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You complete your purchase of a brand-new laptop and the retailer looks at you quizzically while ringing it up. “Didn't you want the extended warranty on this?"
"No, thanks,” you reply. “The salesperson already asked me about it."
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But now you're second-guessing and feel foolish: “OK, I guess I'll take it.” So, the big question remains: Should you pay for that insurance policy, of sorts, in case something goes wrong with your gear down the road?
Save your money, according to editors at the nonprofit Consumer Reports (CR) magazine. Those who buy extended warranties and service contracts for electronics rarely use them for repairs.
This data was collected from a recent CR survey about laptops that many of its members completed. The consumer advocacy organization based in Yonkers, New York, has given similar advice on appliances, desktop computers, tablets and televisions.
What's more, the same laptop survey found that the vast majority of repairs were made while items were still covered under a factory warranty.
Insurance, repair costs similar
Interestingly, the median cost of an extended warranty or service contract is about the same as the median cost of a single repair, says Christopher Raymond, Consumer Reports’ deputy technology editor. However, an extended warranty might make sense for some something small and portable, such as a smartphone.
"The bottom line [is] if you have a habit of dropping your phone, it might make sense to spring for the added protection,” he says. “Otherwise, put the money into your savings account just in case you need it. The stats say you'll probably get to keep it."