Should You Buy an Extended Warranty?
These days, you can purchase an extended warranty for almost anything: flatscreen TVs, laptops, smartphones, appliances, cars — there are an endless assortment of warranties available. Extended warranties are insurance for the product you’re buying, USA Today says. So how do you know when it’s smart to spend a little extra money on one, and when is it just a waste?
Here’s what to consider
Take into consideration the manufacturer’s warranty. They do vary, but most will offer a year on parts and three months on labor, USA Today reprots. As you’ve probably experienced firsthand at some point, retailers will push you to buy an extended service plan. It’s not because they think your product will break, but because it results in them making more money.
Data from Consumer Reports shows that products rarely break within the extended warranty window. And typically, most out-of-pocket repairs don’t cost much more on average than an extended warranty. To avoid purchasing an unnecessary warranty, do your research on the product before you buy. Make sure it’s reliable and has good reviews — it will make you feel better about foregoing the insurance.