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6. Your car and home insurance.

Welcome to the Dad Cents, capsule no rx 10 ways to put money back into your budget without stopping the fun stuff, series. The countdown continues with the first of two articles about car and house insurance.

6. Your car and home insurance.

Can you really save 15% by switching to another insurance company?

Every insurance company works under the same premise; take in more money than they pay out! Come to think of it, every successful business I know, works in a similar fashion. One key to success for insurance companies is to spread their risk across the area they service, whether local or national, just like a wise investor.

By law, we must have liability insurance on our vehicles.  Furthermore, an insurance company mandated requirement exists for coverage on your home while you have a mortgage. Unfortunately, eliminating debt on our vehicles and home does not remove our requirement for insurance (once a house is debt free the requirement is removed but the financial and liability risks are much too high to cancel the policy). Chances are we probably will have insurance payments for the majority of our lives!

The huge question is, “Are you paying more than you need to for your coverage?” When I watch TV, every second or third commercial suggests an answer to this question. “You can save money by switching to our policy!”

I am very intrigued when I see this battle persisting when I know every insurance company is regulated in the same way; by the state in which they are licensed to operate. The state regulations also set the rules for what insurance companies can and cannot do! For example, all the companies have mandated reserves to cover pay outs when accidents or catastrophes occur.

However, if they are all treated similarly by law then how could one company say you can pay 15% less with their company?

The answer is: Their philosophy on local agents! Fifteen percent is roughly the cost of paying a neighborhood insurance agent to meet with and help policy holders. Most internet insurance companies do not have local agents, or if they do, the agents are very sparse. Even though some companies may have representatives in locations, their main contact points are either the internet or via phone.

I have several concerns with most families utilizing these types of companies. Car and home policies have many intricacies that can cause headaches and leave them underinsured. Here are a few thoughts to help you make a good decision.

Keys to making a good decision:

  1. Do you have a very good knowledge of insurance?
  2. Can you get the kind of personal service you desire?
  3. Have you had many claims in the past?
  4. Is the company financially sound?
  5. Check with your state insurance commissioner about track records of the companies. It is much easier to find out about customer service before you make a change rather than learning the hard way.

In the next article, I will talk about the importance of having the proper coverage and some considerations so you can get the best policy for your family!

Is it possible for everyone to use these ideas? Maybe, but I will make one promise. If you do not try, you will not save money!

Make sure also to watch for our next Savvy Dads webinar!

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Wednesday, June 22nd, 2011 Teaching 1 Comment

7. Your TV/Internet/Phone bill.

Welcome to the Dad Cents, 10 ways to put money back into your budget without stopping the fun stuff, series. The countdown continues.

7. Your TV/Internet/Phone bill.

Are you paying an arm and a leg to be connected?

My wife and I sat down last week to watch TV, and as she scrolled through our at least 200 channels she said, “How can there be nothing on TV?” Our world has dramatically changed even from the time I was in college. As I sat down today to write, my wife’s comment reminded of my college years and the Bruce Springsteen song 57 Channels in which he sang “There’s fifty-seven channels and nothin’ on…”.

Today, we have the opportunity to be as connected as we desire. Our Televisions, internet service, phone service and mobile service give us the ability to be in the know and always in reach of our friends, family and work. Smart phones allow us to do all of these things in one device!

The key question is: Are you paying too much to be connected?

Media companies want us to buy their bundle! These packages are advertised relentlessly via billboard, radio, the internet and TV. The gist of the ad is you will pay less for their bundle than by purchasing elsewhere. The media companies are using the same theory as the insurance companies.

The theory the media companies’ use says you will be more likely to remain a customer because of the number of connections you have to their company. For example, one company is easy to work with, but if you have your phone with one company, the internet with another, and TV with yet another, you will have to pay multiple bills get multiple statements and have more companies to deal with. However, are they giving you the best deal?

Companies are always changing the rules but many times, the bundles, are not the best deal. Just recently, I was encouraged to look into my service by my bank account because we could not afford the bill. I thoroughly looked through all the opportunities and found I could  save $35 per month and actually get faster internet service by making a change out of a bundle!

Keys to making a good decision:

  1. Does your rate eventually increase?
  2. Can you get good or better service by separate companies?
  3. Are you buying the package that has more channels than you actually watch?
  4. Will you share band width with your neighbors?
  5. Can you get internet service without purchasing phone service? (VOIP service can be very inexpensive)

Is it possible for everyone to use these ideas? Maybe, but I will make one promise. If you do not try, you will not save money!

Make sure also to watch for our next Savvy Dads webinar!

