Homeowner's insurance is the backbone of our real estate properties. Housing markets are some of the most consistent in the nation, with rock solid investment opportunities all around unlike the volatile stock market. Since many companies are now providing home insurance, it is important to select the right policy without spending a fortune. As with shopping around, you need to conduct some research. Your research should involve striving to keep your premiums and deductibles as low as possible. One way to do this is by not insuring the land your house sits on.
Insuring your land is only grounds for over-insuring. To start, your land is not exposed to thieves, property fires, or other conditions covered by your homeowners insurance policy. When picking the right homeowners insurance, the value of the land should not be taken into consideration. Besides, your land cannot simply disappear. This is the reason why insurance companies don't insure the portion of the home's value that represents the property.
However, this doesn't erase the fact land can disappear altogether. In cases where devastating natural disasters occur like an earthquake or a tsunami, there is another type of insurance involved which is bought separately from a typical homeowners insurance policy which covers these costs. Keep in mind many lenders still try to persuade home buyers to insurance the entire loan amount including land. For instance, if your lender is financing you with a $400,000 mortgage on a $400,000 house, part of that is going towards insuring the land. Always make sure the amount required to build the house in case of danger is the amount insured.
With that being said, what exactly is covered by homeowners insurance? Homeowners insurance covers the costs of replacing your home and the items within in case they get damaged. Along with not insuring the land, another excellent idea is to look around for the best homeowner's insurance quotes. Make sure you shop around and investigate the various insurance companies that are out there. Their quotes will run the gamut, although each lay their basic criteria on the value/age of your home, previous claim history, and crime statistics in your area. It is common knowledge that rates for homeowners insurance don't vary drastically as ratings are based on the same factors. As with any insurance company, make sure to choose one with an excellent track record. In case of a disaster, you don't want a company to disappear. Beware of overly cheap policies as well.
By not insuring the land in homeowners insurance, you can save money that could be spent elsewhere.
As a society, we are used to the convenience of nearly everything. For many, debt begins to spiral out of control because people think their bit of plastic is nothing more than a convenient way to satisfy their gotta-have-it-now attitude. Many fail to have a plan to pay back what they have spent on credit. Instead, they wrong assume that there are spending free money. It isn't until the bills and balances start piling up do they realize what kind of mess they have gotten themselves in to and can not foresee a way to pay it back. Many credit card purchases occur because consumers lack patience to save up the cash. They see the big screen television or the latest model of computer and they have to have it now. They spend freely on credit and fall headfirst into debt. Here are some ways to slow down the impulses and set goals for saving cash for the big ticket items: 1. Make a Plan Once you have zoomed in on something you want to have, start formulation a plan for savings. If the price of the items is $1,000, break that number into payments based on how much you can afford to put away each month. If you can afford $100 every bi-weekly pay, you will have to save for 5 months before you have your goal amount. It may seem like forever, but the more you save and the longer you wait to get your hands on that item, the better off you will be. You will feel like a champion handing over cash instead of your credit card and you will not have to worry about accumulating debt. You also may change your mind about the "have to have" status of the item if you have to wait to get it. Saving cash may help you eliminate unnecessary spending on a lot of impulse buys. 2. Commit to Saving As soon as you know your magic number, commit to tucking away that amount or more each time you get paid. Set up an automatic deduction from your account at regular intervals or register for an account at SmartyPig, where you can set savings goals and allow others to contribute money to your savings plan. If you really want the item you are saving for, nothing should stop you from putting away the money. 3. Do More Work If you have your heart set on something wonderful, it is likely you will find the motivation to put in more hours at work or find a second job to help you save faster. Especially around the holidays, retailers and other places of business are in need of a few good people to supplement their regular staff. If you can not commit to the hours, use your hobbies to earn you extra cash. Mow lawns, shovel snow, sell your crafts - whatever talent you have can turn a profit while you still keep control of your schedule. 4. Make Your Junk Work For You Look around your house for stuff you can sell online or at a yard sale. Commit to putting all monies earned directly into your savings account. This is a beneficial way to rid your life of clutter and turn a profit. 5. Make Sacrifices To save faster, give up some of life's luxuries that you can live without, such as dining out or having cable television for a few months. Depending on your motivation, you may find that the more you give up and the simpler your life becomes, you may discover a whole new way of living frugally. 6. Keep Tabs on the Merchandise As you continue to build up your cash, keep your eye in the item you want to buy. Chances are good that at some point, the item will go on sale or you will find a cheaper price by doing research online or at other stores. In the event you find what you are looking for at a cheaper price, you may be able to afford the item well before the goal date you had originally set for yourself. 7. Do It Again After the exhilaration of setting a financial goal and reaching it, take time to celebrate with a pat on the back - then get ready to do it all over again. Getting into (and staying in) the habit of saving money, will leave your feeling more financially confident and better prepared to handle your money in the future, without relying on credit.
Both Ameen Kamadia & Mary Bush are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.
Ameen Kamadia has sinced written about articles on various topics from Home Buyers Guide, Foreclosure Help and Home. Mr Kamadia, is a mortgage consultant, and real estate broker in Houston Texas. For the 69 other free articles on saving money when you buy a house visit Abby's