When to signup for extended warranties

This will be a short post since there are almost never any valid reasons to pay for an extended warranties. Like insurance, you should only pay for something that will financially devastate you if you have to replace or repair it. That financial devastation will not happen with electronics or cars, so don’t fall for the hard sell. These warranties are setup to benefit the retailer, not the consumer. They wouldn’t offer them if they weren’t hugely profitable for the retailer.

If you want more details about why they are a bad idea, Consumer Reports covers it thoroughly.

I have found a single instance in my life where it consistently pays off. Bluetooth earbuds that are used for working out and have to withstand significant sweat are almost always going to fail within one year. The design challenges of blue tooth, coupled with water and rough treatment are a bad combination. If you know you will be very hard on the earbuds and use them extensively, buying the extended warranty from the retailer (Bestbuy, for example) or from Square Trade will almost always pay off with multiple replacements at no cost or hassle to you.

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