If you're interested in buying a car, you probably know that the process involves several twists and turns, including a few minutes with the dealership's F&I (finance and insurance) manager, who will likely offer a series of extras and add-ons you can choose to buy. Should you do it? We take a look at whether these dealership extras are worth the extra money.

Extra Examples

A car's sticker price, or even your negotiated price is rarely the end of the story. There are almost always taxes and fees that will boost the final price, as well as a long list of dealership extras that can increase your out-the-door price even more.

One example of such an extra is an extended warranty, which is offered at added cost to car shoppers who may keep a car past its original warranty period. Extended warranties cover additional items that may break even after the warranty has expired.

Vehicle appearance upgrades are another common dealership extra. For example, a dealer might apply a window tint, special wheels or unique pinstriping to a car or truck and then increase the price accordingly. Some dealerships also offer rust-proofing or paint protection.

On the finance side, some dealerships will offer extra insurance. For example, a dealer may try to sell you a life or disability insurance policy that will pay off the car in case the primary owner dies. Dealers will also sell gap insurance, which protects you in case you end up underwater on your car loan (meaning that you owe more on the car than it's worth), then have an accident. You're still obligated to pay off the loan, but your insurance company may not think the car is worth what you owe. That gap can prevent you from having to pay money out of your own pocket in case of an accident. 

Beyond these common extras, we've also heard of a few others, including road-hazard warranties -- which cover your tires in case you have a flat -- and vehicle-theft tracking systems, such as LoJack, which can help find your car in case it's stolen. Also often available are all-weather floor mats, which can help protect the car's original carpet mats.

Worth It?

With so many dealership extras to choose from, how do you know when it's a smart idea to choose one? Our advice is simple: It often isn't, but you should weigh your options carefully, regardless.

Extended warranty is a good example of this advice in action. Before agreeing to any extended warranty, ask yourself whether you plan to keep the car beyond its manufacturer warranty period. If you don't, there's no need to spend any money on an extended warranty.

If you do plan to keep the car, find out what the warranty covers and how much it costs. You also need to consider exactly how reliable your vehicle of choice is. It's probably a bad idea to spend several thousand dollars on a warranty that covers only powertrain components in a reliable car, but spending the same several thousand dollars on a bumper-to-bumper warranty for a high-end luxury car may be a smart strategy.

In terms of appearance options, you should never pay the dealer's asking price for an item you didn't ask them to install. Do you like the aftermarket wheels they've added to your car? If not, have them swap back the original set. Same goes for any sort of pinstriping or chrome trim. We also strongly suggest skipping rust-proofing and paint protection altogether, as most cars come with this from the factory.

In terms of insurance, we're usually skeptical, but it can be a good idea depending on the cost. We suggest you consider, for example, how far underwater on your loan you are and how far underwater you're likely to get as your car depreciates. Next, consider the cost of the gap insurance. Spending $2,000 to insure $5,000 probably isn't a great idea, but spending $200 for the same amount may be a smart move. As for disability or life insurance, we say skip it; you can usually find it for less money somewhere else.

When it comes to the last few extras we've listed, we once again suggest using your discretion and spending some time thinking about your own situation. For instance, is your car so likely to get stolen that it's worth spending a few hundred dollars for a tracking system? Do you have flat tires so often that a road-hazard warranty may be worth it? And do you often work in muddy or dirty conditions that would necessitate a set of all-weather floor mats? If the answer to any of these is yes, opting for this type of dealer-installed extra might be worth it.

In the end, dealer-installed extras may seem tempting, but they can add up quickly when you're buying a car. So stay smart and evaluate what you really need before signing the papers.

author photo

Doug DeMuro has a wide range of automotive industry experience, from work at a Ferrari dealership to a manager for Porsche North America. A lifelong car enthusiast, Doug's eclectic vehicle purchases include a Porsche 911 Turbo, an E63 AMG wagon, an old Range Rover and a Mercedes Benz G-wagen.

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