Interested in home insurance hacks to save money? Our top ten tips and tricks can save you money today.

Everyone has unique home insurance needs, but while insurance needs vary, one thing that stays constant is the desire to save money. So whether you have multiple rental properties, or simply want to cut down on your monthly spending, there are lots of ways to save. That is why we have put together a list of ten cheap home insurance hacks to help you to get the best home insurance deal!

Shop Around 

As of 2022, there are over 490 homeowners insurance companies from which to choose. You do not have to get a quote from all 490 companies when shopping for your policy, but it pays to get a quote from the leading companies in your area.

Policy Bundling 

If you currently hold multiple insurance policies – for example, auto and pet insurance, it can pay to bundle your homeowners plan with the same provider. Not all insurance providers offer each type of insurance, but the more plans you can bundle, the more you can save.

Improve Home Security Features

A safer home means less risk for home insurance companies, so the more security features you install, the bigger the discount you can receive. The most significant discounts come from installing CO2 detectors, smoke detectors, sprinklers, and home alarm systems.

Skip Monthly and Pay Annually

Paying your policy in monthly installments usually results in an installment fee. Paying for your plan for a year eliminates that fee and gives you an upfront payment discount. 

Stick with the Same Insurance Provider

Company loyalty gets rewarded. The longer you stay with your insurance provider, the more leverage you have to request a discounted rate. 

Improve Your Credit

Having a low credit score means that companies see you as more likely to miss payments on your policy. Before you apply for a home insurance policy, know your credit score. If you have a poor credit score, work on paying off debt and build your credit score back up to reduce your rate. 

Don’t Over-Cover Your Home

Know the homeowner’s insurance coverage limits you need to insure the necessities and to meet any requirements by your mortgage company. Buy the coverage you need and don’t over-cover your home, or your premiums will be higher than necessary. 

If You Are House Shopping, Know The Area 

Where your house is situated significantly impacts your homeowner insurance rate. For example, living in an area with high crime rates means higher insurance premiums because it is riskier to insure your home. 

Install An Automatic Shutoff

One of the most common claims on homeowners insurance is for flood damage. Installing an automatic shutoff helps mitigate the chance of flood damage by cutting off the water when it senses moisture. Less chance of water damage claims means lower insurance premiums. 

Do Not File For The Little Things

Your homeowner insurance exists to cover expenses for damage to home property should certain events occur. Each time you file a claim on your insurance, there is a good chance your insurance premium will increase. Keep your policy premiums from going up by paying for the small things yourself instead of going through insurance.

Home Insurance Hacks to Save Today!

Buying home insurance does not have to cost a small fortune, but with the right hacks, you can save big without skimping on coverage!

I vividly remember the first time I saw Rocky as a kid.  Just a lowly local fighter, Rocky Balboa had to go through so much to get ready for his big fight with the champ Apollo.  After watching the iconic training scenes of him running up the steps of the Philadelphia Museum of Art, punching giant slabs of meat until his hands bled and doing those grueling one handed pushups, I was so pumped to try to be like him.

So the obvious next step for me was to start running up stairs and punch things day and night.  I would be the best boxer this world has ever seen. After 2 or 3 days of this rigorous training, I slowly fell back into my normal routine and completely forgot about becoming the best boxer in the world.

But I didn’t just forget.  I simply lost my initial burst of motivation.  That little spark that got me off of my couch was great for those first few days. But there was no structure or foundation behind it so it quickly fizzled out.

If I seriously wanted to become a real boxer, I would have done found a coach and schedule boxing sessions at a gym regularly throughout the week.  Since a strong training foundation was never built, my initial burst of motivation was destined to fail.

Motivation is Finite

This same phenomena can be found in the world of personal finance.  We’ll watch an intense movie about stock picking or read an inspiring post about someone who paid off massive amounts of debt.  This will get our juices flowing and we’ll just go out there and do some things for a short while. But it will usually fizzle out in the end.

Relying solely on motivation is not the way to get ahead financially.  In fact, I would say that getting motivated and failing over and over will simply get you so depressed about your financial situation that you might just give up on improving.

But it can get better.  And the way it can is by having a framework or system in place that will keep you financially secure without having to constantly draw from your finite well of motivation.

It’s important to realize that this is THE ONLY way to get ahead financially.  Whether you’re looking to build the next billion dollar company, want to increase your investment contributions or just track your finances, you need a system that will make it easy to reach your goal.

And there are so many financial goals out there.  Setting up a budget, saving for retirement or college, starting a successful freelance business, getting a world class education to increase your income.  These are all worthy financial goals that require a systematic approach in order to find success.

