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PFT #45 - Personal Finance Tip: When it Makes Sense to Purchase a Product Warranty

Updated: Mar 5, 2022

This week’s topic is about purchasing warranties on products and having back up equipment for when it is used for business purposes, hobbies, hosting events and the like.

When you purchase an item there are two common questions . . . should I buy an extended base warranty or protection that covers the entire product?

The answer to that question it depends on many factors such as the type of product, the cost, the quality ratings as well as customer reviews. With that being said, generally speaking, warranties are not worth the money.

Now there is a scenario where a warranty is warranted.

For example, to record this show, we use a Rodecaster Pro podcast studio machine. This is a $600 piece of equipment and it comes with a two-year full coverage warranty. So this was a good choice; right?

Well, this is a yes and no. Recently, I needed to make a claim so I was covered; however, here’s the rub: I have to send the product to the manufacturer which will take 2-3 weeks to fix.

In the meantime, I do not have another mixing board so I was forced to buy another one to keep the show running.

So this is a case where having backup equipment is important and frankly, I got caught on this one.

When I purchased the new Rodecaster, a different retailer offered a two-year full coverage warranty for $180; however, if it breaks I can bring the equipment for a full replacement right on the spot.

So here’s the lesson learned. I should have researched a little deeper because if I paid $180 the first time around, this would have saved me $420 when subtracting the cost of buying a second piece of equipment.

So the irony is that I don’t need to purchase a warranty because I now have two pieces of equipment.

The bottom line is that it is important to have backup plans to make sure that your operation stays on track and putting in the proper research on warranties in the long run save you money.

Episode Link:

When it makes sense to buy a warranty


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