Here's a tip that may reduce your auto insurance costs:
If your deductible amounts for comprehensive and collision coverage are $500 or less, consider raising them to $1,000. It could slash your premiums by up to 20 percent, says Ernst & Young, an accounting firm.
A "deductible" is the amount you pay before insurance kicks in. For example: If you had a $2,000 fender bender, with a $1,000 deductible, you'd pay the first $1,000, and your insurer would cover the rest.
Most people have $500 deductibles because they're considered standard." By accepting more of the risks yourself, you could DTC pocket some extra cash to save or invest.
In an Ernst & Young test case, the annual premiums on a 1990 Honda Accord were slashed from $1,250 to $975 when the deductibles were increased from $100 for collision and $500 for comprehensive to $1,000 for each. That's a savings of $250. (Comprehensive insurance covers damage to your own vehicle, while collision covers damage to someone else's car.)
The amount you actually save will vary, depending on the type of car you drive, your driving record, insurance carrier and the city where you live.
Another benefit of having a higher deductible: It reduces the likelihood that you'll make claims against your policy. And that, too, will help hold down your premiums.
Before acting, call your insurance agent to see if the saving is worth the risk for you.
Note: Not everyone can use this strategy. If there is a lien on your car, the lienholder may set a minimum level of coverage.
Would you rather be rich, beautiful, famous or younger? In a recent survey of 50,000 American women, 71 percent chose the cash, according to Woman's Day magazine.
About 7 million workers will get lump-sum retirement-account distributions from their employers over the next year. But most won't be retiring. They'll be changing jobs, or maybe their pension funds will be terminated.
Generally, income earned in a retirement account is tax-deferred. If you get a distribution, you must reinvest the money in another tax-deferred retirement account or pay taxes on it, plus a 10 percent penalty.
If you need help deciding what to do with a lump-sum distribution, T. Rowe Price has a free booklet that might help. It's called "Deciding What to do with Your Company Retirement Money." Call (800) 472-5000.
Attention, homeowners. A new scam is making the rounds, and it works like this:
You get a letter saying that your mortgage has been sold to another lender, and you're instructed to begin mailing your monthly checks to a new address. You also may get a new loan-coupon book.
But here's the catch: If you start sending your payments before you check it out, you may find that you've been duped.
Aside from losing hundreds, or maybe thousands, of dollars, you'll also have to pay your real lender. And your credit may be tarnished if payments are late.