Extended Warranties - Are they worth it?

Bumpyroad wrote:

edbehnke wrote:
simple answer in my opinion is no.

if you really want to protect yourself put $3000 in a separate bank acct. for your trailer.

If one has an extra $3,000 to put in a special account that might work. but I would assume the RV and warranty would be financed and the warranty wouldn't add that much to the monthly payment.
bumpy

That is where people throw away money. The monthly payment is not the concern but whether it makes sense to pay for an extra and hope that it will save money in the long run. Extended warranties are the single most profitable item that dealers and stores can sell to customers. Nothing else even comes close. They can get more dollars of profit from the extended warranty than they made on the sale of the product it covers.

With a used RV the most likely items to fail are the air conditioner and the fridge. Figure $1200 to replace one should it fail and compare that against the cost of the warranty and its duration. It is is a 5 year warranty and the fridge is 5 years old in the RV then it may be a good decision to buy the extended warranty. If the fridge is 3 years old and the warranty is extended by 3 years, then it is not nearly as likely to be a good use of ones money.

Only twice have I benefited from the purchase of an extended warranty and both items where products that I knew had reliability problems, one being an expensive inkjet printer where head replacements were common and expensive, and a DLP television where replacement lamps cost $400 and the special color wheels another $200 and the primary control boards cost $700 - so paying $300 for the extended warranty was an easy decision to make.