How can I budget to reach my car insurance goal?
I want to get off monthly payments and know paying in full is a better deal. How can I set up a budget for this?
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Answered on Apr 21, 2021
Emily Maracle is a car insurance specialist living in New York. Originally from the Pacific Northwest, she has a degree in English Literature and a background in customer service. She enjoys cooking, gardening, and living sustainably. In the future, she can't wait to upgrade to a hybrid or electric car.
“You’re right: most car insurance carriers offer a discount for paying your premium in full.
To budget for this, figure out how many months are left before your policy renews and divide that number by your total policy premium. For example, if your policy renewal is in four months and your renewal price is $800, you’ll need to save an extra $200 every month ($800÷4).
To budget for your future policy terms, do the same thing. For example, if your policy still renews for $800, but your next term is 10 months away, you’ll only need to save an extra $80 every month.
Be aware that carriers do have the right to re-rate your policy at every renewal.Your rate may fluctuate and your savings may be less or more than the final amount you will owe. “
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