How to get cheaper house insurance

Part 2 of the "How to get cheap insurance"!

Homeowner insurance premium is based on the quality of construction of your house, location, and amount of security. You can't do much about the first 2 things, except move to an other house, which isn't practical.

Anyway, here are a few tips on lowering your home insurance premium:

1. Think about increasing your deductible. If your current deductible is low and you would be able to spend more than that if you where to make a claim unexpectedly then lowering the deductible amount is the first go-to way to reduce your premium.
2. Compare your current coverage with other competitors. Not all plans are equal, some might be better suited for you, so review the policies of other competitors when the time comes to renew your coverage.
3. Potential deals and discounts. 
• Some insurers will offer you a discount if you insure both your auto and home insurance from them. 
• Some insurers might offer senior discounts for people as young as 50 years old. 
• Like auto insurances, see if you can get insurance via your company to get a group discount.
• Consider security equipment, simple things such as smoke and carbon monoxide detectors will usually get you a discount. Other equipment would be burglar alarms, dead-bolt locks or even sprinkler systems. Make sure to check with your insurer prior to purchasing these though to make sure the devices qualify for a discount.
4. Do the inventory of your belonging and approximate a replacement cost. Your rate is also based on the contents of the house, if you've recently gotten rid of stuff or replaced appliances, notify your insurance company with your new replacement cost.
5. Try to avoid claiming for minor stuff. This will potentially increase your rate.
6. Stop smoking. Smoking increases the rate on all your insurances, since it's a health & life hazard, and smoking is potentially dangerous for your house & car.

Hopefully some of these tips will help you lower your home insurance premium.

Take my money,

Phil.

How to get cheaper car insurance

You're probably paying too much for your insurance, there are a few ways to lower your premium you pay without lowering the coverage and quality you get from your insurance company.

So, without further ado, here are a few tips:

1. Install an anti-theft device on your car. Most cars have one built in, but if you don't, you're paying extra. Depending on the terms, you might get a cheaper rate if you use a steering wheel lock.
2. Install a "Usage Based Auto Insurance Device". This device is installed in your car and tracks your driving information and sends it to your insurance company so they can adjust your rates depending on how well you drive.
3. Multiple car discount. If you own two cars, have them insured together, your rate won't be as high as it would be if you where insuring both cars separately. Make sure to ask for this discount when you are discussing your insurances with your agent.
4. Get a long term policy. Getting the longer policy will freeze your rate for the length of the policy, versus taking a shorter policy which is subject to price changes more often.
5. Keep track of your mileage. When your insurance company asks you how many miles you drive to work per day, make sure to give them an exact number (or in any case, not any higher), so they can place you in the right price bracket. If you're close to a mile bracket, this goes doubly.
6. Group discount. If you're affiliated with an organization, you can probably get a discount from your insurance company. Call your insurance provider and ask them a list of organization affiliations.
7. Check out the Storage Coverage. If you're planning on leaving your car stored, it is cheaper to just keep the comprehensive coverage, since you won't be getting in any kind of collision accident.
8. Do direct payments instead of mail payments. You will usually get charged a fee for doing mail payments. Have your payments automatically deduced from your credit card.

Of course all these tips might not apply to you, or your insurance company might not offer rebates for some of these points, but it's worth contacting them and seeing what you can do to lower your rates. In most cases, there is always you can do to lower your auto insurance rates down to affordable auto insurance rates. If it still doesn't work out, call an other company and ask for an auto insurance quote that would meet your requirements.

Take my money,

Phil

4 Ways to Lower Your Monthly Mortgage Payment

Are you being overwhelmed by your home mortgage bill? Want to lower the monthly payments? Here are a few ways you can do that.

Refinance Your Mortgage

Should you refinance? The answer depends on the age of your loan and the difference between your current and potential new interest rate.
Home loans amortize, which means you pay mostly interest towards the beginning of the loan term and mostly principal towards the end of the term. As a result, interest rate is most important towards the start of a term. The interest rate makes less of an impact towards the end of the term, when your payments are predominantly principal.
Translation: the newer the mortgage, the stronger the argument that you should consider refinancing.
But refinancing turns the amortization clock back to square one, and also gobbles a few thousand in closing costs, so a small difference between your old and new interest rates -- say, 0.25 percent -- might not be justified. Run a spreadsheet to see if refinancing is right for you if the interest rate spread is 0.5 -- 1 percent or higher.

