Why I Pay for a Heating and Cooling Service Contract

Here's why homeowners should consider signing up for prepaid maintenance agreements.

As a homeowner, I'm well aware that my housing costs are by no means limited to my monthly mortgage payments. I also have property taxes and insurance to deal with, as well as home maintenance and repairs.

Working property taxes and insurance premiums into my household budget is easy enough, since those costs are mapped out for me on a yearly basis. And at this point, I've been in my home long enough that I can reasonably predict what my maintenance costs will amount to.

Home repairs, however, are the big wild card. Not only can repairs pop up out of the blue, but they can range tremendously in cost.

Through the years, we've had surprise repairs that cost us just a few hundred dollars, but others that have cost us thousands. And while I have an emergency fund for unplanned expenses like repairs, I prefer to raid that account as infrequently as possible.

It's for this reason that years ago, I opted to purchase a service contract for my heating and cooling system. And here's why you may want to consider one too.

The upside of a service contract

Your heating and cooling system can't just sit there neglected. Rather, it needs to be maintained so that it functions optimally.

That's why we have our heating and cooling system serviced every year. A professional comes in and checks all components to make sure they're working properly. That person will also, on occasion, make small fixes that prevent larger issues that are more expensive to repair.

Rather than simply pay for once-a-year maintenance service, I pay a little extra (about $80) for a full service contract. That contract covers the cost of one heating and one cooling system inspection a year, but it does a lot more than that -- it also entitles me to emergency service when something major arises.

A few years ago, for example, our heating system stopped working on one of the coldest nights of the year. Normally, an emergency house call would cost $250 just for a technician to show up to our door at 9:00 at night, and that's in addition to any necessary repair costs. But because we had a service contract, we were not only pushed to the front of the line so that a contractor arrived within a couple of hours of our call, but we weren't charged that $250 fee. Rather, we were only charged for the repair work itself. Based on that incident alone, the extra fee for the service plan more than paid for itself.

It's common for heating and cooling companies to offer service plans, and since we all rely heavily on air conditioning and heat, signing up for one could be very worthwhile. Even for non-emergency situations, our service contract entitles us to a discount on standard service calls. When, for example, our air conditioner recently needed extra coolant, we didn't pay full price to have that work done.

As a homeowner, you probably know all too well that surprise repairs can wreak havoc on your finances. Having a heating and cooling service contract has saved me money through the years, and you may want to consider one for that same reason.