How many times have you heard someone suggest that all their financial problems would magically disappear if they only made more money? But high incomes can’t guarantee financial freedom; there are countless examples of people who earned millions yet still ended up bankrupt. The common thread among folks who get into financial trouble — no matter how much money they make — is their inability to consistently spend less than they earn.
The bottom line: The ultimate measure of financial success is not the size of your paycheck. Rather, it’s the money left in your pocket after paying for all your obligations.
source: Len Penzo
Every few months to year I take a look around to see if anyone can give me a better rate on my auto & renters’ (home) insurance. This month, after 3 years, I found a carrier who could knock about $60 a month off my payment *and* give me more coverage.
Interesting things I learned in this process:
- you want a Personal Liability Protection – “umbrella” – policy
- provides coverage over-and-above the limits on other policies you hold
- follows you world-wide (at least with my carrier)
- individually-scheduled items on a renters’ (or home) policy are covered even if something happens away from home
- say you have your wife’s engagement ring individually-scheduled
- if she loses it at the beach, it’s still covered
- if it’s stolen from home, it’s still covered
- the cost of adding individually-scheduled items is a fraction of their cost to you if something goes awry
- max-out your auto policy’s limits – you’ll get better rates
- if you carry state minimums (25k/50k in KY), you will have a higher rate than if you increase your coverage levels (it was a $300/year difference for me (not that I’d ever take minimums, but it was still interesting)
- the insurance companies factor-in your “insurance intelligence” when giving a quote
- if you pay for more coverage, you’re “smarter” about insurance, and less likely to have a claim
- the company you’ve been using for years takes all the factors in your driving, credit, and other relevant histories and calculates your risk to them differently
I was with my last carrier since moving to KY in 2010. I don’t know how long I’ll have my new one, but for now, increasing my coverage, expanding its scope, and reducing my payments are all great.
I went from 2 to 3 policies (including the new PLP), and am pretty excited (though, of course, I also hope to never need them).
The Richest Man In Babylon by George S Clason is one of the few audio books I have enjoyed – and one that I think everyone should read/listen to frequently: it’s the early 20th century version of Dave Ramsey’s Total Money Makeover (another great book).
The advice/suggestions in this book are things I didn’t listen to soon enough – and I’d hasten to help anyone do earlier what I didn’t 🙂
If you take nothing else from this book, follow the first “law”:
The first 10% is mine to keep
From a Christian perspective, that should be reworded to “the second 10% is mine to steward” (if you presume the first tenth belongs to God).
This sounds difficult – but if you incorporate that single principle into your financial thinking early, you will be very well served later in life.