Drop Your PMI

Are you paying private mortgage insurance, or PMI? If you bought your home with a down payment that's less than 20 percent, you might be paying PMI, which is adding hundreds or thousands to your mortgage each year.
There's good news, though: you won't be stuck paying PMI forever. First, repay enough of the mortgage that you've gained 20 percent equity in the house. (You can also gain equity faster if your home value rises -- but, of course, you have no control over that).
Then contact your lender to inquire about the process of dropping your PMI. Lenders won't drop the PMI automatically -- you'll have to request it. Many lenders will send an appraiser to determine the home value before the lender verifies that you own a 20 percent equity stake.

Get a Longer Loan

Suffering under the hefty monthly payments that come with 15-year or 20-year mortgages? Extend your mortgage into a conventional 30-year term in order to cut your monthly payment. The bad news: your interest rate will rise. The good news: you can still choose to make additional payments on the mortgage, as if you were paying a 15-to-20-year loan. These extra payments will help you satisfy the loan more quickly, without obligating you to make massive payments if, say, there's an emergency that leaves you cash-shy for a month or two.

Challenge the Tax Assessment

Here's an uncommon way to lower your monthly home payment: fight the tax assessment.
A conventional mortgage payment consists of your principal payment, your interest payment, and your "impounds," which is a monthly payment that the lender puts towards your property taxes and homeowners insurance.
If you default on your property tax bill, the county can put a lien on your house. The governments lien will take priority over the lenders lien.
As a result, the lender collects your property taxes each month in order to protect its interest in your home. This payment sits in escrow until the yearly property tax bill is due.
Property tax is based on the county's tax assessment of how much your home and land is worth.
Many of these assessments are too high, especially in the wake of the housing crash, which diminished home values. Sometimes assessments are also too high if the area has been re-zoned, the new zoning has caused home prices to decline, and the declined prices aren't reflected in the assessment.
Homeowners can protest the assessment by filing a protest with the county or requesting a hearing with the state Board of Equalization. If the protest is approved, the homeowner's taxes drop, which means that their monthly mortgage payment also drops.
(Note: an "assessment" is different from an "appraisal." The county does an assessment for tax purposes. A private company does an appraisal, generally for loan and purchasing purposes.)

Source : budgeting[dot]about[dot]com

Are You Ready to Buy a Home?

Owning a home is a usual goal for many Americans. A home provides a feeling of stability and community. You can develop relationships with your neighbors and establish roots in your community.You can customize and shape that home to your liking; add a room or knock down a wall; the choice is yours. People like owning things and this includes homes.

However, homeowners in many parts of the country have watched the values of their property decrease in recent years. While this isn’t good news for sellers, it does offer an exceptional buying opportunity for many people. Real estate is cyclical; values fall and values increase, but historically real estate has proven to be a good investment. It’s difficult to predict when the absolute bottom of the market will be reached in any particular area, and savvy investors may want to act now to take advantage of the low mortgage interest rates.

If you need a mortgage loan to purchase a home, the first thing you should do is to talk with a mortgage broker or banker. You can start with the bank where you have your checking or savings account. Call the local office and make an appointment to speak to a loan officer. Bring the last two years of your tax returns with you to the meeting. Loans are difficult to obtain and a loan officer can look at your credit report and discuss various options that are available to you. There’s no charge for the meeting.
A bunch of numbers on a lender's schedule do not really indicate whether or not you can afford a house, because they say nothing about how you manage your money. Before you start looking at houses or talking to real estate agents, follow these steps to see if you're ready to buy a house.
The most common requirements for a residential, owner-occupied mortgage loan are two years of steady work, no recent foreclosures or bankruptcies, a minimum credit score of 640, U.S. citizenship or resident alien status and monthly debts – credit cards, auto leases, alimony, child support, projected housing expenses -- shouldn’t be more than 36 percent of your gross monthly income. This is also known as your debt to income ratio.

If you fail to qualify for the mortgage, the loan officer might be able to help you improve your situation. Low credit scores can be improved by paying off some debts and lowering the amount you owe on the credit cards; you can also ask for a higher credit limit on an existing card. If you don’t have two years of continuous employment, plan on delaying the purchase until you meet that milestone. If your income is insufficient to qualify, you might be able to add a co-borrower who has sufficient income and a good credit score to the mortgage. The loan officer will explain the details to you. Lastly, don't forget about the closing costs involved in buying a home. They can add up to thousands.

However, even if you qualify for a home loan, are you really prepared for ownership? When the house needs repairs, there’s no landlord or property management company you can call; maintenance is your responsibility. Property tax and homeowner’s insurance costs may periodically increase and a high insurance deductible means that you’ll pay out-of-pocket for many repairs.

