#7 Buying Insurance Part 1

When it comes to buying car insurance people have no idea what they are buying and what they should be buying. Do you know what your car insurance really covers? When was the last time you went out shopping for car insurance. We all just assume that we are getting the best price for our coverage, WRONG. Here is what I do and what you should probably do.

(1) be a safe driver and slow down on the road, avoid tickets. When you do get trapped in one of those traps and get a speeding ticket always always always fight it, PLEA-NON Guilty. Remember this is how cities, counties, and municipalities make money (and taxes of course). This will avoid those costly points on your driving record. If the choice is to pay a heavier fine for fewer points do it.

(2) shop till you drop for car insurance. You should be shopping for car insurance every 1-2 years, I do. Call around and get a few quotes. One thing to watch out for, make sure the insurance company is running a “soft hit” when they check your credit and not a “hard hit”. Even better if you already know your score let the insurance agent run with that and they will give you an estimate (which is what it always ends up being anyway).

(3) Know what you are buying. There are certain formulas I use to see what type of coverage I actually need. Insurance sales people are “sales people” and they love to up-sale. If you have a 10 year old car that is worth say $5,000 you probably do not need comprehensive and collision. What it covers is if you are at fault or an uninsured smuck hits you, you are covered. If someone hits you, their insurance will have to pay you. In this scenario all you really need is to be a safe driver and “liability insurance”, incase you hit someone else.

(4) Combine coverage car, home/renters, life, etc.

(5) Negotiate the final numbers. Play other insurance company against each other for the best rate, it can work.

Last year I switched from Liberty Mutual to NationWide and “I saved a bunch of money on my insurance”.


#6 Heating and cooling bills

Are you just throwing your $$ out the window by spending to much on heating and cooling your home? Most people do, because they do not know the simple secrets on how to save big bucks on their utility bills. I have a 3000sqft home and we spend very little money compared to other similar sized houses in our neighborhood. Below is what we have spent in the last 10 months on gas and electric, keep in mind I live in Austin, TX:

On average our combined utility bill is $127.00 I think that is very efficient. So how do I do it? Get a programmable thermostat from home depot for about $30 bucks or so. I have the one shown in the previous link and it is easy to install and use, but for all you macho guys who don’t read directions, make sure you read this or it will kick your ass. Once you install it properly make sure you actually use it for its intended purpose, program it. It has a guide in there on how you should program it, but I suggest you throw that away. Here is how I programmed it. In the summer set it for around 81-82 degrees when you are not home, if you have pets then keep the fan on. Set it to start cooling the house about 15 minuets before you get home from work. I keep our house at about 76-77 in the summer and believe me that is comfortable. In the winter we keep the house at about 68-70 when we are home and 62-64 when we are not.

If you get direct sun light into your house invest in some black-out curtains or something similar. The less sunlight you get in the house in the summer the cooler the house stays, yes thats common sense. We keep the house completely shaded during the day when we are out. It makes a huge difference. Vice Versa in the winter, you might want to keep your curtains open to let the sunlight in.

Here are other tips that are also important to implement.

#5:Gas tips

The price of gas is almost at $4.00 a gallon. Lucky for me I do not have a gas guzzler, but I still feel the pain. Well there are definitely a ton of things you can do to save gas but I am not here to give you common sense advice, visit here.

But here is what I can tell you:

1. Fill up your tank when it is cooler out, in the morning or late at night. Without going into the molecular structure of gas I can tell you that gasoline expands like anything else when the temperature goes up. The opposite when the temperature goes down. So when it is cooler out you actually get more gas for your money. Sorry I have no way of calculating this since there are too many variables.

2. When the pump shuts off, pull out the nozzle half way and turn it 90 degrees. There is still fuel remaining in that nozzle, fuel that you paid for.

3. Proper tire pressure is so important. Think of it this way, if you had the correct pressure in your tires it would take less energy to move your car forward. Now imagine you had 4 flat tires how much energy do you think it would take to move your car forward. For every square inch of pressure under the recommended, you use more energy.

4. If you are looking for an alternative way to save more then a few cents on your next fill up, then you will love my next tip. RUN YOUR CAR ON WATER!! This is a true and proven thing. I helped a friend convert his 2006 Honda Civic, and it works. You actually add about 10-15 miles to each tank. That adds up fast and you do not even have to buy an expensive hybrid. See what I am talking about below:

If you want to learn how to burn water in your car then, click here.

#4:Store Coupons

Here is my take on using coupons when shopping. Coupons are an easy way to save huge amounts of money on products you use everyday. I have a receipt here from our last shopping trip to Wal-Mart and we saved, drum roll please, $45.15 from the total bill of $169.31. That savings is a fill up at the pump for people with normal cars. To put it another way if you went shopping each month for a year and say you saved $50 each time, at the end of the year you will have saved, $600. What can you do with $600?

Now I live in Austin, and the stores around here do not double or triple coupons. In the Northeast most grocery stores let you double or even triple the face value of the coupon up to $.99. Looking at my receipt if all my coupons where doubled I would have saved, $54.80 and if tripled $64.45 on this trip. Yearly that adds up to $657 and $773 respectively. That is big money savings over time!

