I've written a lot of personal finance blogs overs the years that I have been doing this. I often recommend different strategies for financial gain, and most of the time these are practices that I live by. Sometimes I can only speak about things theoretically as they rely on specific circumstances to test. When these things do come up, however, I am often reassured that the financial theories I have been putting into place are succeeding. Here's one example of how I've put my money where my mouth is – and came out on top.
While I haven't specifically written about it myself, Canadian Finance blog has repeatedly advised consumers to avoid the extended warranty option when purchasing a large electronic device. So this last Christmas when I purchased a large screen Plasma TV, I opted not to purchase the extended warranty. There were two main reasons why I chose not to invest in the extended warranty. First, I didn't think that my TV would break. Consumer Reports recommends passing on the extended warranty because of the often limited window of coverage and the relatively low chance that your device will break during that window. They also report that Plasma TVs (the type of TV that I purchased) has a less than 3% chance of breaking during the first 3 years, and most of those that did broke during the manufacture's warranty.
The second reason I didn't purchase it was because I felt covered by the additional protection purchasing using my credit card provided. Using my credit card will double the manufacturer warranty on most products, so even if my TV did break I would be covered for the first two years. The extended warranty, at that point, just didn't see worth it. And besides, what are the chances my TV would be one that broke?
Using the Warranty
Well my TV did break. I turned it on one day, started watching TV, and then my TV shut itself off, never to turn back on. I called Samsung, and I was transferred around a few times, before being told that they could do nothing without the receipt to confirm the date and time that my TV broke. I knew it was still under warranty as I had purchased it on Boxing Day last year, so almost exactly 11 months ago. However, as I'm in the middle of moving, I could not find the receipt. No problem, I headed back to the location where my TV was purchased and got another copy of the receipt. Easy!
That being settled, I contacted Samsung again, and without a few hours they had someone at my home taking my TV apart. Luckily they had in stock the piece that had broken so they swapped it out and billed Samsung for the hassle. As the TV was still under warranty, I only had to spend a few days without my TV working before it got back up and running without having to spend a dime, and all without the Extended Warranty!
The real hassle, I'm sure, will be if it breaks again outside the manufacture's warranty and I have to go through my credit card provider to get service covered, but that will have to be another blog post for another day – that hopefully never comes.
When has practicing personal finance advice benefitted you?