We’re supposedly in a new era of financial sobriety. Yet the evidence suggests otherwise.
Personally, I find this article very scary because at some point someone (unfortunately, it will probably be the responsible) will have to help save the irresponsible.
Need to save money? Here’s a few quick ways anyone can do so…
- Get rid of your insanely expensive wireless plan and switch to something reasonable
- Get rid of cable TV – there are way better things to do than watch the idiot box
- Get rid of all the extra toys (kid and grown-up ones)
- Get rid of the gas guzzler
Read the full article here
What are the 7 traps?
- Mental Accounting – Treating some money as more special than other money based on subjective criteria, such as how it will be spent or where it came from.
- The “Anchoring” Effect – Estimating the value of something based on irrelevant information (e.g., the “anchor”), such as the price you paid for it, the cost of something else you own, or what someone told you it was worth.
- Present Bias – Difficulty postponing immediate returns, or delaying gratification.
- Status Quo Bias – Preferring things you know over the things you don’t know, even if other options are superior.
- Restraint Bias – Overestimating our ability to resist temptation.
- Ownership Effect – Placing a higher value on the things you own, because you own them.
- Familiarity Bias – Gravitating toward products and investments that you know over unknown options, which may be better.
While some of them may be pretty similar I’m sure we all have a tendency to fall into one of the traps from time to time. For me, it’s probably “Restraint Bias” – especially once I’ve gotten an idea in my head that I want something. How about you? What’s your biggest trap?
Read the full post here
We recently received our auto insurance bill in the mail, and for once I decided to “just see” how much of a difference it could make going with a different company. At over $2k for the year (keep in mind MI is a no-fault state) I was hoping to knock a couple hundred bucks off. I started off as I would imagine anyone would do these days and took right to the internet. First stop… State Farm. After entering the data they wanted I waited eagerly and… more expensive. I almost stopped figuring “everyone is going to be the same”.
Still something pushed me onward even with children who needed things wining in the background. Next up I hit Progressive. This time I got a little encouragement with a quote around $700 every six months. I played around with the numbers and got it down to around $550 every six. We were talking some serious cash now. How could roughly the same benefit cost nearly 1/2 what I was paying??
Figuring it didn’t hurt to keep looking I decided to also give Geico a try. This time I was shocked to get a quote even lower! After looking over the numbers I chose to actually increase some of the limits and still kept it around $550 every 6 months.
In the end I chose Geico because for the same rate as Progressive I got more coverage, and still wound up paying nearly 1/2 what I was with AAA. When calling in to setup the coverage I was told that the primary discount was for an excellent credit rating, so for anyone reading this, make sure you’re paying your bills on time, in-full every month.
For those who want a breakdown of the actual coverage numbers, here they are…
|Property Damage Liability (PD)
|Limited property Damage Liability
|Property Protection (PP)
|Uninsured Motorist BI
||$500 comp/$1k collission broad form
||$500 broad form
The moral of the story? Go check your auto insurance coverage and rates then go comparison shopping. No guarantees you’ll see the savings I did, but it just may save you hundreds if not thousands of dollars a year.