Cheap Monthly Car Insurance

Questions and Answers

Your Questions About Cheap Monthly Car Insurance Payments

July 9, 2013

Lisa asks…

What is life like as an adult financially?

When you are through with college and you have a job, a car, and a home, what things do you have to pay for? Insurance, mortgage, bills, tax, etc. What is life like as an adult?

Administrator answers:

It’s a little scary at first, because there’s always something creeping up—and when you first get out of college, you have the least money to deal with it.

But it changes over time, as you make more money and can better predict expenses.

So…
• rent/mortgage
• phone bill
• car insurance and maintenance (tires every 50,000 miles can run $400 or so, plus regular rotations; oil changes, brakes, filters, plugs, etc.—check the maintenance book for your car)
• renter’s/homeowner’s insurance
• probably a credit card bill (if you rack up debt)
• car payments, if you have one
• gas for the car
• grocery bills
• saving for the future (future down payment, vacation, retirement. Start with what you can. Even $50 a month adds up)
• other incidentals (sometimes things like a water bill, garbage collection, homeowner’s due—which are required by law if you are part of an HOA, something a lot of people don’t consider when buying a house)

You do also have to pay taxes and health insurance, but those usually come out of your paycheck before you get it, so you can’t “forget” to factor them in.

Those are just some of the regular bills, though. There’s always something creeping up, like:
• Car repairs
• Medical bills (even with insurance, you have deductables and co-pays)
• Prescriptions, if you have any
• Christmas presents (if you don’t set money aside, it can be a big hit)
• Vacations (which ALWAYS cost more than you expect)
• Entertainment (can’t go to the movies for less than $20)
• Restaurants—really adds up if you eat out a lot
• Clothing
• Hair cuts (can be expensive for women)
• Furniture and other home stuff (if you buy a house—lawn mower, etc.)
• Kitchen stuff (have someone throw you a house-warming party when you move into your first place—pots and pans, flatware, plates, etc.)
• Other on-your-own startup costs (shower curtains and the like add up quickly)
• Home repairs
• HOA dues (if you buy—there are advantages to renting for a while)
• Dating (mostly if you’re the guy—a classy guy, anyway)
• And other incidentals I can’t think of right now (the occasional $162 speeding ticket—not that I know anything about that)

And…dun dun dun… Children. That’s a whole new ball of wax, but I wouldn’t worry about that right now.

It sounds scary, huh? But it’s really not.

A couple general rules: Don’t commit to more than 1/3 of what you make for rent or a mortgage. So if you make $30,000, no more than $10,000 a year ($833/month) on total rent/mortgage payments. (Remember, there are hidden costs in a mortgage, so you can’t just divide the cost of the house by number of weeks.)

That rule alone should keep you from getting in way over your head.

Second, cars. They also have hidden costs—like annual registration. A new car registration can cost $500-600 on top of buying the car. It goes down every year, but when you’ve forgotten you’re going to get a $400 bill, it can hurt.

So even though you might suddenly feel flush at $30,000, buy a cheaper car. Buy a used car. The registration and insurance will be much cheaper, and you’ll be able to save faster for a nicer one later. Then, when you buy a nicer car, you will have more money to put down, and your monthly payments will be less.

Check out Jane Bryant Quinn’s “Making the Most of Your Money.” She gives great advice for each stage of your life—how much to save when, etc.

A couple other notes: If you’re good with Excel spreadsheets, you can create a budget there. Maybe someone can set it up for you (if you’re not good), and it does the math for you so you can keep track of what’s coming in and going out.

Also, I keep a list in my checkbook of all my regular monthly bills, with the months listed out to the right. As they come in and I pay them, I check under the month. That way, I don’t ever look at my bank balance and think, “Wow! I’ve got a lot of money!” only to have a hefty bill come in the next week.

Yeah, sounds scary. But you’ll get the hang of it pretty quickly—just try to be organized, and you’ll stay on top of things. Get a box to keep files, and get a desk. Really, this will help you a lot.

Hope that’s not too much.

@jcurrie—oh yeah. Don’t forget to buy condoms.

Linda asks…

how much of a mortgage can i approximately qualify for with a $4000.00 monthly income?

My husband and I have no debt at this point, our car is paid off, we do not have credit cards. Our credit scores are in the upper 600′s (660-670 range midscore) And we are using a VA loan.