Just Get Started

As mentioned before, setting up a systematic method of attack is the best way to achieve your financial goals.  And it’s not even that hard. It just takes a few upfront steps and some experimenting to get your system right.

In fact, setting up systems is much easier than relying on brute force motivation to achieve your financial goals.  It gives you a path to follow and you just plug along day after day.

Here are some basic systems everyone should have for various aspects of their financial life.  These are easy for almost everyone to implement so give them a try if you haven’t already:

Automatic Bill Pay:  We all have the same bills to pay.  Electricity, water, rent/mortgage, tuition, daycare etc.  Keeping all of these bills in order and remembering to pay them off month after month can be a chore.  Having a stack of papers and writing checks and mailing letters is not a difficult task, but it takes up precious time.  You increase your chance of missing a payment this way which can incur fees and possibly ruin your credit.

Instead, take some time out to set up automatic bill pay.  Most companies allow this by entering your checking account info on their website.  If they don’t have that capability, almost all checking accounts have an online bill pay feature which allows you to send a check to any address at no cost.  

Set these up to occur at regular intervals and you will never have to worry about keeping your routine monthly bills in order.

Saving and Investing:  Whether it’s investing for retirement or starting a rainy day fund, most people’s strategy is to just throw whatever they have leftover at the end of the month towards savings.  And considering that more than 75% of Americans are living paycheck to paycheck, this is not going to amount to much.

A much more effective way to save is to have a certain amount of money deducted from your checking account into your investment or savings accounts at regular intervals.  This allows you to grow money at a constant rate and will create a sort of “scarcity mentality” that will not allow you to spend money you don’t have.

This can be done a number of ways.  Almost all employers will automatically deduct 401(k) contributions before your check even hits your account, so that one’s pretty easy.  But if you have your own personal investment or savings account you are in charge of, you can easily set up a direct deposit from your checking account at any interval you choose.

Personally, this systematic approach to saving and investing has had a major impact in my life.  I know myself, and I would never consistently put money into my investment accounts if I had to do it manually.  Automatic investing is so easy to set up and is such a game changer I would recommend it to every single person.

Even if you can only start with $20 per month to contribute to your savings account on a regular basis, I would still recommend it.  It’s better to start somewhere than not begin at all. You can always increase your contributions later.

Tracking your Spending:  Gone are the days of balancing your checkbook to make sure you have the right amount of money in your checking account.  You can do almost everything personal finance related online nowadays, and tracking what you spend is certainly no exception.

Instead, I recommend leveraging the power of technology to set up a system to track your spending.There are so many websites and apps out there that allow you to track what’s coming in and what’s going out.  All you have to basically do is connect your accounts (checking, savings, credit card etc.) to the website and they will usually display your transactions on a nice little dashboard. You can then see exactly where your money is going.

I personally prefer Personal Capital.  You can not only track your spending, income and debt accounts, but it gives you a nice detailed look at your investment accounts as well.  You can see in which sectors you may need to invest more in and if you’re paying too much in fees. It’s pretty much a one stop shop for your finances and they are always improving their product.

Investing in Yourself:  While no one is going to directly pay you to do some yoga, investing in yourself is essential to being financially successful.  Self investment can come in so many forms such as exercise, taking classes, reading and meditation.  You have to find the areas that are important to you and your finances and work on them consistently.

Again, you can use technology to set up systems towards your self improvement.  And it doesn’t take much. You can simply set reminders on your calendar when you want to do some reading or exercise.  Or you can block out a certain time of the day to perform your self improvement tasks.

It’s especially important to set up systems for this.  Self improvement tasks fall under the “Non-Urgent but Important” group of tasks.  This makes it easy to justify taking care of the latest “emergency” before you get to your self investment time.  Don’t fall into this trap that and make investing in yourself a priority by setting up a solid and executable plan of action.

Conclusion

I would argue that not setting up systems for your finances is the true reason people don’t reach their goals.  Most people rely solely on willpower and motivation to try to make their situation better, but that really is a limited resource.  

Setting up systems of action is how giants like Oprah, Steve Jobs and Kobe Bryant became wildly successful.  They found a system that worked for them and kept at it until they got what they want.

The vast majority of Americans are living a paycheck to paycheck life because they don’t know where their money is going and they are not saving or investing enough.  These two huge problems can be solved by setting up systems that make personal finance as easy as a late round Rocky comeback.

So I’m self employed now. I made the change about 6 months ago and am winding down from being an employed optometrist. Working for the man can become tiring.

