3 Simple Ways to Save Hundreds on Car Insurance

car cash moneyAs cliché as it may sound, there are many steps you can take to save hundreds of dollars on your car insurance. In fact, many people are surprised to learn that this is a simple process. Upon realizing just how much they can save, they look back and wonder why they had been paying so much for so many years.

Are you ready to get started? Here are three things you can do to save big:

1. Increase Your Deductible
This is by far one of the best ways to quickly lower your car insurance premium. Unless you currently have the highest deductible allowed by your insurance company, you are automatically qualified to make this move.

For a better idea of just how much you can save, contact your agent and ask them to provide you with quotes for varying deductible levels. Keep in mind that raising your collision deductible will likely save you more money than simply raising your comprehensive deductible.

2. Search for More Discounts
It is safe to assume that you are presently receiving at least one discount off the cost of your policy. But does this mean that you are getting all of the discounts that you qualify for?

To ensure that you are saving as much as possible, discuss your policy in detail with your agent. Ask them to explain which discounts are currently applied to your account, and from there, request that he or she review your policy for any others that you may qualify for. You may be surprised at how many discounts your agent discovers.

3. Threaten to Switch Insurance Providers
Do you really want to resort to this tactic? Well, it all depends on how badly you want to save money. Your car insurance agent never wants to hear that you are considering switching to another company because their rates are too high.

You should not be rude to your agent – just make sure you are clear that your current premium is too high. You may be surprised at how quickly your agent brainstorm sways to save you money.

If you really want to improve your chance of getting a better deal, present your current company with a quote from a competitor. This way, you can have concrete proof that better rates can be found, and that making a change will allow you to save money.

Final Thoughts
Car insurance is a necessary expense, but this doesn’t mean you can’t find ways to save as much money as possible. If there is any way to save money on your premium, you should strongly consider it. With the help of the tips above, you may be able to save hundreds of dollars immediately.

What other ways can you suggest to save money on car insurance?

How to Negotiate a Medical Bill - 3 Tips for Success

medical bill stethoscopeEven if you have health insurance, there may come a time when you face a hefty medical bill. And for those who do not have any coverage, these bills are all too common.

While it can be disheartening to receive a large bill for medical service, you don’t necessarily have to pay the full amount that is due. It is possible to negotiate a bill from a hospital or doctor’s office – you may not always be successful in attempts to lower the amount due, but it is always worth an attempt.

1. Pay Today, In Person
Unfortunately, unless the billing office is located in your area, you will not be able to pay in person. With many medical facilities, especially larger institutions, it is highly possible that their billing office may be in another city or state. However, if you are dealing with a small local office, such as your primary care physician, there is a good chance that the billing is done onsite.

Don’t be shy about showing up at the billing office and offering to pay on the spot with a credit card or cash. Explain that you showed up in person to pay your bill in full but are only able to afford 80% – you may be surprised at how many times you will receive the discount. A 20% discount is a reasonable request, and a good starting point for negotiating.

Recently, I was faced with a $205 bill for blood work. It was not the largest medical bill I’ve received, but I figured it made sense to at least ask for a discount. After explaining my situation and requesting a 20% discount, the representative countered with a 15% discount if I immediately paid in full. It was an easy decision to make, as I accepted the offer and paid the entire bill at the reduced rate.

2. Be Persistent
There is a good chance that you are going to be declined the first time you request a discount. However, this does not mean you should give up – you simply need to change your negotiation strategy.

If you can afford it, offer to pay with cash. With a cash payment there is no credit card fee or hassle – whatever you agree to pay is what the medical provider will receive, and most companies are hesitant to turn down instant cash flow.

3. Remember to Be Friendly While Explaining Your Situation
It is very frustrating to receive a large medical bill. The couple hundred dollars that I had to pay for blood work is nothing compared to the $10,000-plus bills that some people receive for specialized treatment.

Remember, the billing office employees are only doing their job. They send bills and do their best to collect on them. There is no reason to take out your frustrations on the wrong person; instead, you should be friendly with everybody you speak to.

Furthermore, don’t be afraid to share the details of your situation. Inform them that you are doing everything you can to get the bill paid, such as working with your insurance company (if you have one) or setting aside the necessary amount in your budget to pay the bill in full. If you are friendly and courteous, the person you are working with will likely do what they can to help.

Final Thoughts
If you have top-of-the-line health insurance, you may never have to attempt to negotiate the price of health care. Unfortunately, there are roughly 50 million Americans with no health insurance whatsoever, as well as a large number with low quality healthcare plans.

The next time you are faced with a daunting medical bill, use the three tips above to negotiate a better price on your medical bills. You may be surprised at how much you can save.

Have you ever successfully negotiated a healthcare bill? What tips do you have for lowering the costs of medical bills?

