Finding Coverage That's Right For YouYou've seen it happen time and again.

A new business launches with a prosperous bang and high expectations, only to collapse mere months later with a bankrupt whimper.

A marriage begins with intimate glances and fervent I love yous, but quickly devolves into icy glares and loud, angry talk of divorce.

Clearly, situations that start out swimmingly can sometimes end in an unfortunate, premature way. But that doesn't have to be the case when it comes to the relationship between you and your car; there's an auto warranty designed to help that situation live up to your expectations. It's called an extended warranty, and it can help make sure that your car doesn't degenerate from prized possession to cumbersome money pit.

In essence, an extended warranty is an insurance policy on your vehicle, a safeguard against expensive, unforeseen repairs. The term extended warranty is actually a misnomer, since, in the strictest sense of the word, these aren't warranties at all. Like auto warranties, they cover repairs and/or regular maintenance for an agreed-upon period of time. True warranties, though, are included in the price of the product; extended auto warranties are really service contracts, since they cost extra and are sold separately.

An extended warranty may be purchased at the time you buy your vehicle; it's also possible to purchase one much further along in your ownership experience. If you're the type who likes to be prepared for all eventualities, an extended auto warranty may be just what you're looking for. Bearing in mind the ever-increasing cost of vehicle repairs, these service contracts can make a lot of sense.

In deciding whether an extended warranty is right for you, and in selecting the best plan for your needs, you'll need to ask yourself the following questions:
To what extent is your vehicle already under warranty, and is this coverage in sync with how long you anticipate owning it? If the car you've just bought is new, take a close look at its factory warranty before making an extended warranty decision. If, for example, the vehicle has a factory warranty of three years or 36,000 miles, and you plan on keeping it for two or three years — with an anticipated annual mileage of about 10,000 — then an extended warranty makes little sense, since you'll likely be covered under the manufacturer's plan. However, if you plan on keeping the car long after the factory warranty expires, an extended auto warranty is worth considering. If the car you've just purchased is used, you'll need to ascertain if there is warranty coverage from the dealership (coverage periods may range from as little as a month to up to a year, or more). If you're buying a late-model used vehicle, it's possible that the vehicle's original factory warranty is still in effect (this will be dependent on how many miles the car has under its tires, and on how much time has passed since it was originally titled). Some manufacturers also offer "certified used" programs that extend original factory warranty terms on pre-owned vehicles. If the car isn't under warranty, or if you plan on keeping it past its warranty's expiration, an extended warranty makes sense.