Review Your Insurance Coverage

Young people in particular have unique challenges when managing debt during periods of unemployment, since they haven’t built up enough home equity or other investment assets to tap. Some tips:

1) Rework your student loan: If you’re worried about a student loan, call your lender about entering a period of forbearance or deferment. This won’t kill your credit, and it will allow you to reduce or postpone payments until you’re back on your feet.

2) Play the credit card game: if you have good credit, apply for a balance transfer or new card with a 0% or other low introductory rate. This will help to freeze your debt for six months to a year until you are back to work. Try to avoid cards with high balance transfer fees though.

3) Loan yourself money: if you are seriously worried about missing payments on any loan, you are risking the possibility of serious damage to your credit. Consider looking at your any 401(k) plan or IRA you have to see if it allows you to loan yourself money. This can provide a temporary solution to tide you over.

Rohit Chopra
Director, Center for Sensible Finance
http://www.sensiblefinance.org Review Your Insurance Coverage18689Review Your Insurance CoveragePeople who are out of work and looking for an instant money fix may be surprised to learn their home and/or auto insurance may provide thisextra money. I co-own an insurance agency with my son in Northern Nevada. We have helped hundreds of people save money on their home, auto, or both, insurance policies.

If I was in this situation, the first thingI’d do is find my policies and start calling insurance agencies. I’d start with the independent agencies.

We are an independent agencyand all thatmeans iswe aren’t captive to one particular company. This gives us the advantage of being able to shop your coverage among many companiesto get the best possible price.

One example to give you the power of insurance shopping. A particular client was paying $5,000.00 per year for both his home and autos before I contacted him. When I spoke with him he agreed to bring his policies into the agency for a review.

As we went through his coverage, we not onlyhelped himupdate his coverage to meet his current economic situation but saved him a good piece of change. The savings, and it was drastic,was$2,500.00. We had reduced his annualpremium by 50% making his new yearly premium only $2,500.00.

He enjoyed the exact same coverage but for less money. If my math is correct, a little over $200.00 a month stayed in his bank account.

I do not mean to imply this will happen to everyone because it won’t. Even if you only save $300.00 per year, for example,that is an extra$25.00 per month staying in your pocket.

Since this is a quick tip, I won’t talk about saving money on health and life insurance. I’ll leave that for another article.