| Warranty money not well-spent
This holiday season, shoppers are expected to spend a whopping $1.6 billion on extended warranties for appliances and such electronics as laptops and flat-screen TVs. For the most part, it won't be money well spent. Reliability data we've collected over the years shows that products seldom break within the extended-warranty window, which is typically three years. And even when electronics and appliances do break, the repair often costs about the same as the cost of the warranty. We've long advised against buying extended warranties for most products. In fact, we feel so strongly on the issue that we launched our first public-education campaign back in November, warning consumers not to waste their money on these service plans. Part of our motivation was the increasing pressure retailers are bringing to bear on buyers.
Extended warranty? It's seldom smart
This holiday season, shoppers are expected to spend a whopping $1.6 billion on extended warranties for appliances and electronics such as laptops and flat-screen TVs. For the most part, it will not be money well spent. Retailers are pushing hard to get you to buy extended warranties because these service plans are cash cows, often bringing in more profit than the sale of the item itself. Yet while extended warranties have proved a financial boon for retailers, they're largely a boondoggle for consumers. Here's why: - Reliability data we've collected over the years show that products seldom break within the extended-warranty window, which is typically three years. - Even when electronics and appliances do break, the repair often costs about the same as the cost of the warranty.
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