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Financial Planning   -> Save Money   -> Insurance costs

Lower Your Insurance Costs

Shop around for any type of insurance, because prices vary.

You may be able to get group insurance through an organization to which you belong.

Stop smoking to save money on life insurance and/or house insurance.

a.    Life insurance

You will need life insurance if you have dependants.   You have a choice between 2 different kinds of life insurance - whole life insurance and term life insurance.  Whole life insurance is a life insurance policy combined with a savings program.  It is expensive, and not necessarily a good investment.  Term life insurance is just a life insurance policy.  We feel you are better off buying term life insurance and doing the investing yourself.  Once you are financially independent (see Free in 30!), you will no longer need life insurance.  We always purchased term life insurance, and stopped buying it in our late 40's.

b.    House insurance

You can lower your house insurance costs by increasing your deductible.  If you do this you won't be insured for small claims.  However, you don't want to make small claims.  They are not worth all the paperwork and hassle, and your rates may increase or your insurance may be cancelled.  Always read your insurance policy and know what you are and are not covered for - yes, we know it's very tedious to read!

House insurance providers may provide discounts for

bulletmortgage-free home
bulletseniors
bulletsecurity systems
bulletsmoke alarms
bulletnon-smokers
bulletcredit union membership, for an insurance agency associated with the credit union

c.    Car insurance

You can lower your auto insurance costs by increasing your deductible.  You may have to pay the deductible in some circumstances where you are not at fault, such as a hit and run, vandalism, cracked windshield, etc.  If you have a high deductible and lend your vehicle to anyone, you have to let them know ahead of time if you would expect them to pay the deductible if they have an accident.

Once you're retired, you can change your insurance because you will no longer need "to and from work" insurance.  Once you're 65, seniors' discounts are usually available.

Check out all of our ideas for saving money and building wealth!

Tip:  Lower your insurance costs - shop around.

Revised: September 14, 2021

 

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