Everyone seems to need car insurance and how to save money on that necessity is just one more thing you may be curious about to fix your budget. Most states in the United States require that you have some sort of car insurance before you can even register a car. Saving money is an important part of every household, which is why car insurance is one of the first things someone looks at. Here are 10 of my favorite ways to save money on car insurance!
For some families, paying lots of money for car insurance isn’t possible. They need to find ways to save money to afford the car payment, and that’s why they start looking for ways to save money on car insurance. I’ve gone through this process before and I wanted to pass on some tips of how I went about saving money on my car insurance.
10 Ways To Save Money On Car Insurance
Get rid of the extra car: One of the most reasonable ways to save money on car insurance is to get rid of the extra car. When you have multiple cars, you are going to pay an arm and a leg for car insurance. Although having an extra car is nice, if you are trying to cut back on expenses, it only makes sense to get rid of the extra car. If you are not driving your vehicle because it needs to be repaired or doesn't handle well in the winter, you can actually get your insurance removed for a time period. This can help you save money on car insurance temporarily, especially if your budget is tight.
Take advantage of discounts: When you are choosing a car insurance company, go with the company that can offer you a discount. Typically, most car insurance places do not just offer car insurance, so they can offer you multiple discounts. You may be able to bundle your homeowners/renters insurance, auto insurance, and life insurance together for greater savings on all three.
Compare prices: Obviously, before you take the jump and buy any sort of car insurance, you need to compare prices. This is honestly the best way to get the best deal on car insurance. Don't just compare rates, though. Make sure you check reviews on customer service, are able to pay in a way that's convenient to you to avoid late fees, and see if there is a discount for paying 6 months at a time. That's a great way to use some of your income tax refund!
Be a safe driver: Anyone who’s a driver knows that the best drivers have the best insurance rates. If you truly want to save money on car insurance, you need to be the best driver you can be. Drive carefully, stay alert, and avoid distractions…which may be hard if you have 4 kids in the back arguing about who the best superhero is.
Keep your car miles low: Another great way to save money on car insurance is to keep the car miles low. When you have lower miles on your car, you are seen as less of a risk. While you may not always be able to keep them low if you have a commute, you can still work on upkeep and maintenance. Check out some simple tutorials online or grab the Chilton/Haynes automotive tutorial books on your model of car to help learn more about basic maintenance needs to save money on your transportation expenses. A car in good condition often gets lower rates as well as low miles.
Keep teens off of your car insurance: This may sound harsh, but if you are a parent of teens, this is going to raise your rates just because of their age. My parents had me carry my own policy on my own car so they didn't have to list me on their cars. It saved us all several hundred dollars per six-month policy. If I ever had to drive my mom's car for some reason, she had full coverage insurance on it that would cover me in the event of an accident, without the high monthly premiums.
Give it time: Every couple of renewal terms, my car insurance package drops a few dollars. This is typically due to my car getting older, having no accidents, and just overall being a good driver. Another benefit of time is as you get older your rate will lower. Usually, age milestones like 18, 21, 25, 30, 35, and 40 are all times you will see a drop in insurance costs.
Share a car: If you are married or living with someone else, sharing a car makes complete sense. This can also help you save money on car insurance because you will be splitting the cost of it. This only works if you both have good driving records, though!
Don’t get more insurance then you need: It’s almost ironic that we are paying every month for something that may happen. If you aren’t driving a super nice vehicle, then perhaps only getting mild coverage is just what you need. There’s no sense in buying more insurance than you need. We have basic liability on all our vehicles, except my minivan. It's pretty old, but it's the only vehicle I have to transport all four kids at once and I'm terrified of an uninsured driver hitting me.
Choose the highest deductible you can: If you've been working on your emergency fund, you should be able to pull $1,000 from it in the event of an accident for your deductible. If you have a fully funded emergency fund (3-6 months worth of expenses), you can set your deductible even higher. Just make sure that if something else happens and you have to touch your emergency fund, you contact your insurance agent & lower your deductible until you've had time to rebuild!
As you continue to work harder to live a frugal life, learning how to save money on car insurance is just another piece in the puzzle.
What are some of your best tips for saving money on your car expenses?