From the Mailbag

I’m hoping you have some advice on lowering the costs of my insurance. I feel like my insurance bills are killing me!

– Justin

Hi Justin!

When I’m working with students in our Artist’s Prosperity Boot Camp – one of my favorite exercises is going through their individual expenses, finding all the places they can save money. Insurance is an expense that many of us assume we can’t change. But in fact, there are two ways to trim insurance costs.

First, shop around. An insurance agent recently mentioned that one auto coverage firm he represents prefers drivers between ages 40 and 60. He assured me that other companies act similarly. Therefore, when your birthday arrives, an insurance company that used to charge high rates may suddenly become the least expensive option available. When applying, ask about discounts. You may belong to an organization that has negotiated lower rates for members. There may also be discounts available based on your driving record, driving distance, auto type, or even school grades.

Second, raise your deductibles. Be careful and thoroughly read my explanation of this tactic before implementing my advice. A deductible is the amount you’ll pay if you file a claim. By raising the deductible, you’re accepting more risk before the insurance company is forced to pay. This lowers your rate. If you don’t have an emergency reserve, don’t raise your deductible! If an accident occurs and you have no resources, you’ll find yourself in debt. Once your reserve is established, you’ll enjoy lower insurance rates and have a cushion to protect you if disaster strikes.