Blog

Should You Buy The Extra Warranty?

By Debt.ca on July 28, 2014 No Comments

Whenever you’re making a major purchase you’re often asked if you’d like to purchase an extended warranty. An extended warranty acts just like an insurance policy for consumer purchases – if your brand new washing machine or TV set stop working once the manufacturer’s warranty is up, you’ll still be covered

Retailers offer extended warranties for a good reason –they’re a great way to boost profits. Do you really think retailers would offer extended warranties if they were causing them to lose money? Of course not! Before you sign on the dotted line, take a moment to think. Here are a few reasons an extended warranty may not make sense.

The Manufacturer’s Warranty is Usually Good Enough

Almost all products from refrigerators to TV sets come with a standard manufacturer’s warranty. It’s pretty standard for the warranty to cover your purchase for parts and labour for a year. Since most consumer products experience minor break downs in the first year, while more costly problems usually happen many years later, an extended warranty is simply an overpriced insurance policy you’ll probably never need.

Extended Warranties Don’t Cover Everything

Before you sign up for an extended warranty, be sure to read the fine print. Extended warranties don’t necessarily cover everything – in fact, there are often many instances where you’re not covered. That’s right, your brand-new TV set might break down and you may not be covered even though you forked over $50 for the extended warranty.

Depreciating in Value

Have you heard of the old saying that a car loses half its value when you drive it out of the dealership parking lot? The same can be said for consumer electronics. With the advancements in TV sets, laptops and Blu-ray players, in two years’ time you may be able to purchase a brand-new product similar to your own for the same price as your extended warranty. Instead of wasting your money, pocket your cash instead and save it for a rainy day in case your new TV set dies.

You May Already Be Covered

If you are using a credit card to pay for your purchase, they might also provide insurance in many cases. If you pay for a product with your credit card, the manufacturer’s warranty is often doubled in length. How do you know if you’re covered? It’s important to read your cardholder agreement to find out or you can contact your credit card issuer. This should be more than enough coverage without an extended warranty in most cases. Using your credit card can also be a good way to earn reward points but it is always important to make sure you have enough funds to pay off your credit card in full after the purchase to avoid heavy interest.

Products Rarely Break Down on Their Own

Consumer Reports did a study that said between 5 and 37 per cent of small electronics and home appliances break down. In fact, many products break down through wear-and-tear and negligence, which of course isn’t covered under an extended warranty. Before you spend your hard-earned money, ask yourself if you feel lucky – chances are your product won’t break down any time soon!

Debt.ca

Admin


Tackle holiday debt now

By Rubina Ahmed-Haq on January 13, 2017

The holidays are expensive. We know that. According to a recent survey from savings destination RetailMeNot.ca, the average Canadian spent almost $1000 this past holiday season on food, drink, travel and gifts. Another survey by PC Financial finds 77 per cent agree the holiday season tends to be more expensive than planned. If you went over…

4 Money Moves You Can Do To Start The Year Off Right

By Andrew Daniels on January 2, 2017

With 2016 in the review mirror, it’s time to turn our attention to the amazing year ahead, and see what 2017 has to offer. With all of the possibilities and opportunities it’s hard to know where to begin. To make the most of your money this year, make sure to get these money items off your checklist…

How to Set New Year’s Financial Goals and Actually Stick to Them

By Jordann Brown on December 27, 2016

As the New Year approaches many Canadians will begin planning their resolutions, and many of those resolutions will be financial in nature. Money-based resolutions are the third most popular type, yet only 19% of Canadians keep their resolutions for the entire year. That’s because setting a goal is one thing, but sticking to it is…

Things You Should Always Buy at a Dollar Store

By Amanda Reaume on December 15, 2016

Dollar stores are great places for thrifty shoppers, but anyone who has ever used a dollar store cotton swab knows that there are just some things that you shouldn’t buy there. So, what should you be buying at a dollar store? As someone who has saved hundreds, if not thousands of dollars by shopping at dollar stores over…

No Comments Leave a Comment  

Leave a Comment

Free Savings Estimate

How much do you owe?

$100,000

$5,000
$100,000
Live Chat
Welcome to our Live Chat
Agents are not available at this time. Please leave a message. Thank you.
First Name
Last Name
Phone
Email
Postal Code
Debt Amount
 
PHP Live! powered