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If you’re planning to buy a big-screen TV or home theater equipment, here’s a tip: Don’t buy the extended warranty.  

Electronics retailers push those warranties hard. That’s because they can make a huge profit by selling you a warranty you’re probably never going to use.
My friends in the electronics industry say TVs, computer game consoles, stereos and home theater equipment are made so well that it rarely breaks down. And when it does, it’s almost always within the first 90 days of purchase.
Those first 90 days are covered by the manufacturer’s warranty that automatically comes with the TV and doesn’t cost you anything extra. In fact, most manufacturers’ warranties cover the equipment for a full year.
If you add on an extended warranty, you’re going to pay $100-plus to insure the piece in case it breaks down more than a year from now but before the two- to five-year period the extended warranty covers.
What are the chances?
For the retailer, the profit margin on the extended warranties can be greater than the profit margin on the TV itself. So save your money.
Here are a few more tips: 

  • One extended warranty that might be worth it for the bulb in a mounted projection system for a home theater. If you use the system every day, the bulb, which will last for around 2,000 hours, could burn out a couple of times a year, and it will cost you $300 to $500 to replace it.
  • If you’re really uncomfortable without an extended warranty, buy your TV from Costco, which automatically gives you a two-year warranty—double the length of the normal manufacturer’s warranty.
  • Don’t buy a TV over the Internet. Several of the big TV manufacturers will honor their own warranty only if you buy from an authorized dealer. You also could wind up with a refurbished product rather than a brand-new one.
  • Pay for the item with a credit card that automatically offers an extended warranty. Some gold and platinum cards lengthen the original manufacturer’s warranty by up to a year. 
  • Investigate the quality of the brand you’re buying. Some manufacturers have a reputation for making durable products, while others sell stuff that’s prone to breaking down. The better the product you buy, the less likely it will need expensive repairs. 
  • Sanderson Ford

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