Buying Electronics: Do You Need the Extended Warranty?
It happens every time you buy a new appliance or electronics. The salesperson will ask, "Would you like to buy the extended warranty?" Before you say "yes", there are some points you need to consider.
- Check your homeowner's insurance policy, which in many instances, covers some of your household's appliances and electronics. You may also be able to add your new purchase to the policy, which will likely cost considerably less than the extended warranty.
- Many credit cards also offer coverage for your new purchase if you use their card. Remember to hold on to your receipt and any manufacturer's warranty included.
- Compare product warranties. This is a must because warranties can vary dramatically – from 90 days to one year or longer. Keep this in mind when looking at similar products.
- Not all warranties offered by retail stores are the same. One store may offer you a 3-year warranty for $100, while another store sells them for $200. The cost of the warranty should be added to get a true total cost of your purchase.
- Always read the contract or terms of agreement. If your item breaks, will you have to take it back to the store, an authorized outlet or will a repairman come to your home? Also, what happens to your warranty if the company goes out of business?
- Know the manufacturer's warranty. Never pay for an extended warranty that begins the date of purchase. The factory coverage will begin immediately and may be good for quite some time. Paying for coverage that begins on the purchase date makes no sense.
- Go online and search product reviews. How well has this item performed in the past, especially recently? If the product breaks, will you buy a new one or have the one you have repaired? Is this a technical item that will likely be upgraded in a couple of years and won't be worth repairing if it breaks?