But one thing working for the man did provide was health insurance at an affordable price. Now that I’m not employed full time, we had to fend for ourselves in the glorious US healthcare system.

Most large companies provide some sort of subsidized health insurance for their employees. You sign up for the plan, and the premium is taken out of your paycheck. Employers will usually foot half the premium while you pay the rest. Not a bad deal AT ALL!

In my case, it was a 50/50 split. I paid about $630 per month and my employer paid $630. The plan was a pretty decent HSA eligible plan so it worked well for us.

Once I left the company, I had 3 options:

-Stay on the current health plan aka COBRA

-Find a plan on the marketplace

-Sign up for some other “alternative” types of insurance such as preferred risk plan and health sharing plans.

The marketplace plans were much too expensive and we didn’t qualify for the health sharing plans since you have to be Christian to join them. And I don’t think they accept fresh converts.

So we decided to go with COBRA. And it has been an experience to say the least. Let me first give you an overview of COBRA insurance.

Premium times two

COBRA stands for Consolidated Omnibus Budget Reconciliation Act. Definitely not as scary sounding as the acronym. It’s a federal law that allows for health benefits to continue for someone who has experienced a job loss or other major life changes.

In my case, by signing up for COBRA we could continue on our current insurance plan without any interruption. Sounds pretty easy right? It is, but it comes with a price.

When I was employed full time, I paid $630 a month and my employer paid $630 a month to cover the monthly premium. But on COBRA, I have to pay the entire $1,260 premium on my own.

The law says I can be charged up to 102% of the premium, which I certainly was. Along with dental insurance which I paid very little for with my employer, my grand total came out to be about $1,400 per month.

The sort of good thing is, I knew this going in and factored it into my decision when becoming self employed. But going from $630 a month to $1,400 a month for health insurance is still taking some getting used to.

So while it was nice to continue my health plan and maintain all the deductibles I had already met, the monthly premium was not so nice.

Silver Linings

Health insurance is an issue for the self employed no doubt about that. Any entrepreneur will tell you that. But its not all bad.

While I do have to pay for health insurance directly from my checking account, the premiums will be an above the line tax deduction. This is pretty much the same as having a pre-tax deduction being employed, so it’s not really an advantage. But it’s nice to know I’ll be getting similar tax savings.

Being able to continue my coverage with COBRA also allowed us to keep our deductibles. We had kind of a busy healthcare year early on so we already met our deductible before I left the job. So it’s nice to have a few months of no more deductible to worry about.

Especially since there is another baby on the way! That’s right, number 3 is around the corner so it’s imperative that we keep those deductibles met for all the hospital bills.

So while health insurance can be a drag for the self employed, there are options. And you need to compare and see what the best option is for you and your family.

Even if it is a snake bite from a COBRA. Which I hope is a covered treatment!

Did you make a New Years resolution for 2019? Most likely it has failed by now. Not that I know you personally or anything. But research tells me so.

It’s estimated that 80% of New Year’s resolutions fail. When they fail can vary, but I would guess around February sounds right since it’s tough for most people to do anything new for a month. Myself included.

Most resolutions are usually health or money related. Not surprisingly, I will focus on how to meet money resolutions. Although health and money are related in many ways.

In any case, here is why I think most money resolutions fail and how we can make resolutions that stick.

SMRT. I mean SMART

Most of us know what SMART goals are. It refers to goals that are Specific, Measurable, Attainable, Realistic and Timely. We’ve all seen this acronym many times.

But as with most things money, knowledge isn’t everything. Execution is where people go wrong. Setting SMART goals is the key but I feel most people just gloss over it or aren’t specific enough.

A big reason why most people don’t adhere to the SMART goal philosophy is that their goals really aren’t attainable. An example is someone who makes a goal to earn $100,000 in 2019. While it’s better than a general goal of “make more money”, this goal still has some flaws.

If this person is used to making $50,000 a year, getting to $100,000 a year is going to be tough. You could break it up even further and say the goal is to make $8,333.33 a month. But if the first few months don’t go right, which is likely since the beginning is always the toughest, then they might abandon the goal.

So what’s the best way to use SMART goals for the New Year? You should still make them specific, measurable and have a timeline. But you need to make the first step ridiculously easy.

Momentum is the key

Let’s say someone made a goal to save 20% of their income in 2019. A worthy goal indeed. But if they are currently saving 5%, it will be pretty tough to crank up the savings rate by 15% and not feel shell shocked.

Make the first step easy. Save 1% more for January. That’s it. It sounds stupidly simple but this is where the battle will be won. By the end of January, they will be saving 6%. Do 1% more for February, and repeat until the end of the year.

