Consumer Reports says there's a real dollars and cents reason for this. Stores make a lot more profit on these than on the actual product you're buying.
Whether you are buying a holiday gift or you need a new appliance you're often urged to buy a service plan. Even online, many sites offer an extended protection plan before you check out.
Tony Giorgianni of Consumer Reports said service plans are almost never worth it.
"Our reader survey shows that products don't break down that much during the service contract period. And even if they do, it doesn't cost that much more to repair them than it does for the contract itself," said Giorgianni.
Extended service plans are expensive. They can boost your costs by 30 percent or more and run into hundreds of dollars.
"If you pay for a repair yourself, there's a better chance that it's going to be done correctly and quicker than if you had it repaired under contract," said Giorgianni.
That's what Allen Peacock found when his dryer broke. He was told he'd have to wait three weeks to have it repaired under the service contract.
"I expected prompt service. And instead was told kind of you're out of luck, fella," said Peacock.
Consumer Reports says better than buying a service plan is paying with a credit card. Many cards automatically extend the manufacturer's warranty up to a year, so check your terms. Calling the manufacturer can pay off, too.
"Just because the manufacturer's warranty has expired doesn't necessarily mean that you're out of luck. If you contact the manufacturer and make a good argument, there's a good chance the company will pay for part, or even all of the repair," said Giorgianni.
Consumer Reports says the one possible exception to the no extended warranty rule is when buying a laptop. If you're going to travel with it a lot, Consumer Reports says you may want to consider an extended warranty that covers accidental damage.
Consumer Reports is published by Consumers Union. Both Consumer Reports and Consumers Union are not-for-profit organizations that accept no advertising. Neither has any commercial relationship with any advertiser or sponsor on this site.
(All Consumer Reports Material Copyright 2011. Consumers Union of U.S. Inc. ALL RIGHTS RESERVED.)