (and dice) roll.

Richard, on a new Boxster, an extended warranty is more like $4,000. If you put that money aside, when the Porsche factory warranty ends, you'll have about $4,700 (assuming a 4% yield) for maintance repaires.

Like I prefaced in my post, I am not sure if this holds true for the more expensive than average P-car maintance.

You are right about the sample size. For example, if everyone on this forum sent you $2K for an extended warranty, that would be about $7,000,000. That would cover a lot of potential claims, including 3.5 blown engines (using your example of 1:1,000).