Raise My Insurance Deductible?

Why Would I Want to Raise My Insurance Deductible?
We’re all looking for ways to save a buck or two. When it comes to homeowners insurance, a great way to put more money in your wallet is to bump up your deductible.

“Won’t I have to pay more when I make a claim?” most people ask. Yes, but you’ll likely save in the long run.

If you’re like the average homeowner, you’ll make a claim only once every nine years (and often wait considerably longer). If you can save a little more than $100 a year in premiums by raising your deductible, the math typically works out in your favor.

Making this adjustment to your deductible results in a threefold benefit:

Lower premiums: A higher deductible reduces the cost of your insurance.

Increased cash flow: With less money flowing out of your account to cover insurance premiums, you have more on hand to cover other regular expenses (like groceries, the heating bill, and transportation expenses).

Reduced claims: If you have a small loss or theft, where costs will likely fall short of your deductible amount, you can opt to not file this claim and decide whether you want to replace the item. Fewer claims help keep your premiums lower.

If you decide to go this money-saving route, it is important to establish a savings “buffer” by creating an emergency fund that you can easily access if you need to cover the full deductible. Your insurance advisor can review deductible and premium options with you to determine the best fit for your financial needs.

Exercise = Weight Loss: It’s Not That Easy

For years we’ve been told that weight loss is a simple equation: the more you exercise, the more weight you lose.

Sadly, it’s not that simple. Exercise improves physical and mental health, lowers blood pressure, and reduces the risk of acquiring Type 2 diabetes and Alzheimer’s. It’s a stress reliever. But according to an article onĀ Vox.com, some 60 studies have found that exercise’s impact on weight loss is not that significant.

It’s explained this way: We gain all our energy from food. But thanks to our basal metabolic rate (over which we basically have no control), we use 60% to 80% of that energy just to function. We use 10% in digestion, leaving only 10% to 30% of energy available to be burned in physical activity (which includes exercise).

What works then? Interestingly, researchers have found that those who are successful in losing weight “weigh themselves at least once a week. They restrict their calorie intake, stay away from high-fat foods, and watch their portion sizes. They also exercise regularly.”

Hey. We knew it all along.

Tech Devices Can Teach Your Kids Money Management
Tech Kids

Our kids may be computer whizzes, but chances are they’re not very financially savvy. Money management is an essential life skill, and one that’s not usually taught in school. But perhaps it should be; the consequences of not knowing how to manage money as an adult can lead to a host of money mistakes. Hence the introduction of device-based programs to teach kids about managing money.

One British start-up, Osper, has been offering a mobile banking service for children as young as eight that is designed so parents and children can work together to manage the child’s money. It uses the technology that kids understand so well and offers parents the security of oversight.

The service functions like a prepaid credit card: The child is the cardholder and he or she can use it to make purchases in store, online, and for transactions at banking machines. Parents fund the card according to a budget they create with the child. An app helps them track spending, and parents can lock the card if it’s lost or stolen.

Bankaroo is a similar service and allows parents to keep track of their children’s earnings from chores and allowances, and to follow their spending. A multi-child family account permits money transfers and tracks the children’s individual financial goals. It’s available in different currencies and languages, as an app for iOS and Android, and on desktop.

Good news: Bankaroo is now being offered in some North American schools. So tech-focused money management courses may soon be available at a school near you.

Umbrellas Are Important on Sunny Days, Too
You have homeowners insurance. You have auto insurance. You’re covered, right? Your skies look clear. Why would you need an umbrella policy?

Picture this: You’re hosting a neighborhood barbeque. Bill from down the block slips on your deck and suffers serious injuries. Your homeowners policy liability coverage pays out $250,000. That’s great, but his total medical expenses, plus lost wages, create a grand total of $450,000. How will you come up with the additional $200,000?

This is where a personal umbrella policy comes into play. It’s designed to extend your liability coverage beyond your auto and homeowners policies. In a case like Bill’s, or if you encounter a similar situation with a car accident, your personal umbrella will cover you. Once you reach the limit of your standard policy, the umbrella coverage kicks in. This additional policy can make a huge impact when you face a large liability claim.

Million-dollar claims

Personal umbrella policies are typically available in million-dollar increments, and most personal umbrella policies cover between $2 million and $5 million. While this amount may seem high, keep in mind that 13% of personal injury liability awards and settlements total $1 million or more. With today’s higher health care costs and hefty litigation awards, one incident can become very costly.

Umbrella policies are helpful for those with considerable assets as well as for those without much money in the bank. If you have few savings, an umbrella policy will provide the much-needed funds to cover a large liability cost. If you’re wealthy, opportunists may be more likely to file lawsuits, knowing you have the funds to pay their settlement. With this extra coverage in place, both groups are fully protected; your savings and assets won’t be at risk if you have an umbrella policy in place.

Contact your insurance pro, who can help you determine how much additional coverage you may need.