“I pay $25 a month to worry less about my furnace—is it worth it?”

For this week’s No More Ls column, we’re looking at the costs of HVC maintenance plans and if they’re really worth it.

Would you ever write a love letter to a furnace? No? I wouldn’t either, but that’s exactly what Canadian author Alexander MacLeod once did. After he was shortlisted for the 2010 Giller Prize, MacLeod wrote a beautiful essay about using his boosted income to upgrade his woebegotten furnace and other infrastructure in his older home. Not exactly an exciting purchase, but a satisfying one all the same. “Nobody feels a giddy surge of excitement as they ‘save up’ for a replacement breaker panel,” he wrote, but “making our house work the way it’s supposed to ranks right at the top of my proudest financial achievements.”

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MacLeod tapped into something important, though. A furnace isn’t just a furnace. It makes our homes feel warm in more ways than one. But caring for HVAC systems (heating, ventilation, air conditioning) feels far from poetic. How, exactly, does a furnace work? What makes an air conditioner suddenly clunk out? And what financial catastrophe awaits me if I don’t understand?

A bit of maintenance can save big future problems

This combination of poor knowledge and uncomfortable uncertainty probably motivates a lot of Canadians to sign up for HVAC maintenance packages. I’m one of them. The plans, which cost about $25 a month, promise customers an annual maintenance visit, additional discounts, and priority service.

It sounds like a great deal and, seen through a certain light, it is. Paul Boyer agrees; he is an operations manager for two Ottawa-based HVAC companies (Francis Home Environment and Anchor Home Comfort) and a former service technician. “Routine maintenance helps identify and address minor issues before they develop into more significant failures,” says Boyer. “Beyond preventing potential failures, annual maintenance also provides the customer with confidence that the equipment has been inspected, is operating as intended, and is safe to use heading into the heating or cooling season.”

He compares the experience to that of getting an annual physical at the doctor’s office. Nobody wants something to be found but if there’s an issue, it’s good to address it early on. As he puts it “That’s better than the alternative.”

This is exactly why I signed up for an HVAC maintenance plan. Having one has made me feel more organized, more responsible, more of an adult. Surely everyone feels the same way?

Are you worrying about problems you don’t have?

​Not exactly. I spoke with an HVAC mechanic and business owner I’ll call “P”. He asked for anonymity for job security. P didn’t mince his words when he told me that these plans were “a complete rip off.”

A standard maintenance visit typically costs under $200, far less than the roughly $300 annual cost of the plan, he suggests. And those visits might not even be necessary. Plus, many of the included services are things homeowners can easily do themselves, while others are completely nonessential.

P also asserts that if you’re not having any concerns, booking a maintenance visit every other year is more than sufficient. He also pointed out that most HVAC components already come with some built in peace of mind: Impressive warranties of five to ten years (or even more—just don’t forget to send in your product registration card).

Have you been red tagged?

Another problem I hadn’t considered: Technicians searching for problems that weren’t causing any issues until someone looked for them, he shared. P is concerned that overzealous mechanics, keen to generate more sales, discover issues that aren’t really problems to begin with and the result could lead to what’s called “red tagging.” That’s when the tech forces shutdown of a system for safety concerns.

However, it’s worth noting that Boyer disagrees. He asserts that it’s a common misconception “that technicians are primarily there to red tag an appliance so the customer will be forced to replace” but that isn’t the case in his experience.

Got a red tag and wondering if it’s a scam? Get a second opinion.

There’s no guarantee—no matter what you do

One thing that everyone can agree upon? Even with regular care, HVAC systems can fail at any point. As Boyer puts it: “Consumers should understand that maintenance does not guarantee an appliance will not fail. HVAC equipment contains numerous mechanical, electrical, and electronic components, and some components can fail unexpectedly without any prior indication.” As my other source told me, it’s like having your mechanic take care of one part of your car, and soon after, something else needs attention. It happens.

That emergency fund: How to save for maintenance costs

So what is a frugal, warm-house-loving person to do? If you’re reasonably handy and don’t mind paying for stand-alone visits as needed, you can save thousands over the life of your furnace by eschewing the maintenance plans. But who among us is apt to be so organized, accountable, and self-motivated?​ I spoke with two financial experts about finding a balance between the reassurance that plans provide, the flexibility which comes from taking a different approach, and the general stress of determining what’s worthwhile.

Robin Valadares, a certified financial counsellor, shares that choosing to subscribe to home maintenance programs or not often comes down to having some tangible cash savings versus what he describes as the “sleep at night” factor, saying: “It’s that peace of mind when the middle of winter on December 24, when you have to call, you know it’s going to be sorted out, and you don’t have to host Christmas in the freezing cold.” That comfort is a very powerful thing. However, there are many ways to achieve it. If you find it easy to pay an external bill but much harder to commit $25 to your own savings account, Valadares notes there are a host of programs that essentially remove the “you” component from your savings equation via automatic transfers and investments.

No matter which path you choose, don’t discount the necessity of saving in some capacity. Sandy Yong, a certified financial education instructor stresses that home maintenance is essential. “It’s important for homeowners to set aside a dedicated savings fund for home maintenance and repairs.”

Should you get an HVAC plan?

Some financial choices are clear-cut. Others, like this one, are in the murky middle. Get a maintenance plan? Avoid them? Drive yourself crazy trying to analyze the cost-benefit analysis of $25 a month? I think the best answer is that you deserve peace of mind, and what that means for you might be very different from what it means to me.

It’s an elusive feeling to capture, hard to define, but I think MacLeod just about nailed it when he wrote: “I twist the tap. I click the thermostat. I hit the lights. And I think: thank you, thank you, thank you.”

Read more from this issue of The Get:

1. How to stop yourself from shopping on your cell phone 
2. The risky business of hype buying and resale in Canada
3. Why Bruce Sellery says the 30% rule may be irrelevant
4. What are my options for building real wealth without the stock market?