To make up for sluggish sales in this sagging economy, retailers are expected to hammer customers heavily this holiday season with extended warranty offers.
In years past, Best Buy has made a half-billion dollars A YEAR in sales of extended warranties ALONE.
But these service plans are not always a good deal. Here's what Atlanta-based consumer advocate Clark Howard (www.clarkhoward.com) says you should follow:
* NEVER BUY FOR COMPUTERS, VCR'S, DVD PLAYERS. Howard says these electronics depreciate so fast, it'd be cheaper to buy a new one than to pay for a warranty to fix it.
* NEVER BUY FOR KITCHEN APPLIANCES. Howard says only 12 to 20 percent of the money spent on extended warranties for appliances is ever used to make a repair.
* FOR CARS, DO NOT BUY "THIRD-PARTY" WARRANTIES. Buy only the manufacturer's extended warranty or one sold by your insurance company, and even then, make sure it kicks in after the initial 3 years/36,000 mile FREE warranty expires.