Let’s face it: We often waste money on stuff we don’t really need. But there’s a big difference between splurging and wasting money on purchases and services that, while marketed as useful, are bad buys. At Washington Consumers’ Checkbook, they’re often warning about products, services and extras that aren’t worth shelling out money for, such as air-duct cleaning and lousy insurance plans. Below is a list of such home-related expenses, drawing from our advice on “65 Things You (Probably) Shouldn’t Pay For.” Keep in mind that we always find that the biggest money waster is failing to shop around; our undercover price shoppers routinely find cost differences in the thousands for the same projects.
Air-duct cleaning. We call duct cleaning a solution in search of a problem. Companies that do it claim that their services will improve your home’s air quality, but there’s little evidence of substantial benefits. Even if you have dust allergies, you may want to avoid having your ducts cleaned. The little independent research on duct cleaning indicates that stirring up the dust in your ducts may temporarily worsen dust levels.
Basement waterproofing contractors. If you have a wet basement, before calling in a waterproofing contractor, try some simple solutions. Most moisture problems are resolved by cleaning out clogged gutters, extending gutter downspouts or regrading to improve drainage outside. These tasks are far less expensive (even if you hire someone to do them) than jackhammering your basement and installing interior drainage systems and sump pumps. Waterproofing companies will gladly sell you costly solutions that manage rainwater after it enters your home, but they usually won’t offer to solve the problem outside — at the source.
Extended product warranties. Purchase protection. Service contracts. AppleCare. Whatever retailers call them, these policies are sources of easy revenue for the outfits that hawk them and for the insurance companies that administer them and honor infrequent claims. But we find they are usually bad deals for consumers. Even if you want an extended warranty, you can usually get it for no cost. Many credit cards companies, as well as Costco and Sam’s Club, automatically provide free extended warranties. That so many companies give away extended warranties is a clear sign that they’re not worth paying for.
Many companies advertise ‘green’ pest control. But is it possible? And does it work?
Exterminators. If you have a pest problem, learn what you can do yourself before you hire an exterminator. Unless termites or bedbugs are the problem, homeowners can solve most creepy-crawly invasions. If you do hire help, start with a reputable service and avoid long-term contracts. A single treatment performed properly will rid you of most household vermin. Suspect termites or bedbugs? Get several inspections and proposals.
Furniture and carpet protection plans. In the past, stores offered to apply a stain-resistant coating. Now those coatings are applied during the manufacturing process. What the stores offer is lousy insurance coverage. Don’t buy it.
Home security systems. Because most burglars enter homes by opening unlocked doors or windows — or pushing and kicking locked ones until they open — shoring up your home’s vulnerable points is more effective (and much cheaper) than getting an alarm system. Secure all doors with good deadbolt locks, lock all windows that are accessible from the outside, set up lighting systems that deter burglars and improve your own safety habits.
Homeowners are increasingly setting up their own simple security devices to save money on equipment and avoid costly monthly monitoring fees.
Home warranties. Home warranty companies run numerous ads promising to save you thousands when something goes wrong with your refrigerator, furnace, plumbing, and other appliances and systems. But don’t count on the peace of mind these plans promise. We find these warranties are terrible deals for most homeowners.
Warranty companies are the subject of many complaints to consumer agencies. Even after paying $400 to $1,000 for coverage, consumers will find that home warranty contracts are typically filled with fine-print exclusions that stick them with much of the costs for product repairs or replacements. The majority of plan buyers will pay far more in premiums and service fees than they’ll get back for covered repairs. You also don’t get to decide who does the work. We find that the best repair services overwhelmingly disdain these plans and won’t work for home warranty companies.
Homeowners insurance gotchas. It is important to obtain an accurate estimate of your home’s replacement cost to determine how much dwelling insurance you need. The replacement value isn’t the same as the market value; the latter includes the value of the land and your home’s foundation, which are two expensive components that don’t need to be insured against wind, fire and more. The replacement value is an estimate of what it would cost to rebuild your house completely on the land you own. Although many U.S. homes are underinsured, some are overinsured, because disreputable agents tell their clients to buy dwelling coverage equal to a home’s market value.
Another big source of insurance-spending waste? Sticking with the same insurance company year after year instead of periodically shopping around for better rates. We find that most homeowners will save more than $500 each year by switching to a lower-priced company; some will save $1,000 or more.
Eight tips for buying homeowners insurance…
HVAC maintenance contracts. Some heating and air-conditioning companies swear by these contracts, arguing that regular maintenance helps avoid breakdowns during times of peak usage. But many really push these plans to keep their technicians busy during otherwise slow months — and to maintain a steady flow of revenue.
To start, identify a reputable HVAC contractor and ask how often your equipment needs service. (Checkbook’s ratings will help you narrow your search.) If you need professional maintenance visits every year — if, for instance, you have a large house or are unable to change filters yourself — a maintenance contract might make sense. But most equipment doesn’t need twice-a-year maintenance, and we get a lot of complaints from consumers with service contracts who find that technicians discover something to repair on every service visit — at an extra cost.
Interior designs. The cost of hiring a fully trained designer to redo a living room is typically more than $20,000. Although many overwhelmed consumers are happy to spend what it takes for help with their furniture purchases, there are cheaper options.
Store-based designers sometimes offer limited services, but others do more, such as drawing floor plans and advising on color selections. Design services at many furniture stores are free; at others, you pay a small fee, refundable if furniture purchases exceed a certain amount. At some stores, designers charge hourly rates or flat fees for consultations.
Junk haulers. There are many free ways to get rid of unwanted belongings, including donations to charities, some of which will even pick up. Online networks such as Freecycle and the Buy Nothing Project match you with people who think your trash is treasure. If you need to unload an entire household’s worth of stuff, try working with an estate sale company.
Picture framing. You can tackle most framing jobs on your own. If you have standard-size pieces, you can buy inexpensive, premade frames. If you have odd-size art or want customized frames and mats, several websites allow you to enter measurements and choose from various frames. The store ships your products, and you assemble them. In our experience, this is a relatively simple (but not totally goof-proof) task.
Self-storage rentals. For proof that we Americans have too much stuff, we present the burgeoning self-storage industry, which rakes in approximately $40 billion a year. Unless you’re in between homes or need a place to stash your items during renovations, try downsizing rather than blowing big-time money on storage. If you do need storage, shop around to ensure you don’t overspend. Our undercover shoppers found big prices differences among local spots.