How To Budget For Insurance
The cost of insurance can be a big hit to your personal bottom line. That’s especially true when you consider all the types of coverage you may need to pay for, including auto, health, and life insurance plans.
Steps for Budgeting for Insurance
Insurance is often a good investment for your wallet and your peace of mind. The expense of insurance can actually save you money in the long run.
Decide how much insurance you need
When it comes to insurance, cost shouldn’t be the only factor in your purchase decision. Instead, think critically about how much coverage you need.
Get quotes from agents or online
Once you know what type of insurance you want and how much coverage you need, get some quotes. Remember to compare the coverage and not just the premium price—you might find that you’re getting a much better value when paying only a little more a month with one company over another.
Find out what the payment schedule is
Discuss the payment schedule before you agree to an insurance policy. Understanding the payment schedule will help you budget for insurance more effectively.
Set aside enough money monthly
However you plan to pay for insurance, break the amount down into a monthly budgeted amount. For example, if your home insurance is $900 every six months, set aside $150 every month.
“Pay” the bill monthly
If you do pay monthly, go ahead and budget so that you can pay your insurance bill at least a week before it’s due. That leaves you plenty of wiggle room if something ever comes up.
Tips for making various types of insurance potentially more affordable so they are easier to budget for.
- Increase your deductible - Ask about discounts - Lower your liability amounts
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