You have decided on your new car and are sitting down to sign the paperwork, excited that soon you will be behind the wheel of your new vehicle. The dealer brings up the subject of extended auto warranties. What do you do? Several things should be considered before you make your decision about warranties in this situation.

First, what exactly will be covered, and for how long a period of time? Usually a warranty will have a time limit or a mileage limit, whichever comes first. Secondly, how prepared are you to pay for potentially costly repairs, should they arise once the original warranty expires? Finally, would the peace of mind that you would have, knowing that you have an extended warranty on your car, be worth the extra expenditure?

For some people, this is the case. Others find that the extended warranties are more of a financial burden and do not cover enough to make them worth the money.