Q:I just bought a cell phone and got the extended warranty for $99. Then I bought a $150 back-up hard drive to use at home, and decided not to get the extended warranty. But I honestly don’t know whether either decision was right!
Blue Avocado Personal Finance– I know the feeling: standing at the checkout line and the question catches us off guard â€“ â€œWould you like to buy an extended warranty with that?â€
Even under an extended warranty, your gadget may not get fixed. The most common reasons products break –"normal wear and tear" and accidents–are seldom covered. And guess who gets to define â€œnormal wear and tear.â€ Extended warranties make a bit more sense with big ticket items such as cars and stoves.
The best way to extend the warranty on your gadget is to purchase it with a credit card. Many credit cards, such as American Express and Visa, automatically double the manufacturer’s warranty as part of their service. Check with your credit card company and see if they offer the warranty extension. To be eligible for protection, you’ll need to fill out the warranty or product registration card when you buy your product and you’ll also need to keep a copy of the original receipt.
When something breaks outside of the regular warranty, call your credit card company (Visa: 1-800-882-8057; American Express: 1-800-225-3750). You’ll report your claim and have to fax them a copy of your original paperwork. Most likely they will ask you to bring in the product to a repair shop and get an estimate before they will reimburse you. The process is typically not very difficult â€“ but if you don’t have your paperwork, you can’t even get started. (If this sounds difficult, it isn’t any easier with an extended warranty.)
Stores make money by selling extended warranties, but they usually are not worth the money because products are far more reliable today than in the past. A Consumer Reports study showed that the likelihood that a digital camera will need repair in the first three years is just 8 percent.
The simple answer to that inevitable checkout line question is â€œNo.â€ Save your money. And enjoy your purchase!
P.S. When you buy something, enter it Outlook with the date purchased, model number, serial number, help information (such as a website) and most importantly: where you’ll be storing the receipt.