When shopping for electronics and big-ticket items such as cameras, TVs and other appliances, we are often faced with strong and seemingly sensible encouragement from the salesman to take out an extended warranty on the product. After all, you’re paying a lot for this advanced technological gadget - don’t you want to protect your investment?

According to Consumer Reports extended warranties are not only not necessary, they are probably money wasted. Most of the products they have tracked have not needed major repairs in the two years since they were purchased and often the cost of the extended warranty is more than paying for a repair, if one is ever needed.

Retailers advise you to take the warranties because they get a large percentage of the price of the warranty. In fact, they make more money on extended warranties than they do on the products they are selling the warranties on.

According to Consumer Reports:

For the consumer, extended warranties are notoriously bad deals because:

* Products seldom break within the extended-warranty window (typically around three years), our data show.

* When electronics and appliances do break, the repair often costs about the same as the cost of the warranty.

Read the rest of the article at Consumer Reports

We may hate that word discipline when it’s applied to ourselves, but it is the single most important factor in deciding whether we are rich or poor. Without self discipline, we will spend lavishly on the whims of the moment and end up with a mountain of trash and no money.

So how to become disciplined where money is concerned? Gary Simpson of Personal Finance Budgeting suggests taking out a large denomination bill from your bank account, say $100, putting it in your wallet and then never spending it! To know that it’s there gives one a good feeling - and having the determination never to use it for purchases builds self discipline.

It’s a good system and I can see that it would work. That is, if you actually have $100 in your account, of course…

Everyone starts somewhere, I guess. Have a read of the article - it’s full of good sense.

With the Christmas shopping season nearly upon us, we will be out and about, scrambling to buy gifts for loved ones. According to Amar Cheema, assistant professor of marketing at the Olin School of Business, Washington University in St. Louis, it’s also the season when people are mostly likely to buy self-indulgent gifts for themselves.

Christmas sales, rebate offers and easy credit (sometimes with no money down and 0% interest for a specified term) all give the shopper incentives to buy that big ticket item he or she has been longing for. But only 40% of consumers actually send in those rebate forms and easy credit can encourage consumers to spend more than they can afford.

But according to Cheema, these discounts are not as money-saving as they seem and you are often better off waiting until the post-holiday sales when retailers cut prices to reduce inventories to buy yourself that large-screen plasma TV.

Read the article at NEWSWISE

CNN has an article looking at Consumer Reports’ latest survey on reliability in 2006 and 2007 cars. It makes interesting reading, with some winners you would expect and some surprising losers.

Toyota and Lexus do well but I was amazed that Volkswagen have so many models that owners reported as unreliable. As a result, I wonder just how reliable these surveys are. How were they conducted and what questions were asked? And to what extent has the usual problem with these surveys been overcome - that many owners hesitate to pour scorn on what was their own choice, after all?

These questions are answered in Consumer Reports’ FAQ on the matter. It does seem that they make a good job of their investigations and so we would be wise to take note of their findings when looking for a new car.

Have a read and be prepared for some surprises.