That prediction is based on the drivers, age type of car, where they live. Among other things, this prediction works into the cost of insurance for each driver. The insurance company looks at the probability that someone will file a claim, along with the dollar amount of the potential claim. That'S what drives the cost of insurance. Here'S my point. In many cases, cheap insurance is simply insurance with less coverage or insurance that pays less when you file a claim.
Expensive insurance, on the other hand, provides broader coverage and pays more. When you have a claim, the insurance industry is a heavily regulated industry. There are not huge differences in profit between insurance companies http://casinoslots-sa.co.za/neteller. Their pricing has more to do with the coverage offered than the amount of profit the company makes to plan effectively for wrist. Look closely at what is covered in your insurance policy. That'S what you're paying for find an insurance agent who sells coverage for a variety of companies have that individual help you decide on a policy that is right for you, while there's no exact order of priority. This discussion starts with the rest of their most important to cover start with protecting assets. Any expensive asset that you purchase should be insured against damage and theft. Most states require you to have in car insurance, so that's probably an automatic. If you're, renting an apartment or home, you should strongly consider getting renters insurance. This area of insurance is often neglected. Well, you may not own the place that you live. You have valuable contents inside many insurance agents recommend taking pictures room by room of the contents of your dwelling. This may sound extreme, but it's the most effective way to prove what you've lost in the event that your home's contents are damaged or stolen. Consider taking the step when you rent or own your home once you have the assets insured. The next step is medical coverage at a minimum, everybody needs coverage for catastrophic illness. One purpose of medical insurance is to get you healthy, so you can get back to work. If you choose not to have sufficient coverage, you may put off paying for insurance out-of-pocket by delaying getting medical help, you may prolong your illness, which may limit your ability to work. This is another reason to have a discussion with an insurance agent beyond medical insurance. You should consider disability insurance. The purpose of this coverage is to replace a percentage of your income. When you cannot work some people able to get this coverage through work, it can be very expensive to purchase on your own if you're, self-employed you'll need to prove several pastures of income before the insurance company will provide a quote for disability insurance. Finally, consider life insurance life insurance can provide a lump sum that can be in student income from the investment can replace income you earned to care for your spouse or children. Everyone who marries or starts a family should have life insurance. All of this risk management comes with a cost. Your next step is to meet with an insurance agent who can help you with all of these types of insurance, make it a priority to meet with an insurance agent. Once you decide on insurance cover, is the cost of that coverage should be part of your overall financial plan? People can be different when it comes to creating a budget. In fact, you might see these differences between your children or with a brother and sister one person is frugal and plans carefully. The other person says to themselves. I must have money in my account because I haven't run out of checks yet so what is a budget? Exactly a budget is a document that lists your income and plan spending over a period of time. You may already create a monthly budget for yourself, or at least you have a vague idea of your monthly budget in your head. We'Re going to take the idea of a budget one step further: let's work, assets and liabilities into your budgeting process. Financial planning involves accumulating assets and limiting liabilities. So it's important to connect your budget to these two financial concepts. Ultimately, you create a budget to use your available cash wisely to start connecting the dots we first need to determine assets and liabilities. An asset is anything of value. To you, a personal asset is something that you own and use, such as a TV or a car. A business asset is an item that you use to make money in your business. An asset can be short-term or long-term. If you use up an asset in a year or less that's a short-term asset, say that you're a runner and buy new running shoes every four months. That old pair of running shoes may not be an asset once you stop using them for running it's, not the perfect example. You may use your old work shoes to work in the yard, but you get the idea, an asset you plan to use for a year or more as a long-term asset. If you buy a car you're likely to drive it for five years or more. So your car is a long-term asset. You may not separate your personal assets between short term and long term, but it's important to know the difference. If you choose to buy assets, you'll use up cash, even if you borrow funds to purchase an asset. You eventually need to repay the lender with cash for a business owner. There are two assets that tie up available. Cash accounts, receivable and inventory accounts. Receivable represents money. You are owed by clients if you sell on credit you're, creating accounts receivable in your business. Until you collect accounts receivable in cash, you must find other cash to run your business. The same is true of inventory. If you go to the hardware store, for example, the entire inventory on the shelves represents some sort of cash spending. Until that inventory is sold and the cash collected the owner needs another bucket of cash to run the business. Here'S why I bring up accounts, receivable and inventory. If you run a business, you may occasionally have to make cash contributions to fund your business operations. If you contribute personal assets into the business that impacts your personal financial planning, a liability is an obligation. A short-term liability may be your utility bill. We all have bills that are due in 30 days or less. Those are short-term debts. Your car or home loan is a long-term debt. Keep in mind, however, that you may repay some of the original amount borrowed each year. We refer to that original amount borrowed as principal. Your car loan, for example, will likely include the payment of interest on the loan as well of repayment of some of the principal. In fact, your lender is required to disclose the exact payment schedule to you, including how much of each payment is returned in principle. Now that you know how assets and liabilities work mull over your own finances, take a sheet of paper and divide it in half. Listen! The assets on one side and the liabilities on the other, if you have more liabilities than assets, don't worry financial planning is all about increasing assets, while minimizing liabilities. More on that, as we move through the course think about the last time, you planned a vacation. You started with deciding where you wanted to go and then started to figure out the cost to get there. You may have compared the cost to fly with the cost of driving your own car. Once there you needed a place to stay.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. Archives
December 2018
Categories |