4 Tips to Save $25k+ on your Home Mortgage

mortgage sign papersBuying a home is a dream come true for many people, but the mortgage that goes along with this experience is more like a nightmare. Unless you’re Warren Buffett’s granddaughter, you probably don’t have enough money saved up to pay cash for a home, which means you’ll have to rely on a mortgage that is paid back over the course of many years.

The good news is, there are four ways you can save big on the cost of your mortgage, so you can use your money for other things (like investing in the stock market so you can become as rich as Warren Buffett).

1. Opt for a Shorter Loan.
Fifteen- and 30-year mortgages are among the most common lengths you can get. If financially possible, select the shorter of the two. The reason for this is simple: the quicker you pay off your mortgage the less money you will pay in interest.

Take a $300,000 mortgage, for example. A 30-year mortgage, with an interest rate of 5%, means you’ll pay approximately $279,000 in interest. Keeping the same mortgage ($300,000) and rate (5%) but opting for a 15-year mortgage will result in total interest paid of roughly $127,000. This example illustrates how much you can save by cutting back your mortgage term.

Tip: Ask your mortgage broker or lender to calculate numbers, including a monthly payment, based on several types of loans. They can supply you with accurate numbers, making it easy to see how much you can save by opting for a shorter loan.

2. Make a Lump Sum Payment from Time to Time.
Some people don’t have enough money every month to pay extra on their mortgage. That being said, throughout the year they receive extra money in the form of bonus checks, tax refunds, and other one-time payments. If you have the money, it makes good sense to send an extra lump sum payment to your lender. By doing this once per year it will help you shave several months or years off your term, while also saving you from paying interest.

My plan is simple: I currently have a 30-year mortgage with a fixed interest rate of 5 percent. Every January, I pay an extra $1,000 in addition to my regular mortgage payment. So far, I have done this twice. By continuing to do so, I will effectively reduce the term of my loan by several years and the interest on my loan by thousands of dollars.

Tip: Like many of you, I don’t come into an extra $1,000 every January. Instead, I slowly save this money throughout the year; $50 to $100 at a time. By the time January comes around, I have approximately $1,000 extra. Is it tempting to use this money for something else? Sure. But knowing that it will save me much more in the long run keeps me on track.

3. Make Payments More Frequently.
As you know, your lender will send you a statement once per month. This is the amount you are required to pay. But what if you decide to pay bi-weekly instead of monthly? By doing this, you are in position to shave several years off your mortgage. For those who have a bi-weekly pay schedule this is easy to do from a financial perspective. If you want to know just how much money you can save by making bi-weekly payments, enter your information into this bi-weekly mortgage calculator.

The reason that bi-weekly payments make sense is based on one key fact: there are 52 weeks in a year. For this reason, you end up making 26 payments, which equates to 13 full payments. If you were to make one payment per month, though, you would only make 12 full payments over the course of the year. In short, when you pay bi-weekly, you end up making two extra payments each year, which is the same as one additional “full payment.”

Tip: While getting on a schedule will help ensure results, you don’t have to stick with “more frequent” payments if you find that it is unaffordable. In short, it is your mortgage and as long as you pay the monthly minimum your lender will be happy.

4. Refinance.
What rate of interest are you currently paying? If it’s high there’s no better time than now to refinance. By securing a lower rate you are doing two things: lowering your monthly payment; and lowering the total amount you will pay in interest over the life of your loan.

The only downside of refinancing is that you will have to pay closing costs on the loan. Make sure you factor this in when deciding if this is truly something that can help you save. The earlier you refinance your mortgage the more sense it makes. If you only have a couple years left on a 30-year mortgage, for example, it is better to finish things off at the current rate. You will pay more in closing costs than you will save.

Tip: You don’t have to refinance with the same lender that is holding your first loan. This is a common myth that has negatively affected many people. When refinancing, you should once again shop around for a lender with low rates, reasonable closing fees, and top notch customer service.
Final Word
The majority of people wait for their mortgage statement to arrive and then pay the exact amount due. While there is nothing wrong with this, there are some “tricks” you can use to shave thousands of dollars and many years off your loan. From opting for a shorter term upfront to refinancing when rates go down, make sure you are always looking for ways to save.

A mortgage is a huge financial commitment. By following these tips, you can benefit from significant savings on the total cost of your loan.

Financial Considerations Before Quitting your Job and Starting a Business

starting a businessSome people dream of the day they can quit their job and start their own business. Unfortunately, many people never consider the financial ramifications. Instead, they think the money will be the same because they have a great business idea. Nothing could be further from the truth.

There are many details to consider before you quit your job and start a business. This may end up being the best move you ever make, but you need to make sure your finances are in order, first.

Below are five things to consider before you jump ship and start your own company:

1. Weigh your current income against the potential with your new venture. Will you eventually be able to earn as much as you did at your past job? Do you have the ability to earn more? While there is nothing wrong with making less money, you need to be prepared for this. Would a lower income support your current lifestyle?

