A full page ad that ran Nov. 14 in USA Today says:

"Dear Shopper,

Despite what the salesperson says, you don't need an Extended Warranty.

Yours, truly, Consumer Reports.

Find out why extended warranties have become big business for retailers and a big waste of money for consumers."

Not pulling any punches in the latest round in a long fight against extended warranties, Consumer Reports is swinging for a knockout again, warning consumers holiday shopping costs needn't be inflated by extended warranties.

"Why You Don't Need An Extended Warranty," is the latest Consumer Reports study, published in it's November issue, documenting the publisher's disdain for warranties that often aren't worth the paper they are written on.

"We have long advised against extended warranties. In fact, we feel so strongly that consumers are being misled about them that we took out a full-page ad in USA Today on Nov. 14 (see below) to warn shoppers," the report says.

The magazine says there are only two exceptions to its rule: when you buy a rear projection microdisplay TV and when you buy an Apple computer. Consumer Reports says that's because repair costs are high on the rear projection TVs and they are three times more likely to need repairs than other TVs. Also Apple computers come with only 90 days of phone tech support and their warranties include extended tech support.

Otherwise the $1.6 billion shoppers are expected to spend on extended warranties this holiday season might as well be spent on air.

"Almost all of it will be money down the drain," Consumer Reports insists.

Retailers offer the warranties because, for them, it's good business. They typically earn a greater percentage of the price than they do for the electronic or appliance it covers.

There are many reasons consumers don't need the warranties for everything from computers to vacuum cleaners.

• Products typically last beyond the extended-warranty period.

• When products fail sooner, they typically do so within the product's warranty period. Consider buying electronics and appliances as gifts as close to the giving date as possible so the recipient begins to use it right away. That's so that if it fails and there's a short warranty period, the product will fail within the warranty period.

• When electronics break and they are out of warranty, the repair often costs about the same as the cost of the warranty.

• For some items, it's cheaper to replace it with a new model than it is to buy a warranty or repair it.

"Instead of buying a warranty, that you're unlikely to use, you'd be better off paying to fix your computer if it breaks," Consumer Reports advises.

Consumer Reports says consumers may be more compelled than ever to buy the warranties because manufacturers' warranty periods are getting shorter for labor, from one year to 90 days. While the parts may be free for longer periods, labor can be expensive.

Extended warranties also use the lure of convenience offering in-home service or instant replacements.

"Overall, products have been reliable enough that we don't think you need an extended warranty," says Consumer Reports, which offers repair rates for more than two dozen, three- to four-year old products.

The independent advocate for quality consumer goods and services says consumers should not just comparison shop by the dollar, but also by manufacturers' warranties to get the longest warranty with the best terms.

Also, buy products with a record of good quality. The independent publisher rates hundreds of goods and services for quality, workmanship and customer service.

For those who can't avoid the hard sell or who chose brands more prone to break, the rater advises:

• Read your credit card's terms and disclosure. The small print could reveal that some credit purchases come with extra, free warranty protection that lengthens the manufacturer's warranty.

• Comparison shop extended warranties. Seek the best terms and the best price.

  'Don't pay more than 20 percent of the purchase price for one. Always try to negotiate a better price," the magazine reports.

• Beware. Beware of warranties that force you to transport or ship large items for repair. Shipping costs could negate any cost savings realized by the warranty. For heavy items such as large TVs or major appliances, the extended warranty should include in-home repair or pickup. Also check for a "lemon" clause that says the product is replaced after several or more repairs.

• Also check your state's consumer protection laws. Some lemon laws and "implied warranty" consumer laws offer added protections that make extended warranties unnecessary.

Published: November 20, 2006

Use of this article without permission is a violation of federal copyright laws.

Broderick Perkins parlayed a career in old-school journalism into a contemporary digital news service that really hits home. The award-winning consumer journalist, originally from Wilmington, DE, is founder, publisher and executive editor of the bootstrap DeadlineNews Group, a Silicon Valley-based editorial content and consulting service specializing in residential real estate, consumer news and related editorial consulting services. The DeadlineNews Group includes the website, DeadlineNews.com, offering real estate editorial content and consulting services, and its back shop, the Deadline Newsroom, an open house on news that really hits home. Perkins obtained his formal journalism education from University of Delaware and a journalism boot camp, the Institute of Journalism Education at the University of California-Berkeley. He went on to 20 years of service as a daily newspaper journalist at the Wilmington, DE News Journal and San Jose, CA Mercury News. Perkins covered housing on the San Jose Mercury News reporting team which earned a General News Reporting Pulitzer Prize in 1989 for coverage of the Loma Prieta earthquake. He has also produced real estate, consumer and small business content for the Wall Street Journal, Los Angeles Times, RealtyTimes.com, Nolo.com, Better Homes and Gardens, the National Association of Realtors, Homestore/Move and Intuit/Quicken among more than three dozen publications. In addition to managing the DeadlineNews Group, Perkins most recently served as chief editorial consultant for Nolo's Essential Guide To Buying Your First Home, Nolo, and writes real estate television scripts for RealtyTimes.com.