How to be insured on a budget?
Insurance is not cheap in the United States, to identify if you are overpaying for your insurance we created a guide for insurance on a budget. As of 2017, The median wage in the United States was $44,564. Taking home $44,565 annually would put to in the 15% federal tax bracket and the 6% state bracket without any deductions. That would leave a single woman living in Washington DC with after taxes with right around 35,606.495. We did a general single woman living in Washington search of health plans and came up with an estimated $300 monthly premium and a $6,000 deductible every year. That’s $9600 every year on health insurance alone, add in $1,500 for car insurance based on what the average American pays every year that leaves $24506.495. Now that’s before you deduct living arrangements which you are notoriously high in Washington DC, food, clothing, and incidental expenses. That’s a single person, your premiums go up when there are more people who need coverage. If you are debating whether to save money because you are young and healthy, we strongly recommend you have insurance you have to be prepared financially for unforeseen events. A medical emergency could like you filing for bankruptcy. We created this checklist for people who need insurance on a budget. For this guide we are going to stick with just car insurance to keep it short.
Reducing Car Insurance Premiums
- Pay your premiums every month
- Clean driving record
- High grade point average
- Drive your vehicle less
- Take a driving course
- As you age, your premiums will be less
Pay your premiums every month
Paying your premiums on time every month is crucial to lowering your premiums every year. Do not assume that not paying your premium will be overlooked. An insurance premium is a bill, not paying your bill will be reported to the internal revenue system. Negatively affecting your credit score and raising your future premiums even if you switch insurance companies.
Clean driving record
The more traffic infractions you have, traffic tickets, unpaid fines, driving-related crimes the higher your premiums become. It’s all about how an insurance company can determine risk, and insurance companies have very low tolerance for risk. The cleaner you look on paper the lower your premiums become, as soon as unknown variables start to add up the insurance company raise your premiums. Until insurance companies can determine risk based on live environments data and have a large enough data set to weed out anomalies, your premium is how you look on paper.
High Grade Point Average
A high-grade point will help to reduce your monthly premiums, as some insurance companies offer discounts to “Good Student.” A high-grade point average does not determine a person’s overall intelligence or their driving ability. It does help motivate a student to do better in school, which can lead to entering a better college, and job after college. Having a better job after college, more money for the individual and less overall risk for the insurance company.
Drive your vehicles less
The more you drive your vehicle the more likely something will happen to your vehicle. The likelyhood that you are the atfault or the vicitim in an accident, speeding tickets, everytime you enter your vehicle theirs a risk associate to the insurance company that something could go wrong. Limiting the time spent, lowers the risk and that’s passed on to the policyholder.
Asking your insurance company if they offer an insurance discount if you take a driving course is one way to lower your monthly premiums. For teen drivers, and drivers that are labeled as high risk this is one way to lower with some insurance companies offering up to a 10% discount.
Young drivers are considered high-risk drivers to insurance companies. As you, the driver continue to get older the risk you pose to an insurance agency starts to decrease. There’s not much you can do about age, as we have no control over time, but if you lower the five other ways to reduce your premiums, as you get older your premiums will slowly decrease.
Shopping for Insurance Quotes
Before you signup up with an insurance policy, you should shop multiple different quotes from different carriers. Compare the pros and cons of each policy, and take the best policy that fits into your budget. At VA Car Insurance, you work with one independent insurance agent. That one insurance agent has access to all the insurance carriers live rates and creates an insurance policy that fits your needs. The shopper only has to talk to one person either through email or phone.