Archive for October, 2010

Save Money on Your Car Insurance

By: Green Panda | Date posted: October 06, 2010 (5:00 am)

For some college students, having car is a necessary expense. You may live off campus, you may have a job on the other side of town, or your city lacks a solid public transportation system. Whatever the reason, if you have a car you need to keep your expenses manageable.

A big expense with owning a car is having the proper insurance for it. The average annual car insurance premium for Americans ages 18-25 is $1566. It can be much higher if you live in a major metropolitan city.

How You Can Lower Your Bill

If possible, see if you can lower your premiums without sacrificing coverage.

  • Stay on your parents’ plan – As a college student you can receive some wonderful benefits. One of them is taking advantage of your parents lower premiums. Simply pay them the additional premiums for keeping you on.
  • Increase your deductible – If you have your own plan, see if you can increase your deductible. The higher it is, the lower your premiums are. However, if you have no emergency fund to cover the deductible, then wait.
  • Be a fantastic driver - Avoiding speeding tickets can save you big time. You may already have higher premiums than your family even if you’re a better driver due to your age.
  • Keep your grades up – Being on the deal list isn’t just good for scholarships, you can also a discount on your insurance premiums.

Shopping Around Can Save You Money

It might take some legwork, but looking at other companies can prove to be fruitful. My mother was able to get my brother’s portion of the premium lowered just by mentioning she was hunting for a better deal. Cutting 30% of her bill wasn’t bad for a 10 minute phone call.

As you’re shopping around, have a copy of your current policy. It is easy to forget what your policy exactly covers. I’d also go ahead and ask friends what they think of their own insurance. The cheapest policy might not be the best.

Thoughts on Car Insurance

Have you been able to cut down on your car insurance premiums? Which companies do you recommend?

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Retirement Planning When You are in your 20s

By: Mike | Date posted: October 04, 2010 (5:00 am)

When you are in your 20s (and for some people it is the same reasoning in their 30s), you don’t necessarily think about retirement planning. In fact, you are more concerned about finishing school, getting a good job, making money, paying off your debts, getting married, buying a house, having kids, etc. You may think that retirement planning is for old people, that you don’t need to think about retirement and that you will surely end-up with a pension plan or that you will manage it when retirement time comes around. However, we should all consider retirement planning as soon as possible. Ideally, your retirement plan should start as early as you when you land your first job… while still in school.

The power of compound interest; the very first reason to start a retirement plan today!

It is true that you don’t know when you are going to retire, or how much income you will need. But one thing is for sure; don’t count on the government or on a big fat pension plan to make your retirement comfortable; this ain’t going to happen! So if you have to put money aside in order to retire richer and happier, you should start as soon as possible. You don’t think that $25/month would make a difference? Here how it goes: $25/month at 6% gives:

4 096.98 $ 10 years
7 270.47 $ 15 years
11 551.02 $ 20 years
17 324.85 $ 25 years
25 112.88 $ 30 years
35 617.76 $ 35 years
49 787.27 $ 40 years
68 899.82 $ 45 years

And the math doubles when you do  $50/month:

8 193.97 $ 10 years
14 540.94 $ 15 years
23 102.04 $ 20 years
34 649.70 $ 25 years
50 225.75 $ 30 years
71 235.51 $ 35 years
99 574.54 $ 40 years
137 799.63 $ 45 years

As you can see, this is very profitable to start at a young age since you can get used to dropping $50 per month in your investment account at the age of 20 and get to a nice 137K in your pocket when retirement hits at 65. If you increase your systematic investment each time you get a raise, you will end-up with half a million in investments just with the power of compound interest.

You don’t need a complete retirement plan; just a line of direction

If you are in your 20s or 30s, it is true that you will go through different life events that will change your financial situation. These are the 2 decades where you will go through the most important financial steps of your life. You may change careers, move outside the country or get married. However, this won’t change the fact that you need money at retirement.

This is why establishing a line of direction (through an investment plan, asset allocation and systematic investments) will insure a comfortable retirement whenever you decide that waking up at 5am is too early for you ;-) . The base of your retirement plan will follow you through your life and only serves to push your net worth higher in the meantime.

So when should you start thinking about retirement? Do Not Wait and do it right now Giveaway

This article was to introduce our new site about retirement planning; DoNotWait.com. Do Not Wait! will be concentrated on  questions you may have about retirement and how to get there. For its launch, we are giving away more than $1,000 in prize! Here are a few examples:

- iPad from Apple

- Cash prizes

- Books

- Dvds

- Gift cards at Amazon

How to enter the giveaway?

All the rules are explained in the DoNotWait! and Do it Now Giveaway. The contest starts October 4th and ends for Halloween at October 31st.

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