Administrator answers:

You should check into a mortgage pre-approval for a loan to answer your question. You shouldn’t consider a payment of more than 30-35% of your income and while your car is paid off now, that may not the case for the whole 15-30 year term of your mortgage so that should be factored in. A mortgage / housing payment needs to consider property taxes, PMI insurance, water/sewer, and other expenses. Owning a home will eventually be cheaper than renting but not for several years. Your credit score isn’t the best and your interest rate will reflect that. Don’t gamble your future dreams away for immediate satisfaction. Live within your means and always consider increasing income and reducing expenses along the way.

Sandra asks…

Planning a budget… What are all the bills to expect upon moving out and to Orlando, Florida?

I’m planning to move out of my parents house in a few years and figured now is a good time to start saving. Aside from the initial costs (furniture, moving boxes/vans, deposits and first month’s rent etc), what are all the bills to expect and what are their average costs? I’m looking in the Orlando area, but any of the other cities around it are fine if they’re cheaper and still close-by.

I plan on getting either a studio or 1 bedroom apartment, likely on a 2nd or 3rd floor, I’m very conservative with energy, ac/heat and water, and I’m planning for having nothing included just in case. I won’t have a pet at the time, nor do I smoke/drink/gamble. I’ll be driving roughly 40 miles per day on a 28mpg car, so I’m just averaging that out to filling up my 13 gallon tank once a week at $4 per gallon.

So far, I have Electricity, Phone (cell, no home phone), Internet, Cable, Water, Trash, Fuel (for my car), Renter’s Insurance, Car Insurance, Health Insurance, Rent, Food, Toiletries, Gas (heat and stove, if any are gas), and Laundry (if no washer/dryer in apartment).

The estimates I have monthly so far are Electricity: $70-$150, Phone: $2-$50-$62, Internet: $52, Cable: $45-$79, Water: $50, Trash: $25, Fuel: $220, Renter’s Insurance: $16, Car Insurance: $125, Health Insurance: $450, Rent: $500, Food: $170, Toiletries: $50, Gas: $40, Laundry: $17.

What bills/payments am I missing, and do my estimates seem correct? Personal experience from anyone who lived or is living there is much appreciated, but any thoughts/opinions are welcome.

Thank you for reading such a long post and thank you in advance to any answers. If more details are needed, just let me know.
I’ll be attending college and hope to be fully fluent in Spanish by then as bilingual workers are appreciated in almost any career type. I plan on working full-time, so after taxes and including other sources of income, I’ll be taking home roughly $1950 per month.

Hopefully some utilities will be included, gas is generally not used in Florida and I probably won’t have time for cable, so I expect to be paying around $1700 monthly in bills, but even if absolutely nothing is covered I won’t be in the red-zone, though I won’t have as much left over as I’d like. If I’m particularly lucky, my parents may pick up some of the bills (such as leaving me on their health insurance plan, they have much cheaper rates than I would be able to get for myself), but I’m not counting on it.

I should have at least $15,000 in savings by then (halfway there, so far) and plan on using $3,000-$5,000 of that to cover initial expenses (deposits, initial rents, furniture, moving

Administrator answers:

Plan on paying first months rent, last months rent & a security deposit when signing a lease for an apartment.

Laura asks…

Need help figuring out how to reduce my expenses and pay down debt?

My wife and I have an $80K in a line of credit.

We own our home with $50K that we put in as downpayment and probably about $125K in appreciated value (we bought it 4 years ago pre-construction for $300K and it’s probably worth $425K now). I guess we also have the additional capital put into the home by way of our monthly mortgage payments but I imagine most of the payments go toward interest.

So the $50K investment in the home plus the $125K appreciated value = $175K in assets and minus the $80K line of credit makes us about $100K in the positive.

Our problem is that we are running at a loss of about $1K to $2K each month and this loss comes out of the line of credit which is going to continue going up.

My wife and I bring in about $6K or 7K net each month in income.

Our expenditures are around 7K or 8K a month.

So we run at a loss of about $1K to $2K a month.

The breakdown of our $7K or $8K expenditures is as follows: The main expense is our home which costs around $2K a month (based on $1,300 for the mortgage, $400 for condo fees, $600 for property tax). Our case lease is $450 a month. Insurance is $500 a month (life insurance, LTD insurance, car insurance, home insurance). Interest on our line of credit is $300 a month. Entertainment expenses are about $800 a month including dinners, buying electronics and stuff, buying clothing, going to concerts. Groceries are $600 a month. Haircuts are $100 a month. My public transit pass is $175. Internet and TV is $175 a month. Cell phones total $120 a month. We put $150 into an RRSP each month.

