I Was 10 Seconds Away From Getting Screwed by Best Buy

I once heard someone say there is never a great day to have a flat tire. So very true. But you can add this to the list, there is never a good day to have you eleven-year-old refrigerator crap the bed.

Yes, our refrigerator greeted Tuesday by deciding that’s the day it would expire. It did the digital death. On and then just plain off for good. No cooling for you.

Most of the food in the old GE fridge had to be trashed, and that was a big expense. Irritating.

Getting the old fridge serviced was going to take days and wind up being a sizeable investment even without the cost of the new compressor.

About five years ago the ice maker had checked out and the repair company wanted about $700 to replace that. Nope. We’ve lived with buying bagged ice since then.

The repair company said we could buy an extended warranty that would cover all our appliances for ONLY $49 per month with an initial payment of $99. The service representative said if we waited to purchase the warranty until the service technician came out it would only cover 50% of the costs of parts and service.

That warranty offered sure seemed like a high-pressure sales approach and the “you must decide now” was the instant hell no from me.

So when the old GE packed it in, considering the cost of service and fixing the thing it made more sense to get a replacement.

I wasn’t expecting how frustrating it is to buy a refrigerator. Before making a big purchase I typically do some prudent research to know what I’m shopping for. I went to Consumer Reports to see what their independent tests found on refrigerators. There were some clear winners. But what I discovered was none of those highly recommended refrigerators were either available in my area or could arrive in a couple of weeks.

I had to lower my standards a bit and start shopping for what was available in a couple of days and then see what was a well-reviewed unit.

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We found a neat refrigerator at Best Buy and they will deliver the new unit, haul the old one away, and screw on the ice maker line for nearly free. It’s mostly built into the sales price. Nothing is ever really free.

But Here is the Gotcha

Our very nice salesperson was suggesting the Best Buy extended warranty on the new refrigerator. “For only $330 you will get three years of protection,” he said. A little questioning discovered the first year of the warranty was actually the manufacturer’s warranty. The one we picked is made by LG.

“LG only gives you a one-year warranty so you should think about the Best Buy warranty,” the nice sales dude said.

Thinking about the offer for ten seconds I decided to pass as everyone stared at me to reach for the brass ring and just do it.

Some additional research after I got home discovered an interesting little fact. It turns out the LG warranty is actually one year for internal functional parts like drawers and shelves and five-years parts and labor for the expensive sealed system parts. The compressor is covered by LG for ten years. For No Additional Cost.

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I also looked to see what additional protection my credit card offered and it only added an additional year on warranties that are three years or less. So right there I had already extended my internal warranty to two-years for no additional cost.

So the Best Buy statement the refrigerator was only covered for one year was just misleading.

The Takeaway Lesson

If you have to make a big purchase and feel like you are being pressured to make an expensive decision, don’t do it. Walk away, do some research, and make an educated and informed decision instead.

In the case of the appliance warranty packages, there are a number of companies you can find with a quick search where you can purchase packages that cover all of your appliances for less than what you may be pressured to purchase at the moment.

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But keep in mind that warranty packages are designed to cost the company less than what you pay. That’s how they make a profit. If you just self-insured and saved the $49 a month, for example, into your own appliance savings account you stand a better than average chance of coming out ahead.

In my case, 11-years of $49 a month warranty payments would have cost $6,500 and if I saved that money into a special account I could have used that money to buy a whole new crop of replacement appliances. The fridge is the only appliance we’ve purchased in the last decade that went bottoms up.

It’s just too bad you don’t know the exact day your refrigerator is going to pack it in so you can shop and plan far in advance for the best replacement. But you can shop wisely when you have to and make some good financial choices.

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Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.
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