One of the ways my wife Kim and I paid down our $52,000 in debt so quickly was that we analyzed every expense we had to see how we could reduce or eliminate the expense, giving us more extra cash to put toward paying down our debt.
Even on seemingly concrete expenses such as car insurance, we found ways to save money and spend less. Here are five things you can do to save money on car insurance to have more cash toward your financial goals.
Increase Your Deductible
Most insurance companies have a standard deductible of around $1,000. But did you know that you can increase your deductible to $2,500 and get a lower insurance rate?
This could save you a lot of money over the long term, but it’s important to remember to have an emergency fund that covers the $2,500 and more if you’re going to go with a higher deductible insurance plan so that you’ve got the money available to cover the cost if needed. Check out this post on how to grow your savings account to help you save money fast.
Do Some Comparison Shopping
Not all insurance companies are created the same. Each company has different criteria for deciding what your insurance rate will be. This is why it’s important to shop around. Companies such as Esurance will help save you time by giving you the insurance rates of dozens of insurance companies in your area by making just one phone call so that you can quickly find the insurance company that gives you the best value for your dollar.
Ask About “Low Risk Occupation”
Some insurance companies charge lower rates for what they deem “low-risk occupations.” The theory behind this is that people employed in low-risk occupations take lower risks in general and are likely safer drivers, qualifying them for a potentially lower insurance rate. Some examples of low-risk occupations include accountants, engineers, and teachers. Make sure to ask specifically about this type of discount, as not all insurance companies offer it.
Etch Your VIN Number
Studies show that cars that have their VIN number etched in all of their windows are less likely to be stolen, so some insurance companies offer a discount for this feature. If your insurance company does offer this feature, you could save up to 15% on your annual insurance rates, which more than makes up for the twenty bucks or so it costs to have your windows etched. As with the low-risk occupation discount, though, you’ll probably have to be the one to bring it up, as it’s not a standard discount for all insurance companies.
Combine Your Policies
Many insurance companies offer substantial discounts when you purchase more than one policy with them. As you shop around for insurance rates, check on companies’ other rates for insurance you might need, such as homeowners’ insurance, rental insurance, or life insurance. If an insurance company knows you’ll be purchasing more than one type of policy with them, they’ll likely offer a measurable discount.
It’s common to think that necessary expenses such as car insurance aren’t negotiable, but I found that you can reduce almost any expense simply by calling and asking. More money in your pocket means more cash toward reaching your financial goals.
What suggestions do you have for saving money on car insurance?
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