When you buy a new appliance, you're usually offered an extended warranty. But do you really need it? Here we discuss whether the extra expense is worth the money.
Are you in the market for a new appliance? You'll likely be offered an extended warranty by the salesperson, which may sound like a good way to cover any mishaps, but it's not worth the extra money. Here's why.
According to a recent study from Consumer Reports, most products seldom break during the two to three year window covered by an average service plan. Then, when they do break, your repairs tend to cost as much as the plan itself. Keep in mind that the manufacturer will sometimes cover out-of-warranty items, as well.
If your appliance breaks down within a short amount of time or because of a known issue, the manufacturer will usually offer free discounts or repairs, if you contact them for help. Another thing to consider is the extra charges associated with extended warranties. Some repairs call for the item to be shipped to the manufacturer, which typically isn't covered by the company. In other cases, you may be required to pay a service charge when someone comes to repair your appliance.
Extended warranties aren't the best deal for consumers, but salespeople have a reason for pushing you to buy one. Consumer Reports says that most retailers keep 50 percent or more of what they charge for these kinds of plans.
Bottom line: extended warranties aren't worth it. Keep these things in mind the next time you're shopping for an appliance and save yourself from unnecessary expenses.