Any time you need to hire a contractor or a skilled tradesperson to work on your home, you have a right to be skeptical.
Money expert Clark Howard is so skeptical that he advocates for an extensive process before you even hire a contractor. So when your HVAC person pitches what amounts to a subscription plan to you, it’s understandable that your initial reaction may be distrustful.
However, this is an atypical circumstance, as I’ll explain in this article.
Should you accept this type of offer? That’s what a listener of the Clark Howard Podcast recently asked.
Why Clark Thinks Pre-Paying for an HVAC Service Plan Is a Good Idea
Should I accept an HVAC service plan that requires me to pay ahead of time?
That’s what a listener wondered on the June 5 podcast episode.
Asked David in Alabama: “Are HVAC paid service plans worth the cost? I received a quote for $16 a month for two inspections/preventative maintenance services annually.”
The offer David received costs $192 per year. You should get your HVAC unit inspected every six months anyway, Clark says. Once in the spring and once in the fall, typically near the time you’re switching from heat to A/C and vice versa.
“Because they want renewals, they’re going to call you and schedule with you your spring and fall inspections,” Clark says. “If you are left on your own and you’re not signed up with any plan, you’re the one who has to remember to sign up for them.
“I know how flaky I am. I would never remember to call and have them do it. And so them saying, ‘Hey, Clark, it’s time to set up your appointment,’ it works for me.”
So with an HVAC service plan, you’re pre-paying for something you need to do anyway. And the burden of scheduling these appointments usually moves from your shoulders to the company.
The Hidden Reason Why These HVAC Service Plans Are Valuable
But that’s not even the main reason Clark likes these plans. The company gets the benefit of getting recurring up-front revenue that it can rely on, evening out the seasonality of its cashflow and making it easier to project business needs.
For that benefit, they typically offer you what Clark labels a “bribe.”
“It’s the avaiability of service to you with a guarantee,” Clark says. “Because you don’t want to be there freezing in the winter or boiling hot sweating in the summer.
“Usually there will be a written service guarantee that they will be there within X number of hours [if something breaks].”
Depending on where you live, you certainly don’t want to be left without heat or A/C for days at the wrong time of the year. Thankfully, this type of pre-paid plan typically serves as a “jump to the front of the line” card.
We often take our HVAC unit for granted. We may even lament it, as it’s one more bill we have to pay — a bill that tends to get more expensive during the upcoming summer months.
However, it’s always nice to be inside a climate-controlled residence. Especially when the weather gets unpleasant.
Like going to the dentist or getting an annual physical, there are some preventative maintenance items in life that are easy to overlook. They often are inconvenient or even uncomfortable. But checking those boxes can save you greater headaches down the line.
Pre-paying for HVAC service ensures you don’t forget to check your heat and A/C twice a year. If you’re lucky, those plans also allow you to get quick service if something were to break.