Making Insurance Work With Your Finances

by Pam on March 31, 2016

I think all of us know about the temptation to skip on insurance. So many of us are trying to save as much money as we can. Insurance sometimes just seems like an annoying extra expense, one that doesn’t really do anything for you. It can also be quite a complex business. There’s not just one kind of car insurance or life insurance. There’s different price tiers, different considerations and conditions to select, etc.

But if you don’t have insurance, then you could be putting yourself and your finances at severe risk. What’s more is that there are several forms of insurance that are forced upon you. How can you make insurance needs comply with your budgeting?

Car insurance

Of course, there are several forms of insurance that the law requires to have. If you drive a car, then you need to have car insurance. We wouldn’t recommend skipping on car insurance – not unless you want to be arrested! Car insurance is one of the things you need to factor in when you’re budgeting for a new car. In fact, it’s one of the reasons I would recommend skipping the use of a car altogether if you really want to save money over the long-term.

What if you definitely need a car but are looking at high insurance costs due to your record? Then you’ll want to research what to do in your particular scenario. Otherwise, look into cheaper insurance plans that can cover several members of your household instead of just you. Not having insurance could just damage your finances further if something unexpected occurs.

Health insurance

Health insurance is a bit more complicated. If’ you’re in the United States, you find find that health insurance is mandatory. How this works is, admittedly, a little strange. For the most part, it’s pretty fair and won’t bother your finances too much. If health insurance would cost more than 8% of your household income then you’re not required to purchase it. You’re also exempt if your income is too low to require you to file taxes.

Oddly enough, these rules mean that many high-earners may also be exempt from mandatory health care. If you earn too much to qualify for discounts on the insurance, then it may cost you more than 8% of your income. If you earn less, you may be struck by mandatory payments. If you’re having trouble affording it, you can seek help from government programs.

Life insurance

This one makes a lot of people uncomfortable. That’s not the only reason people skip it, though. Sometimes, it’s just too difficult to get life insurance that fits your particular needs. If you have a lot of people and assets to protect, then you need a commensurate policy. Claybrooke 100k cover can assist you if you need a hefty amount.

As for those with with less on their plate, it can be tempting to skip it entirely. Life insurance isn’t really mandatory anywhere in the world. If you don’t have any dependents but have plenty of savings, you might be okay. But if your financial situation is less secure then, paradoxically, life insurance becomes more vital. If your family doesn’t have a comfortable enough income, you will need to make some room for life insurance coverage. Otherwise, your dependents could be at bigger financial risk if something terrible happens.

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