What do you think about paying extra for an extended warranty on a purchase?

Answer 1

Always a bad idea. Companies make tons of profit on selling extended warrantys. Extended warrantys are very profitable because most people will never use them, they are too difficult to redeem, or hidden terms anc conditions that leave you with no coverage. Usually, these are just the same as the manufactures warranty (that you get for free) just for a longer period of time. Consumers get lied to by commissioned sales people all the time about what is covered under these plans, and when they need to use the warranty years down the road the sales person is long gone. Consumer reports advises against buying these for a good reason.
I've worked for 8 years in consumer electronics and know the game very well. We can effectively increase the profit of a low margin item by selling the extremely profitable extended warranty. We can even get fired by not selling these. The worst has to be on computers. Some places will fire you if you can't sell the extra warranty. cell phones are pretty bad too.
If your pressed to buy them, just look confused and ask the sales person; "I thought you said this was a quality ____, why do you think it's going to break? I'm going to have to think about it". That should shut them up.

Answer 2

It depends upon the item. Most electronics (with circuit boards) either fail right away, or after a fairly long time (look up bathtub curve on http://en.wikipedia.org/wiki/Bathtub_curve to see this phenomenon described.
If the item involves new technology, then an extended warranty would probably be wise. Think first model years for autos as a good example; most problems occur with these cars as the automakers work out the "kinks" with the later model years as they get consumer feedback and large scale use information. It is a similar situation with new technology items (plasma TVs).
Bottom line is whether or not you can afford to replace the item when it fails and if the extended warranty is a savings when compared to repair and replacement (think auto insurance as a good comparison). Hope this helps!

Answer 3

I "Weigh" the price of the item and the replacement expense in a five year window of time. [that is the average length I use a large item] If your replacing it next year with the latest and greatest then don't bother.

So for example: My SUV, Refrig, TV and other large appliances all have warrenties by the manufactuor and often from the place I purchase it. on average 3-5 years.

I have used them several times and it averages out tobe the price of the warrenty is about 1/3 or 1/2 of the total value of the replacement cost, so it was a great deal.

The repair work on my Car, dishwasher and dryer- worth it, paid for its self on the very first visit.

TV was actually replaced at the end of the two year warrenty and the new one got replaced 18 months into it (same flaw- go figure) so I got another TV (upgraded w/ warrenty) for that one= 3 tv's for the price of one and $99 warrenty. It was actually wonderful, the technology upgraded each time and it was all covered in the warrenty.

Just read them and keep them "handy", put a sticky note on the calendar a month or two before it runs out.
It is like Insurance for the item, on top of real home owners insurance. Best wishes.

I am all for it. Just consider "what is right" for you.
Also- that is not taxable in most states, so WATCH them with they add the ticket up. Make sure its not included in the price of the item.

Answer 4

Before I commit to anything I weigh up the cost of replacement against the cost of extending the warranty.

Answer 5

It's usually NOT worth it...-especially with appliances. However, if you have a family of 9, & you KNOW that the Washer, or Dryer, or Dishwasher is going to be running constantly- THEN I'd go for the extended warrenty. If your useage of something is high- go for it. But if it's average or less- don't bother.

Answer 6

you have a lot of rights automatically (consumers act) but if you have a problem you may have to fight it ,, with extended warranty problems are less an issue , the retailer can pass your problems to a third party and work for you ,, you just have to weigh up the cost of warranty and peace of mind ,, for me i dont mind a fight sticking up for my rights, but that is not for everyone

Answer 7

Almost always a bad deal. In fact, the profits are often exorbitant. The sellers think you can't do the math.

Answer 8

it depends on how much you can afford, and what the item is, but i think it is good for an extra peace of mind.