The momentum will likely carry this person to their goal. Maybe one month they can save 2%. But June is a tough month and they can’t save any extra. There will be ups and downs but by working on finding ways to save just a little more each month this person will get a crash course in being financially savvy.

After the year is up, they might by at a 16% savings rate. Didn’t quite get to 20%. So is the goal a failure? Absolutely not! Because you can do the same process for the following year and easily get to a 25% savings rate.

All from the first initial easy 1% savings increase. Momentum is a real thing and putting too much pressure on yourself too quickly greatly decreases the chance of hitting your financial resolution

The Big Picture

As humans, we tend to overestimate what we can accomplish in a year. But we also greatly underestimate what we can accomplish in 5 years.

This is essentially the problem with goal setting. We set our sights too high to achieve a short term win. But if we take smaller steps and are okay with stretching our timeline just a little bit, momentum will help carry us to our goals.

Let’s not make February the month where goals come to die for The Broke Professional readers. Just recalibrate them and keep on moving forward.

Some personal finance concepts will live on forever. Pay Yourself First is one of them. Debt Snowball is another one. And of course from uncle Dave Ramsey himself, “Live like no one else so you can live like no one else.”

But the one I want to talk about today is the Latte Factor. It’s a term that has been in the personal finance lexicon for over a decade now, but it is still somehow a polarizing subject.

David Bach first officially introduced the Latte Factor in his book The Automatic Millionaire. This was actually the first personal finance book I ever read and sparked my interest in the subject. A really good book for people at any stage in their finances.

In the book he talked about the ability to give up spending money on something and redirecting that money into savings. The example he gave was of giving up your daily latte. Thus, the Latte Factor.

The numbers are actually pretty amazing. Say you spend $4 every day on a delicious latte. (I worked at Starbucks for years so I know there are many people who do this.) Now instead of spending $4 every day on a drink, take that money and put it into an investment account.

Here’s what happens. If you put that daily $4 into a retirement account that gives you a modest 6% return, you will have $1,547.60 in one year. Not bad at all!

But if you keep doing it, the numbers get crazy. After 5 years, you’ll have $8,723.97. 10 years? $20,398.60. How about we jump to 40 years? How about you have $239,509.62! Just from giving up your little $4 addiction, you can rack up thousands of dollars pretty fast.

So why do so many people have a problem with the Latte Factor?

Overly Sensitive Coffee Lovers

Like I mentioned before, I worked at Starbucks during high school and college. It was at a new store in the mall and from the day it opened, it was packed every day. To say Americans are addicted to coffee is an understatement.

I would see the same people come in day after day for an expensive coffee and a pastry. This would easily be $7 a day. And this was 15 years ago. Starbucks is more expensive and this country is more addicted to sugary coffee and snacks.

So there certainly is a large part of the population that spends close to $10 a day at expensive coffee houses. (By the way, a daily $10 habit can turn into almost $600,000 after 40 years at a 6% growth rate).

And after reading criticisms about the Latte Factor, most people just seem to be mad at the idea of taking away their lattes. They say if you enjoy your lattes and they make you happy, keep them! Don’t let some cold financial guru tell you to stop your habit.

These people are not looking at the big picture. It’s not just lattes that are a candidate for the chopping block (which they should be since most lattes have unholy amounts of sugar). It’s anything you buy that isn’t essential and doesn’t bring you happiness.

Let’s make a list: cigarettes, alcohol, donuts, expensive cell phone plans, expensive car loans, fancy groceries, fancy shaving cream, movie theater food, airplane food, soda, bank fees, non-library books, barely used gym memberships, and so on.

Long enough list for you? Most people have many little expenses like this. Imagine cutting just half of them out and putting it towards your investment plan? I hate the saying, but you’d definitely be living your best life!

Conclusion

If drinking an over-caffeinated beverage spiked with sugar every day really makes you happy, don’t let David Bach or anyone else say you can’t have it. Just realize that you love lattes and high blood sugar more than money and continue to feed the addiction.

But try to look outside yourself and find out what non essential expenses you can cut or minimize. Once you can do this, funnel that savings right into your investment accounts and watch your wealth grow year after year with the additional latte flavored rocket fuel.

And with today’s technology, it’s easier than ever. When you pass by the coffee shop and have the urge to scarf down that overpriced scone, just pull out your smartphone.

Simply sign into your investment account, transfer that $5 from your checking account, and walk away with a smile knowing you are fueling your wealth and some billionaire CEO.