The bottom line is simple: if you are going to start your own business, the potential to earn as much or more than your past gig is a very important factor to consider. If it will likely be less than this, be honest with yourself if that is OK with you and your family.

2. How long will it take to generate income? There is no surefire way to answer this question, but you definitely need an idea of the time line that you are up against. Will you be able to earn the same amount within a couple of months? A couple of years? Obviously, the quicker you generate income (even if only a little), the better off you are going to be.

The best way to answer this question is to research the industry in which you are getting involved, while also having a solid business and marketing plan. Better yet, if you can begin working on your side business while working at your full-time job, you can get a great idea of the business’ potential and even start creating some income before you quit.

3. An emergency fund is of utmost importance. If you have money in the bank, you may feel comfortable working without an income for an extended period of time. As a general rule of thumb, try to have an emergency fund that will cover at least six months of expenses. This will give you the time necessary to get your business off the ground and profitable. Simply put, the more money you have in the bank, the less stressed out you will be.

4. Know how much money you need to start your business. Along with this, make sure you know exactly what you are getting into over the long haul. Some businesses do not require much start-up capital; others call for tens of thousands of dollars or more.

Although it would be nice, the initial cash layout may not be all that you need. There is a good chance that your new business will require a steady flow of cash, month after month. If you are not generating income, you must consider other options such as savings, outside funding, and loans from friends and family (this last one is a risky proposition and should be avoided if possible).

5. Do you have the financial backing of a spouse? This can be a pro or con, depending on your situation. Some people are lucky enough to have a spouse earning enough money to keep the family afloat during the start-up phase. On the other side of things, there are those who bring in all the money for their family. In this case, it is much more difficult to dump a steady salary and hope for the best with a new business. Perhaps even more importantly, if you have a spouse, you need to make sure you have their emotional backing as well. Without their support, it could make for a very stressful experience trying to succeed in your business.

Many of the tips above can also be applied to those who are trying to prepare financially for a job loss or bout of unemployment.

Before you give up on your current job and start your own company, make sure to consider the five financial details above. Have you tried to start your own business? Do you have any additional tips to add to the mix?

(photo credit: Phil Sexton)

5 Tips on How to Start a Side Business while Working Full-Time

start a side businessMany people dream of leaving the “rat race” behind and starting their own business. This sounds like a tall order, but in reality, it is quite possible if you take the proper steps along the way. One of the best ways to reach this goal is to start a side business while you are still working full-time. This minimizes your risk, while giving you hope that you will eventually be able to move full-time over to your business. You will also deal with much less stress because, presumably, you will at least have a solid cash flow from your side business before you ever quit your “real job.”

Several years ago, while working full-time in sales, I decided that I wanted to become a freelance writer. Like most people, I was worried about quitting my job and taking the leap. To play it safe, I began to take jobs on the side until I felt comfortable moving into this full-time.

Along the way, I learned quite a bit. Below are five tips for starting a side business while keeping your full-time job:

1. Be willing to work long hours. There is no denying that you are going to be tired after an 8+ hour day at work. But remember, if you ever want to be in charge and own a business, you have to make sacrifices. For several months, I worked eight hours at my full-time job and then sat at the computer for at least four more. Fortunately, since I enjoy writing so much, the second part of my work day was not nearly as stressful.

2. Don’t let your performance suffer at your full-time position. You owe it to your employer to do your job well, even if you are thinking about leaving in the near future. Along with this, keep one thing in mind: you don’t know for sure that your side business is going to take off. For this reason, you may end up staying at your current job for longer than you thought. Don’t burn any bridges!

3. Get help. Even though this is something I avoided, since I was only starting a freelance writing business, most people will be able to take advantage of this benefit. If you have a partner, make sure to spread the work evenly, which will make it much easier for you to work two jobs. A partner also helps to speed up the startup process, meaning you can quit your full-time job sooner rather than later.

4. Create a business plan before getting started. Just because you are not working at your business full-time does not mean you should bounce around all over the place hoping for the best. If you are going to start a side business, you should be serious about staying on track and sticking with your game plan. A business plan gives you direction from the start on everything from organizational structure to marketing strategies. You can also pinpoint exactly what goals you need to reach before you can quit your job.

You can find sample business plans online at sites such as: Bplans and Small Business Information.

5. Set goals. How much money do you want to be earning by the end of the year? What type of revenue will allow you to feel comfortable leaving your current position? Setting some smaller, near-term goals will help you build up your confidence and momentum. Do you want to leave your full-time job within a couple of months? Within a couple of years? Goals will keep you motivated and moving forward, even when times get tough.

These five tips should help you get well on your way towards achieving the dream of running your own business. Are you currently working on a side business? Have you made the leap to working on your own business full time? I’d love to hear your tips and thoughts on the subject!

(photo credit: Ivan Walsh)