Do you have a stable job? If you lose it, do you have enough of a cushion saved that allows you to continue to make the mortgage payments until you find new employment? Many families live paycheck-to-paycheck and accumulate little in savings. While this may be an acceptable situation for a tenant, a homeowner can be faced with many unexpected costs.

Look at your lifestyle and financial health and determine if home ownership is right for you. If you do decide to move forward, be sure not to make a major credit card purchase until after the closing. The increased debt may kill the deal. Otherwise, have fun looking at homes and choose your advisors wisely.

Source : financialplan[dot]about[dot]com

Financing Your Child's Education

As a parent of a child, you have probably had thoughts about them attending college and how they will pay for it. At the same time you’ve probably also thought that you can procrastinate that since they have a couple of years to go before college. Unfortunately, this is usually not true for most households. Especially since even a modest undergraduate college degree could cost over $100,000.

Estimate How Much You’ll Need

Taking the first step in saving for college is always the hardest. You’ll be asking yourself how much you should save and where you should put the money. Once those questions have been answered it becomes much easier to start making those deposits.
First, you need to estimate how much that education will cost. To give you an idea, for the 2009-2010 school year, the average annual price for tuition, room, and board at public universities was over $12,000. At private universities this number jumped to over $32,000. So, a four year degree today will cost anywhere from around $50,000 to well over $100,000.
Keep in mind that these are today’s prices. If you have a newborn on your hands, that means you’ve got 18 years before college, and the cost then will be significantly higher. To give you an idea, 18 years ago tuition prices were roughly half of what they are today. That means if the cost of tuition continues to increase as it has in the recent past, you can expect to spend around double today’s numbers. Knowing that, a public university four year degree may ultimately cost over $100,000 by the time your child is ready to attend college.

Think About Financial Aid

The good news about higher education is there are programs out there to help with some costs. Financial aid comes in the form of scholarships, loans, and grants. So as a parent, you aren’t necessarily expected to foot the entire bill. While you may want to be able to provide for your child’s entire education, they aren’t completely out of luck if that isn’t possible.
So, keep financial aid in mind when planning for how much you’ll need to save. Granted, you shouldn’t be counting on a full scholarship and put off saving completely, but there will be some opportunities available when it’s time for your child to addend school.

Coming Up With the Money

The hardest part is coming up with the money and putting it to work in the right place. Obviously, the easiest thing to do is to simply take some money out of every paycheck and put it into a savings account. While that’s a good start, due to low interest rates you’ll never be able to achieve your goal.
So, you’ll need to look at better methods for saving and investing that money. Probably the most common vehicle for college savings is the 529 plan. These plans have many advantages from tax deductions on contributions, tax-deferred growth, and tax-free withdrawals for qualified expenses. If the tax breaks aren’t good enough, these plans also provide a variety of investment choices to choose from that will allow you to earn more than the fraction of a percent you receive in a typical savings account.
Each state administers their own 529 plan so there isn’t a universal account out there for everyone. The best thing to do would be to start by looking at your state’s plan and examine the benefits. There are situations where another state may offer a better plan and it may be worthwhile to use it instead.
Once you’ve found a plan you’ll want to look at your investment options. Most have portfolios already created that cover everything from the most conservative to the most aggressive investment styles. Again, this will be up to you to choose and you should only invest with what you’re comfortable with. But even the most conservative options will likely generate a modest return compared to the bank or CDs.
To give you an idea of how a little bit goes a long way in a 529, consider this. If you have a child age one or under and begin contributing just $200 a month into a conservative portfolio that generates an average of 5 percent returns a year, by the time your child is ready to begin college you’d have $70,000 saved up! Sure, it still might not be enough to foot the entire bill, but it will make a tremendous dent and keep your child from resorting to going into substantial debt by taking out student loans. A little bit goes a long way when you start early.


Source : financialplan[dot]about[dot]com

Managing your credit card debt

So, you've used your credit card, and you can't make the full payment. Maybe you've been like that for a while, barely able to manage the loan you have with your credit card company. That is not a good situation to be in, each paycheck you get, you have the looming threat of your debt.

To pay off your debt, you need to, every month:

• Figure out your budget. Write down all your income, and write down all your necessary expenses. Food is necessary, beer isn't. That new Blu-ray player isn't, paying the electricity bill is.
• Figure out how much you need to pay. List all your credit cards with their current balance, minimum payment and interest rate.
• Prioritize. The cards with the largest interest rate are top priority. Then in that category, the card with the highest debt is your first priority.
• Meet the minimum. On all your cards, find enough money to pay the minimum monthly payment for all your cards. If you can't pay that amount on all your cards, pay the ones that are prioritized (see previous point).
• Start paying it off. Once you've met the minimum, you can now start losing that debt. Start paying off the high priority card, dollar per dollar. You have to exceed the minimum amount on the top priority card, otherwise you won't be going anywhere. Once that top priority card is paid off, go to the next one. Always pay off the one that has the highest debt and interest rate.