My question is what should we do? Cut down certain expenses? Move to a lower cost place as our place is of course the biggest expense?

How could we even reduce our expenses by moving to a cheaper place? We go over $1K to $2K a month and our home expenses including mortgage etc. right now is $2K a month.

And what about this theory – is it a good idea to keep living with the $1K to $2K loss and taking it out of the line of credit rather than move to a cheaper place because the benefit of having a more expensive place for which more money goes into it via mortgage payments and for which we make money off a high appreciated value makes up for the $1K to $2K loss?

Administrator answers:

Move out, give yourself haircuts. And you will slowly enjoy life much more.

George asks…

How can I set up an Excel sheet to manage my finances?

I pay for most things with my credit card and then basically dump all my paychecks towards my card at the end of the month. This used to work out fine but I gradually started spending more without realizing it because with a rolling card balance I never actually see concrete “earned” vs. “spent” numbers. Currently I have a balance of several thousand dollars on my credit card.

I would like to put together a spreadsheet or book of spreadsheets in Microsoft Excel 2010 (which I have already anyway) that can keep track of my finances and help me gradually get out of debt. Eventually I would like to have one of these that incorporates my girlfriend’s finances as well but we are not quite at that point in our relationship yet and I would of course like to erase my debt before we start sharing financial details! :)

The biggest obstacle that I can’t get around is that everything seems to vary from month to month. My pay is fairly consistent as I am paid hourly and consistently have 40 hours per week but I also receive labor surplus bonuses that can vary from $50 all the way to several hundred dollars (these bonuses are ~monthly). Some of my bills are monthly and others like my car insurance I pay once every six months in one large lump sum. Still other bills, like my energy bill varies from $60 up to $180 seasonally based on the temperature outside.

I’m not sure how to organize a spreadsheet around this data and use it as an effective tool towards my future finances. The only thing that I can think to do is record ALL of my bills and spending transactions along with my pay, organize it chronologically by week or month, sum it up, and then just track the HISTORY and hopefully see where there is opportunity for spending cuts and react accordingly.

Any suggestions, tips, resources (pre-made templates, etc.) are appreciated in advance. Thanks much.

Administrator answers:

BEFORE worrying about MS Excel Spreadsheets etc. Here are just a few ” SUGGESTIONS ” to get back on track financially speaking:

1. Take ALL your credit cards ( and put them in the safety deposit box at your local bank ) and DO NOT USE THEM WHATSOEVER – until they are COMPLETELY paid off in full down to zero ( 0 ) .

2. START by paying for ALL your purchases etc. With CASH ONLY ! When you pay with plastic there is NO emotion attached to the purchase – it is too EASY to use plastic and thus why you are in the situation you are in.

3. GO AFTER your CREDIT CARD bills that have the highest % interest rates FIRST and pay those off FIRST.

4. See if you can DECREASE the amount of monies spent on going out to restarants, coffeeshops, bars etc.

5. IF you get any bonuses ( each month ) regardless of the amount – take the WHOLE bonus and put the total BONUS on the CREDIT CARD with the highest % interest rate and get the Credit Card paid off and STOP USING credit cards – USE DEBIT CARD ONLY !!! CASH ONLY !!!

6. AFTER you get rid of the CREDIT CARD and other DEBT – then START saving for EMERGENCY FUND and also short and mid-term goals.

7. Start SMALL and set up a goal like $50 per week for a Used Car fund , $50 a week for a Vacation Fund, $50 a week for Christmas Club fund etc. SMALL amounts on a REGULAR consistent basis achieves your goals.

8. I use the “ENVELOPE SYSTEM “….. When I get paid I sit down and pay all my bills first – putting CASH into each of the envelopes. Then whatever is LEFT over ( if any ) would be extra to pay-down more on to DEBT / or on to savings

Lastly ….. DON’T SPEND any Monies until you have paid your bills FIRST !!! Stay away from Online Websites to make purchases or Wal-Mart or other stores and SACRIFICE until that DEBT is gone for good.

YOU CAN DO IT and all you need is take it one day and one week at a time

REMEMBER there is a difference between an WANT and a NEED in life. Do you REALLY need a NEW CAR or can you buy a USED CAR and save ALOT of monies ???

