Many retailers now offer extended service plans or warranties for an additional cost, covering you in the event that your laptop or phone or major appliances goes kaput sooner or later. But is it worth the extra cost? Statistically, the answer is probably “no” for most items.

“From a purely economic standpoint,” says Rajiv Sinha, marketing professor at Arizona State University, “It usually doesn’t make sense to buy an extended warranty.”

But there are times and circumstances where you may feel better protecting your big purchases. So today we’ll share 30 tips, facts, and pointers on the cost of that additional service plan:

1.     Selling extended and third party warranties is big business, especially for certain products, including electronics and appliances.

2.     In fact, there’s plenty of incentive for retailers to nudge you into paying more for an extra warranty. It’s a cash cow for retailers, who keep up to 50 percent or more of the cost of the warranty. To put it in perspective, that often adds up to more than they make on the sale of the actual item.

3.     So it’s no wonder that a reported 88 percent of in-store purchases included a pitch to buy the service plan, including 74 percent of all electronics purchases.

4.     And about 16 percent of consumers do opt to pay for that additional service plan. Interestingly enough, it’s not always the sellers’ sales pitch that leads us to buy these extended service plans, as evidenced by the fact that 12 percent of online shoppers still opt to buy it, only a slight bump from in-store rates.

5.     That confirms what industry experts – and companies – know about our decision making process: we don’t make rational, calculated decisions, but emotional ones. More specifically, regret avoidance is the strongest motivator. People literally envision the product breaking down the road and how they’ll feel if they don’t buy the plan, pencil out the cost benefit.

6.     And we often overestimate the possibility of products failing, because it causes a much higher negative emotional charge when that does happen.

7.     That’s why extended service plans are always sold at the register at the time of sale (same as opening a store credit card for a discount) – forcing you into an impulsive, quick decision.

8.     Refrigerators are one item where 40 percent of consumers take out service plans, but it rarely pays off.

9.     In fact, for expensive consumer products like fridges, ranges, washing machines, big televisions, stereos, etc., they rarely break down (considered 15 percent or less) after the included manufacturer’s warranty but within the extended warranty you have to pay for.

10. How much do service plans and extended warranties cost? Of course they vary greatly depending on the product and cost, but overall, the median price for big electronics and appliances was $123, or $37 for smaller items.

11. According to consumer analysts, the average warranty or service plan is 10-20 percent of the original sales price. But if it does exceed 20 percent, it’s almost never worth it.

12. Retailers and marketers also know that consumers are more likely to pay extra for a purchase they love and enjoy often, like a cell phone, tablet, or TV, than something mundane like a washer or dryer. So you better believe that warranties cost more on those items!

13. For instance, only 2-4 percent of TVs ever need repairs.

14. The average term for extended service plans is three years after purchase. But remember that the original warranty usually covers the first year against defects.

15. It’s also cheaper than we anticipate to repair appliances and electronics. When it comes to the repair price versus the cost of the warranty or service plan, there’s only a median difference of $16, according to surveys.

16. If you do buy the extended warranty, you’re probably being redundant. Remember that most stores have their own 30-day warranty and return window, and then the manufacturer’s warranty kicks in for up to a year.

17. Pay with a credit card, because many of the good ones offer an additional warranty or even extended the manufacturer’s warranty. But beware if you’re paying with a gift card or cash, because that could actually void the built-in service plan!

18. Ask if the warranty be transferred if you sell the item or gift it.

19. For portable electronics like phones, laptops, and tablets, drops and spills are the two most common reasons for damage, so make sure they fully cover those instances.

20. Check if there’s a deductible for repairs before their warranty kicks in. If there is, it almost never makes financial sense to opt for it.

21. Remember that most service plans won’t cover theft, including Apple’s protection plan, as iPhones and tablets are one of the most commonly stolen items.

22. Be sure to read the fine print, as companies look for every loophole so they don’t have to pay up to repair or replace your item. For instance, if you’ve made any alterations, not done proper maintenance or cleaning, etc. then the warranty may be void.

23. Satisfaction surveys for consumers who took out and used service plans reveal that only 62 percent of those surveyed were highly satisfied with repairs.

24. There are two specific purchases where paying for the extended warranty actually might pay off: used cars (but be careful where you get it from because the industry is riddled with complaints), and home warranties, especially on older homes.

25. There are plenty of companies that offer after-market or third-party service plans as well, like ProtectCELL that covers tablets and phones, even in event of theft, and SquareTrade, which covers televisions and electronics. The nice thing about these companies is that you can purchase their coverage any time you want, not just at the point and time of purchase.

26. If an item breaks but is out of warranty or not covered, you can still contact the manufacturer and request that they help you. Try to appeal to the office of an executive or customer service manager, who has the power to make an exception.

27. Remember that your homeowner’s insurance or renter’s insurance may cover you if some appliances break down so check your policy, though you may have to register them ahead of time.

28. Some consumer watchdog groups recommend you take the price of the service plan and just hold onto it in a separate account or in savings in case something does break. So if you have 10 appliances around the house with $500 total in that account but only one thing breaks, you’ll probably be able to replace or repair it no problem, without having to bet when and which one will be problematic.

29. Or, it’s a safe bet to take the money you would use on a warranty and instead use it to upgrade to a better brand or more reliable model.

30. For detailed information on failure rates for specific items and brands, check out Consumer Reports magazine annual rankings.