A Wallet Shield Would be Better . . .

  • June 10, 2024

Fear is more than just the mind killer – to crib a line from Frank Herbert’s Dune books. It is also arguably one of the main reasons why so many people have so little money – because they’ve spent so much of it to ease their fear about the possibility of having to spend it.

Fear is what makes insurance such a profitable business – because there’s very little overhead selling fear. It’s not like you get anything in return for the money spent, after all. You can spend tens of thousands on insurance and have nothing to show for it.

Most people end up with exactly that.

Imagine being on the other end of that deal!

One of the worst such deals going – for the people who buy into such deals – is CarShield, which you’ve probably heard about because it’s almost impossible to not hear about it as CarShield ads are ubiquitous, especially on conservative talk radio. Which is one of the reasons why conservative talk radio is so obviously corrupt as well as terrible. The big-name millionaire hosts – Hannity, for instance – read ad copy for CarShield, peddling fear to people who can’t afford to pay for it.

CarShield putatively sells “vehicle service plans” that cover the cost of big-ticket car repairs irrespective of the age/mileage of your vehicle. Mark that. And think (the antidote to fear) about the shady no-exam-needed life insurance peddlers who promise to “cover” anyone who calls right now, even if they are 80 years old and have had three heart bypass operations already.

Similarly, CarShield says “get your vehicle covered by the ultimate in vehicle service protection before it’s too late.”

Italics added – and no exam needed.

Think (again) about this kind of deal. And then think about what Mark Twain said – about how difficult it is to cheat an honest man. These deals depend not only on fear but on the mark thinking he’s not the mark. CarShield peddles its “vehicle service protection” to people who think they’ll be able to get CarShield to cover the expense of a $4,500 transmission replacement for their 14-year-old vehicle with 185,000 miles that isn’t worth $4,500 itself – because they are smarter than CarShield; that CarShield is actually dumb enough to agree to such a deal – which is a deal of a piece with the “no exam needed” over-the-phone life insurance policies that promise $100,000 in benefits for only $100 per month!

The $100 per month being the only part of these deals that holds up. You pay, in other words – hoping you’ll be “covered.” They collect your payments . . .  .

CarShield promises that you’ll be protected from “expensive surprises”- and that’s true, in a way. You won’t be surprised by the expense of the CarShield service protection plan. The bill comes once a month.

Unlike the possible expense for a needed repair that may never come An expense that you’d probably have the money to pay for if it does come – if you hadn’t already spent it on CarShield’s “service plan,” which almost certainly won’t pay for anything expensive that comes up because that’s not how a business like this make money.

This is the key thing to think about when it comes to such “plans” – and to insurance, generally. It is a business that depends on odds that are almost always in its favor – and hence the offer. It is an offer that implicitly depends on you paying them and rarely them paying you.

This is something worth thinking about.

Also, this:

How much money would you have available to pay for “expensive repairs” if you put $100 into a cookie car each month for just-in-case? After just one year, you’d have $1,200 – and after three, you’d have $3,600. Money enough to just about pay for many – if not most – “expensive repairs” in cash. And the key thing to think about is that the odds are you will not have to pay for such an “expensive repair” over any given three-year period. This isn’t a supposition or even much of a gamble. It is an actuarial-statistical probability depended upon by outfits such as CarShield and the insurance mafia, generally. It is how these business make money. Which they do by not losing money. They depend on you losing money.

To them.

Yes, of course, it is possible you might have to deal with an unexpected “expensive repair.” Just the same as a 25-year-old might possibly have to deal with a major medical expense. But the odds are in your favor that such expenses will not arise – and if you don’t allow fear to cloud your judgment, the smart money is to save yours, in order to have it. Which leads to having more of it the longer you save rather than spend it. And that, in turn, leads to being able to afford to pay for “expensive repairs” if they arise.

And to being able to pay for other things – if they don’t.

. . .

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