When it comes time to get your next car – whether it’s a brand new one or a used one – there are a lot of things you need to consider during the purchasing process. Are you going to buy or lease? If you’re buying, will you finance your new car through the dealership, a bank or a credit union? What will your payments look like? What sort of taxes will you need to pay? How will this new car impact your current insurance rates? 

Among the questions you will have to ask yourself is whether or not you want to purchase an extended warranty. An extended warranty can help protect you down the road, but they aren’t right for everyone. Here are some things you should consider when deciding if you should get an extended warranty on your next car.

What is an Extended Warranty?

First, it’s important to know what an extended warranty is and what it covers. An extended car warranty is an optional plan you can purchase that will help to cover the costs of some car repairs. Typically, this warranty will kick in when your manufacturer’s warranty expires, but in some cases, they can overlap. 

Extended warranties often cover repairs such as flat tires or broken engines, but they don’t always cover every issue. It’s important when searching for an extended warranty that you read exactly what that warranty will cover and especially what it won’t cover. Also, make sure you search for automotive warranty administration services.

With an extended warranty, you’ll be protected should your car break down after your manufacturer’s warranty expires. When considering how expensive car repairs can be, especially when it comes to repairs on your engine or transmission, it’s no wonder that many people choose to get an extended warranty. 

How Likely is Your Car to Break Down?

To determine if you need an extended warranty, you should first think about how likely it is that your car will break down. If you’re driving a new car off the lot, chances are you won’t have an engine problem within the first few years at least. You could end up paying for a warranty that you will never need because the car is still new. 

On the other hand, if you’re getting a used car, this means they are more likely to experience some issues in the future. An extended warranty on a used car would make more sense, but they will also typically be more expensive. Everyone’s situation is different, so you’ll need to weigh the odds of your car breaking down versus the cost.

Weighing the Costs of Your Specific Warranty

Next, you will want to consider the costs of the specific warranty you want to get. There are all different kinds of extended warranties and the price will depend on the car you are getting along with what it covers. For example, the cost of an extended warranty on a Honda will likely be different than a BMW extended warranty cost. 

Once you know what kind of car you are getting, you can begin to explore the extended warranty options available to you. In many cases, the dealership will be able to provide you with an extended warranty, but you can also purchase them from a third party. You should explore all your options so that you can not only find one that fits your price but covers everything that you want. 

Research the Costs of Common Repairs

Finally, you should do some research into what it would cost for common repairs on your type of car. See what it would typically cost to rebuild the transmission, replace a flat tire, change the alternator and anything else you can think of. A good idea is to look up issues that are common for that specific make and model of car, then explore what it might cost to get them fixed in your area.

By figuring out the costs of common repairs, you can measure this against the cost of the extended warranty. Think about how much you’ll end up paying for the extended warranty by the end and see how this compares with a typical repair cost. A simple exercise like this can help to tell you if an extended warranty is a good idea. 

Is an Extended Warranty Right for You?

Extended warranties make sense in a lot of situations, but that doesn’t mean they are always right for you. The best thing you can do is consider the factors in your specific situation, then you can decide if the extra monthly fee is worth the financial protection you may need somewhere down the line.

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