My son bought a CD player, but when it came time to pay, the salesman was urging him to buy a service contract. My son didn't have enough money to buy one, so I did. My son didn't have enough money to buy one, so I did. Service contracts are a waste of money unless you plan to use a product heavily. Service contracts typically cost four to seven times the estimated total repair costs predicted for the life span of most appliances.
Retailers push the contracts because they are enormously profitable.
Neale S. Godfrey, former bank president, is an acknowledged expert on family finance. The Today Show,'' and CNNfn. Photo by Jeanne Strongin. All text by Neale S. Godfrey. Children's Financial Network Inc. All rights reserved.