The first couple of months will probably be the hardest, considering the minimum payment is a percentage of your loan for that credit card. Once you start paying it off, that amount will shrink as you pay it off, so you will have more money to use to actually pay off the card, instead of just paying the bare minimum, which will make your debts go away quickly.

If you're in a bind, you can try to call your credit company and see if they will reduce your rate. It will not always work; you're asking them to make less money off of you. But some will if you've been a good client (paying off your debt on time). Calling them won't cost you anything, and the worst thing that can happen is that they refuse. You can always try later in a few months, after you've started paying off your loan and keeping a good record with them.

I realize that this will take time, months and months, but a debt is a debt, banks won't just let you walk free after taking a loan. Plan ahead next time, and don't live above your means.

Take my money,
Phil

Finding a job as a student

As a student, you'll probably need money. Actually, you always need money. So you need to get yourself a part time job that has a good synergy with your schedule. Thought the job itself isn't that important; you can always discuss and change your schedule once you've been hired. As I said, the job itself doesn't really matter; Ideally it's something that you know how to do already, but when you're looking for a student job, you aren't very picky, and neither are the employers. Most student jobs are pretty simple, don't require training and if they do, it's just to learn the ropes of the store, and it's done on-the-spot during your formation period.

Some typical student jobs would be:

• Fast food or restaurant bus boy / clerk / cleaner 
• Cashier work 
• Store floor work at a grocery / large store 
• Movie theater staff 
• Sales clerks (i.e clothing stores) 
• Babysitting 
• Lawn mower 
• Camp counselors 
• Office/Secretarial positions (much simpler than you might think) 

Look for a job near where you live, or near where you study if you must. This way, you know the way to get there, and you're always near, so there is less transit time, and maybe you can come back home during lunch break and save on buying a lunch.

When you've made a list of potential establishments, dress up neatly; you don't need a suit, but leave your torn pants and provocative t-shirts at home. Dress casually.

Go to the establishment in person, and ask if they are hiring part time employees, or ask to see the manager if the person you stumble on doesn't know if the store is hiring. Have a curriculum vitae with contact information with you. After talking to the person, ideally the manager, even if they aren't looking for someone, give them a copy of your C.V., and tell them that you're available for whatever work they have. Visit every nearby establishment repeating this, even if you find a store that is looking for someone; unless they actually hire you on the spot, don't assume you have the job. You might be one of many applicants, and might not get the job. So keep handing out your C.V.

Once you're done, hopefully you get hired. Call back if you don't get any news from the most promising establishment after one week. If you're hired, try to get a good schedule, and don't be picky about the schedule they initially give you, unless the hours conflict with your classes. Try to talk it out and explain that you are attending school. And you can always "trade" your shifts with an other worker. As a last note, don't expect any more than the minimum salary; you're just doing grunt work.

Importance of budgeting

Back on the topic of loans, finances, and budgeting, as a young person, unless you’re the offspring of wealthy parents (or grandparents) who have left you a large amount of money, you need to save money to accomplish your personal and financial goals, or even to just get by. Early in your working years or even before, saving money can be hard. Although you’re likely not earning large sums of money, you can live life and still buy the items (like a car and entertainment) you need.

When you’re first starting out, your salary is probably somewhat low, if not at the minimum, and after essential expenses such as rent or mortgage, food, travel, etc, you may not have much money left for fun spending, let alone putting some money aside in your savings account. Remember, though, that when it comes to saving up money, it doesn’t matter what you how much you make, it’s how much you spend and, therefore, are able to save up. Many wealthy people didn’t get rich based with just their big salaries, but through disciplined savings and wise investing over time, just like common folk. It's the same with people who win the lottery, if you don't have any restraint or planning, you might as well ruin your life with all that money, leaving yourself and perhaps people around you (wife, children) even poorer than when you bought that ticket.

Anyway, People usually learn their financial habits and traits at a young age. During childhood, most people are exposed to messages about money, both at home with their parents and siblings and also in the world at large, such as at school and their friends. All these messages shape up your internal "value" of money, and spending ethics.

Just remember, spend wisely, think about it when you're about to buy something, even if it's just a cup of coffee. Most of the time, you don't need it, it's just a temporary craving. It's not too late to turn around even when you're at the shop in front of the item.

Take my money,

Phil