We've all been there. You're just about to complete your transaction when the salesperson warns you of the countless perils that await your purchase if you don't protect it with the store's extended warranty. These warranties are, in almost all cases, bona fide moneymakers for sellers and risky, money-losing bets for buyers.
Consumer Reports senior editor Tod Marks hit the nail on the head back in 2006 when his magazine looked into the feasibility of extended warranties and found many simply weren't worth the paper they were printed on. In Marks' own words:
You're betting [the product is] going to break at exactly the time period between when the manufacturer's warranty expires. ... You're also betting that the cost of the repair will be more than the cost of the warranty. You're also betting that you'll want to get it fixed. Technology advances so quickly that new features, dropping prices, better products may mean it's preferable to buy a new item rather than fix the old one.
It doesn't make sense to buy a warranty on something that could easily be replaced out-of-pocket.