Whether you just bought a computer, flat-screen TV or washing machine, chances are you were offered an extended warranty. Here are 5 tips to help you make the decision.

  • Retailers will push them. They make more money on the warranties than they do on the products themselves.
  • Know the difference between an extended warranty and a service contract. An extended warranty protects you against manufacturing defects; a service contract provides varying degrees of maintenance.
  • You probably don’t have to decide on the spot. Many retailers let you add extended coverage up to 30 days after your purchase. Go home and research the repair costs and track record of the specific item.
  • Not all warranties are alike.  If you think you do need one, be sure to read the fine print.  Don’t be afraid to negotiate with the retailer.
  • You may already have coverage. Your credit card company may extend the length of your manufacturer’s warranty.  Check before you shop.

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