We paid $5,900 CASH just simply from saving from February 2012 to August 2012 and now we DO NOT have any CAR payments. We bought a 2003 Nissan Altima Car with 60K miles on it and it works great and paying CASH allows you to sleep at night and be stress free.

As for MS Excel Program, it may sound cheap – but I look at it being wise – go to www.microsoft.com/excel and you can always ” download ” a FREE evaluation copy of MS Office which includes Excel Spreadsheet and Microsoft will allow you to ” EVALUATE ” the program for FREE ususally for 30 days. Take advantage of it and go for it.

Also, check out Microsoft Website for FREE templates that you can Import into MS Excel and use and does NOT cost you nothing. Put in the search bar at top Excel Spreadsheet Templates

P.S. Sounds tidious – but it works – keep all your RECEIPTS for three ( 3 ) months – and then you will see where you are ACTUALLY spending your monies ……

P.S.S. Always ask yourself BEFORE you buy something NEW or USED – ” Do I REALLY NEED this item ??? ” OR will it be better for me to use that money to pay down my Credit cards FIRST ???

Short Term Financial Pain for long term SUCCESS and STRESS FREE living !

Good Luck and Success in the future – you can do it !!!

Donna asks…

How does renters insurance work if I am only living somewhere for 3 months?

The apartment complex requires renters insurance. So do I have to buy the coverage for the year or if I do the monthly payment plan do I just pay the 3 months, or is it expecting me to pay the entire thing?

Sorry if this is a stupid question, I’m young & don’t know these things
My choices are: annual at $63, 4 pay plan at $15.75, or an 8 pay plan at $10.08 but I don’t understand because I’ll only be there 3 months

Administrator answers:

It transfers over to wherever you live, after the three months are up.

Renters insurance costs about $100 a year. If you have a car, you will save WELL over $63, by having renters insurance at the same company. Even if you move back home with mom and dad, it’s cheaper to keep the coverage.

Helen asks…

How much per month is valet insurance for a new valet company?

I’ve been wondering this for a while and I’ve read it’s pretty cheap. I valet myself and I’m interested in the idea of owning my own valet team.

Administrator answers:

Whatever source you’ve been reading, is dead wrong.

Plus, you cannot buy business insurance “by the month”. You can’t even get monthly payments on a new businesses insurance, unless you go to a third party financing company and pay outrageous interest rates.

It’s going to depend a lot on where your business operates – both the type of business, and what city it’s in; but you should budget a minimum of $2500 for the “garage liability” that covers the damage to customer’s cars.

John asks…

Inexspensive insurance for a first time under 21 car buyer?

I’m 18, plan on purchasing a car soon. Honestly, which car I purchase is based off my monthly insurance payment. Im young & back in November I recieved my first speeding ticket, I paid it instead of going to court.. Worst choice ever. Anyways, Does anybody know good cheap insurance for a driver like myself?
Below are a list of cars that are on my list..

1. 2004 BMW 745LI
2. 2002-2003 BMW M3
3. 2004-2005 Audi A8L
4. 2007 Jeep Wrangler (4-Door)

Please help. Thanks!

Administrator answers:

Your best option is to compare auto insurance quotes online from multiple insurance companies…

Try a site like: QuoteAgents.com

Lizzie asks…

How do you think the insurance in a 2001 Santa fe be?

I’m 18 and want to buy this. I want to insure it threw my parents because they are 35 and they have been insured for years. My mom drives an 08 Lexus is250 that’s loaded for 300 a month so I assume that this car has to be beyond cheap to drive. If you could get an estimate for me I would like that

Administrator answers:

Huh?

Your mom’s car insurance is $300/mo (which is ridiculously expensive) or your mom’s car payment is $300/mo? That’d mean she put a lot down in cash or trade – monthly payments mean nothing – I can get you a monthly payment of a $1/mo on a Maserati if you put $99,988 down for a $100,000 car.

Cost for your car insurance is mostly about who you are, not what kind of car you have. While the kind of car counts a little bit, it doesn’t count as much as you think. In your case, if you’re a single 18 year old male – that’s as expensive as it gets. The best way to figure out how much it would be – have your parents call their insurance agent and get a quote. You don’t have to actually own the car to get a quote. Again though, it won’t be cheap.

Good luck!

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