……….In another era the extended warranty might have been a reasonable investment to help protect your electronics purchase. Honestly, I have never purchased an extended warranty and I have never had an occasion that would have warranted an extension above and beyond the standard product warranty that was offered. In particular, with computers and the new televisions an extended warranty is nothing more than an increase in the overall price of the product. Warranties are based up on strict statistical testing and always favor the manufacturer, in terms of the cost versus the probability of an untimely failure. Barring serious abuse, any warranty of a year or more, should be sufficient to cover the item under the notion of a likely failure.

……….Some people out there, primarily the pessimists, are so sure that they are going to have an early failure that they will buy the extended warranty regardless. Someone like me, on the other hand, understands that over time they will have paid so much more for extended warranties than they will ever collect that if they saved the money they didn’t pay, soon they would have enough in an account to purchase a top quality product of their choosing. Back in the early 90’s companies like RCA would often be able to sell extended warranties that were actually close to the selling price of the television. In fact, RCA was so successful doing this that their profit extended warranty profit center was by far the most profitable across the company.

……….In the end the decision will be up to you and only you. I, for one, have chosen to turn down the opportunity to purchase an extended warranty. I understand that it is difficult to deal realistically with the unknown. Consider this, an extended warranty, if necessary, costs the company ultimately and keeps the product in your hands longer. The only way that for them to capitalize on the longer life of a product is to make some money off of your fearfulness. The product is going to last a number of years beyond both the initial and extended warranties. Thus, by selling a certain percentage of customers these extended warranties, the company is able to tap into an additional source of revenue. In some instances the only way that the company will generate new sales is when the customer feels that the old product is obsolete and requires a replacement.

……….You should look to your personal experience(s) and ask yourself if the peace of mind offered by an extended warranty is really worth the money spent. If it is, then by all means, go ahead and spend with a smile. On the other hand, if you see the logic in my argument, you may want to step back and reconsider your original position. For those of you who need some additional information, research the various product classes and find out about reliability and other product expectations. Publications like Consumer Reports can go a long way toward answering many of the questions that you might have with respect to an upcoming purchase.