5 Reasons You Don’t Need an Extended Warranty
Your purchase will likely come with other protections.
the main points
- Extended warranties don’t cover everything that can go wrong with your purchase, and they’re expensive to run.
- Your purchase will likely come with a manufacturer’s warranty, and the retailer you’re buying from may also stand behind it.
- The best credit cards also offer purchase protection.
Quoting classic American cartoon character Homer J. Simpson, “Extended Warranty?! How could I lose?” Well, with the purchase of the extended warranty, you will most likely lose money, and possibly also your precious time.
If you are purchasing a new home appliance or consumer electronic item, such as a computer or smartphone, you will likely get an extended warranty at an additional cost. Extended warranties are available on many items, but these are the most common situations in which you are required to purchase one. Not even Amazon shopping keep you safe from this offer; I get routinely asked about buying one during the Amazon checkout process (and on a variety of items, most recently on a new power adapter I bought for an external hard drive). Extended warranties differ from the current manufacturer’s warranty (more on warranties below), by offering to cover your purchase against breakage or other damage for a longer period. Sounds good, right? Well, not necessarily.
1. Extended warranties are expensive
The Guarantee Week newsletter noted in 2017 that extended warranties were worth $40 billion a year. That’s a lot of money to spend protecting new manufactured goods, most of which will almost certainly be in good working order for at least the first part of their useful life (and the item will likely be under warranty anyway for that period of time). If you’ve already started getting a new clothes dryer, do you really want to incur the extra cost for a service that may not be necessary? In addition, the cost of paying for the repair is likely to be lower than the cost of the warranty, According to Consumer Reports.
2. Extended warranty coverage may not be applicable in all situations
Extended warranties don’t cover everything that could go wrong with a new purchase, and if you’re thinking of buying one, it’s a good idea to look through that fine print to see exactly what they’ll cover. As noted before Federal Trade CommissionExtended warranties may also have specific requirements for maintenance or care of the item, and if it breaks, the company may be able to blame your use or improperly maintained it, and then deny coverage.
3. Your purchase likely comes with a manufacturer’s warranty
Most appliances and electronics, small and large, automatically come with at least a manufacturer’s limited warranty. Every toaster or vacuum I buy seems to have warranty information right on the box, or sometimes printed on the back of the user manual. to me Consumer ReportsThese warranties usually last around 90 days, and even after that period, you might not be so lucky. It’s good for customer service to honor a warranty after expiration, and many companies like the boost this move can give their brand (especially in these days of social media, where you can tweet a manufacturer directly in a public place).
4. May your credit card protect you
The final reason why you don’t need an extended warranty is related to the payment method you used for the purchase. If you used a credit card for it, you may have up to Additional warranty through the card issuer. Credit card protection It often outweighs the manufacturer’s warranty, so read the fine print for this cardholder benefit, which may cover an item that’s broken, stolen, or has another mishap. the The best credit cards There are great perks that you may not be aware of, and it pays to use them when you can save money and headaches.
5. The retailer may take back the item
If all else fails, if it’s been a while since you bought the item and it broke, you may even be able to get a refund from the retailer that sold it to you. Return policies vary, but many retailers stand behind the products they sell. Costco is an example A real life retailer.
Still considering this extended warranty? In addition to the reasons above, you probably don’t need it, remember that you can save money that you would otherwise have spent on it emergency fund, in case your new oven or dryer needs repair. Otherwise, using the right credit card to purchase a reputable product from a good retailer can go a long way to ensuring that you don’t need an extended warranty.
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