When you’re approaching your retirement, it’s the perfect time to rethink all of your monthly expenses and make a budget. You’ve worked long and hard for your nest egg of money to be able to enjoy your senior years. So don’t let something like paying too much on your car insurance hinder this time of your life.
Once retired, most people can expect to pay less when you factor in all of the discounts available to retirees and senior citizens. It makes sense that after years of driving experience, you’d be considered low-risk enough to qualify for the lowest rates possible.
Here are some factors you should be aware of as you shop around since they are the areas insurance companies will look when providing you with your new policy:
Our bodies’ response systems naturally slow down as we age
Unfortunately the first factor is a negative one. But it’s something you should be aware of because it could potentially impact your insurance rates. Fortunately, it is the only negative factor on our list and shouldn’t outweigh the potential discounts you should receive.
As we get older, our bodies naturally slow down. Response times and natural reflexes decrease in effectiveness. This could increase a senior citizen’s risk of being in an accident. Insurance companies know this and take it into consideration.
Your experience on the road goes a long way
Moving past the potential increase in rates as mentioned above, many insurance companies offer a slight decrease in rates after the age of 55, similar to the decrease after age 25.
Why is this? Because your many years behind the wheel obviously make you a more experienced and trustworthy driver than young adults. You know what you’re doing.
This is especially true for drivers with very few accidents. A couple here and there through a lifetime of driving are bound to happen and shouldn’t hurt you in your retirement years. If you do have more than a few, and possibly accumulated a fairly negative driving record, this might not apply to you.
Basically, insurance companies will look at patterns in your driving record and take them into consideration, whether those patterns are good or bad.
No more commuting to work equals greater discounts
The next is fairly obvious and should be updated with your insurance company whether you switch companies or not. Insurance companies will decrease rates based on miles driven.
Therefore, if you are no longer driving the dozens of miles (or considerably more in some cases) back and forth to work every day, you have less of a chance of getting in an accident, and will receive lower rates.
Of course, many people retire and choose not to stay home all day, but travel instead. If you do plan to increase your mileage, especially if you plan on getting an RV or boat like some older people choose to, your rates might not go down in these cases. It all depends on what you report to your insurance company as far as your estimated mileage annually.
While we’re on the note of traveling though, if you do obtain a new toy, whether it be a recreational vehicle or watercraft, make sure you bundle your policies for greater discounts.
There are actual retirement discounts available
Finally, the most simple one to consider is the actual retirement discount, usually for new retirees.
Not all insurance companies offer this discount and sometimes it comes with stipulations like age requirements or attending a defensive driving course. But it’s something to be aware of since it could potentially save you more money with one company over another.
After decades in the work force, it’s time to enjoy your retirement. Sifting through policy after policy at dozens of different insurance companies can seem tedious. But if it saves you money in the long run, it can definitely be worth it.