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Monday, June 13th, 2011 Teaching No Comments

New series: 10 ways to put money back into your budget without stopping the fun stuff!

The economy has been brutal to many and putting money back into the budget would be helpful to many families. Over the next several weeks, online I am going to write 10 posts covering easy, advice practical methods to reduce your spending without ending your daily Starbucks run, Sonic happy hour or eating out on Fridays. Alternatively, your conscience may speak and encourage you to begin giving more to your church or a ministry in need!

If you apply the ten ideas I will share with you, I believe you will have the potential of putting $100-$400 per month back into your budget. Some of you may know and already be applying some of these ideas, but together they can dramatically help you improve your monthly cash flow.

The first series post will be Friday, May 20th at www.dadcents.com/blog. Please share this with your friends!!!

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Thursday, May 19th, 2011 Financial concepts No Comments

Do you influence your teen’s money habits?

The results of a new poll by the Northwestern Mutual Foundation’s financial literacy Web site, Themint.org show YOU, the parent, have the greatest influence on your child’s money habits! According to the press release, “The poll asked teens to choose who had the biggest influence on the way that they saved or spent money. In a landslide, seven out of ten kids aged 17 and younger said “parents” swayed their actions the most, outpacing “friends” (16%), “TV, magazines, books, radio or celebrities” (14%), and “teachers” (1%).”

Do these survey results surprise you? The results may or may not be a revelation to you but the end result should be an evaluation of your preparedness to model and teach your children. Would fear or relief be your response if you knew your children would have spending habits just like yours when they become adults?

Northwestern Mutual’s survey “also asked teens how they would grade their parents as role models for saving and spending money. Nearly seven out of ten kids aged 17 and younger gave their parents either a “B” or a “C” grade, saying that moms and dads should spend money more responsibly and involve everyone in conversations about the family budget. Less than 30 percent of children honored their parents with an “A.” Fortunately, only two percent of parents received a failing grade.” How would you grade your ability to model wise financial decisions?

I have found kids are always ready to evaluate their parents but are you ready for the answer? I know teaching your children financial principles is challenging because it is not second nature for most of us. You have a responsibility to your children and I recognize the desire of every parent I speak with is for your children to leave home knowing more about money than you did when you left your parents home.

What are you going to do to affect that change?

 

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Wednesday, April 20th, 2011 Financial concepts No Comments

Traveling Dads: Ideas to help keep in touch with your kids

Do you remember the old Cingular commercial where the dad took a stuffed animal on the road and took pictures of the animal in each place he visited?  I found it on Youtube for those who do not remember. 

My daughter saw the commercial and would strategically hide the animal somewhere in my stuff! As I would take pictures, I emailed or texted the picture back to my wife and daughters to see where I was and what I was doing.

I was asked an awesome question this week and wanted to respond with on my blog as well as a personal message.  “I am away from my daughters this week for business and am really missing them. Do you have any clever ideas on how to connect?” was the question posed. I traveled quite a bit last year and have some ideas that I found to be very effective. 

I do realize that several of these options need to be initiated before leaving for a trip but some are doable even while on the road. 

I pray with my daughters every night before they go to bed, so when I travel, this is sometimes a challenge.  I know  many dads who love to tell their children, especially those of us who have daughters, good night before they go to bed.  I have several solutions for this issue.

  1. Call them on your mobile phone no matter what you are doing! If you need to excuse yourself from the meeting, then do so, to talk to them before bed.
  2. Before you leave, make a video for each night you are gone. It does not need to be longer than 30 to 90 seconds. In this age of easy video on phones and every digital camera available, make a short video for each child.  This does take some time, but I have found is well worth the effort!

Staying in contact during the day can be a challenge but here are a couple of ideas.

  1. If your children are old enough to have mobile phones then texting is one option.    
  2. A really cool connection point is using video on your phone to send them a recorded message via sms (text messaging).  I can record a short video on my phone and send it to my wife’s phone, which she and my daughters can watch. She in return can make a video response with the girls for me!

Another great option is to use Skype or Oovoo to stay in touch.  They are even better if you have video capabilities on your laptop and computer at home. This past December I spent a week in Romania and could  speak to my wife and daughters via Skype. Skype is even available on your mobile phone through an android and iphone app.  

As a final note, I want to encourage the dads to really think ahead about staying connected.   Traveling can be a break from the day to day stress but it also is a time for temptation.  I know when I stay connected, my mind stays at home when my body is on the road!  

I would love to hear from anyone who has more ideas about staying connected while on the road.

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Tuesday, March 1st, 2011 Teaching No Comments

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