(The black side) Now most of you are probably saying (looking for excuses) there are never any coupons for the stuff I buy or the coupons are always expired when I go to use them. Here is the answer thanks to technology and automation, go to self checkout. If you have a ton of expired coupons and they are similar in what you are buying use it through self checkout. There is no $5.50 pesky cashier to stop you from using those coupons. What ever way the coupons and the store software is coded, it is not perfect; yes there is a hole in the system. You can use as many expired coupons you desire.

#3:Moving Boxes

Do you need moving boxes? Well the best place to get unlimited FREE boxes is Wal-Mart or a similar type of store. When we moved 3 times in the last 2 years we went through over a hundred boxes. If we had to pay for them it would have cost $100’s. Here is an example of what U-Haul is selling boxes to pack a 1-2 bedroom place. It’s crazy to pay for moving boxes when you can get them for FREE. I have heard some people say “well we bought boxes because the free boxes are dirty and have bugs in them”, not true. If you go to say Wal-Mart or Target you can get boxes from any of their gazillion departments. Stay away from the food boxes if you are worried about bugs. Most of our boxes came from the kitchen and laundry department which hold pots, pans, laundry baskets, etc. These boxes are good in size and strong.

The only caveat about getting boxes from a store is that you have to go late at night, but who cares when they are free. Instead of going out bar hoping the night before your big move go to Wal-Mart or Target for FREE boxes.

By reusing these boxes you are also doing a kind thing to the environment, cutting down less trees. The more demand you create by buying boxes the more you hurt your environment. Even if you use say “recycled boxes” it still takes energy to recycle them, common sense stuff. Bottom line is that when you get your boxes for free it serves everyone well.

#2:Dining Out

Eating out is probably most people’s single biggest monthly expense . My wife and I spend around $350 a month eating out. We eat out about 4 times a week. I know some of you are probably thinking that is cheap and yes you are right. Keep in mind we eat out at all types of restaurant, from hole-in-the-walls to fine dining. To give you a better idea of the places we normally eat out at, they cost around $25-30PP. So if you are trying to do the math that is about $22, for 2 people, every time we eat out including tax and tip. So what is the trick to saving money NO soda, share your meals and tip based on the level of service.

1. Do not order any soda, drink water (it is better for you anyway). Soda on average costs about $2.65 at most restaurants. So when you do the math what does 2 sodas actually cost, $6.74. Below is a breakdown of the costs.

Not to mention the negative health effects soda and especially diet soda has on your body.

2. Share you meals, order only one entrée and if you are really hungry order an appetizer. We live in a country where the portion sizes are so huge that in a 3rd world country a family of 4 can eat from just one American entrée. Most restaurants do not have a problem with sharing a meal but most people just assume or maybe it’s the social thing that make them feel uncomfortable ordering one meal. Just think about the last time you went out and whatever you ordered, did you finish it? If you did not finish it, did you take it home? When you took it home did you actually eat it or just go out to eat again and throw out your doggy bag? Yes it can be a vicious cycle. Just order less, thanks to the generosity of most restaurant’s portion size you will not leave hungry. There is also a health benefit here, you are not walking away with that “I’m so f*&k%$# full” feeling, it sucks. If you are by yourself you can get just the kids meals most places.

3. Tip based on the level of service you received and not on what you think everyone is tipping (screw the social pressures of tipping). Do not be a smuck and tip a bad waiter/waitress 20% or more. Tip 20% and never more only if they really earned it. Think of it like this, does your boss give you a raise based upon your performance, yes most probably. So you should use the same model, pay for performance. When the service is really bad I leave a big fat $0 with comments on the receipt, so the waiter/waitress knows why they earned what they did and hopefully the next person will get better service.

#1:Pre-Paying Medical Bills

My wife and I are expecting our first child and the OB office asked us to prepay our portion of the hospital medical bills. Prepay for medical services when you have insurance? That is ludicrous. Why in the hell would I have to prepay for service that have not yet been rendered? Because the OB office wants to hedge their risk and make sure they get their money. So I called the insurance company and asked them if there is anything in my policy that requires me to pay for any services and just as I thought, nothing. Then I called the OB office and talked to their finance person and told them that we would not be prepaying for anything, and all the charges have to be ran through the insurance first. To my surprise they did not push back much except saying that this has always been our policy. You will get to know me, I do not care too much about policies that are made up to favor the business and screw the customer.

The problem with prepaying your medical bill is that when everything is ran through the insurance you could actually owe a lot less, do you really think the provider is going to send you a check back because you overpaid, NO!

So the OB suggested that we should pre-register for the deliver so when you check in the day of delivery you are not bombarded with a ton of paper work. Thinking nothing of it we did. Then we get a bill in the mail from the hospital asking us to prepay for the hospital portion of the estimated charges. WOW! It was over a $1000 and that is stupid because what happens if for some reason you do not end up delivering at that hospital. Are they going to send you a check back, Hell NO!

If your OB office doesn’t give you a break you can always negotiated the terms of payment and the actual amount.

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