Money Crashers » Insurance

How To Deal With A Claims Adjuster When You Disagree On Price or Scope

Erik Folgate — Thu, 15 Oct 2009 02:29:44 +0000

A reader sent this question to us about a water damage claim she is dealing with that occurred in her home. I was a claims adjuster for three years, and I definitely know that adjusters and insurance companies love to pay the least amount possible for a claim, and they try to get away with as much as possible, hoping that the homeowner won’t push back or question their decisions. It’s the job of the insurance company and the claims adjuster to “indemnify” you, which means they have the responsibility to put you and your home back to its original condition. Here is the question from the reader:

My water heater busted and flooded my kitchen, living room, and den. I had a restoration company come out and remove the water and dry the area. The water only got 1 to 2 inches in the kitchen, but my cabinet warped a little due to the water. The insurance company only wants to repair the side of one cabinet and paint the bottom cabinet. They only want to replace carpet in the den and living room. I cannot match up my carpet with the correct carpet. The adjuster told me to get estimates, so I got several estimates. Later I contacted him and he stated that they were not the correct estimates and he could not understand them. Then he told me to call this Service Master and they gave me an estimate for $3,500. They stated that the cabinets did not need to be replaced however, I have had several contractors tell me that they do need to be replaced. My adjuster sent me a check for $2,500 and I got an estimate for $9,700. I was thinking about hiring an attorney or a public adjuster. Please help me. This is my first home, and I am a single 25 year old female. I think my adjuster is trying to take advantage of me.

This is a common situation, but it can easily be settled without the use of an attorney or a public adjuster. If you hire an attorney or a public adjuster, they will take anywhere from 20 to 40% of the claim settlement. Of course, they’ll guarantee that they get you so much money that it’ll pay for their commission, but they cannot really guarantee that, and it’s not ethical in the first place.

The insurance company sent you money, which is a great thing. This means that they agree with you that the claim is covered under the policy. So, the only difference you have is on price and scope. You disagree on how much the claim is worth, and you disagree with how and what should be replaced and repaired (scope of the loss). Scope and price can be negotiated with the claims adjuster, but you must put time and effort into it, and you must be persistent while maintaining a professional demeanor. As long as the claims adjuster didn’t get you to sign a release of liability form, then the check you received means nothing. All it means is that $3,500 is the “undisputed amount”, meaning that you and the adjuster both agree that the claim is worth AT LEAST $3,500. You can deposit that check without it being an admission of liability. But never sign anything saying that you agree that the $3,500 is the final settlement.

As far as the cabinets, you’ll probably need to concede thiis point. Cabinets can easily be repaired without requiring them to be fully replaced. Any good cabinet repairman can put your cabinets back to their original condition. Regarding the carpet, this is the area where you can negotiate with them. If the carpet runs continuous from the living room and den to other parts of the house without a break in the carpet, then the insurance company owes to replace all of the continuous areas. They cannot expect you to accept a “patch job” on carpet. Tell them that this isn’t indemnifying you. That word will get their attention that you know what you’re talking about.

The point is that you can negotiate the claim yoursef and continue to get competing bids. If they continue to be stubborn, then threaten to file a complaint with the state financial department. They will then give you the option of going to an “appraisal” which is a dispute of price and scope with a neutral mediator. This mediator often sides with the policy holder as long as you have legitimate reasons for your dispute.

I hope that answers your question! Anyone else want to weigh in on this? Related Posts:

How To Deal With A Claims Adjuster When You Disagree On Price or Scope is a post from: Money Crashers

How I Pay $85 A Month For My Health Insurance Policy

Erik Folgate — Thu, 10 Sep 2009 04:52:33 +0000

Health care is the big topic around the country right now. Politicians want to push a reform bill that many Americans don’t want. Americans want affordable health care, but they are weary about handing it over to the government. In high school and college, I never worried about health care. I was always under my mother’s health insurance policy, so I never worried about it. Then when I got married, my first “real” job paid for 80% of my health care premium, and the rest of it plus the premium for my wife to be added on was taken out of my paycheck every two weeks. I still paid around $240 a month for it, even with 80% of my premium being paid, so I know that health care policies can be very expensive.

When we moved to Orlando for my wife’s job, I was forced to quit my job, and it was very expensive for her to add me on her health insurance policy. So, I started shopping around and looking at my options. I knew about high-deductible plans with an HSA account, because I had researched them to write about on this blog, but I never had one in the past. Once I started getting quotes, I was really liking what I was hearing. In the past 9 months, I have relied on temp work, freelancing, and part-time positions to make an income. I don’t have a full-time job with benefits from an employer offering to pay for my health care plan.

The High Deductible Health Care Plan

For $85 a month, I have a full health care insurance policy with Assurant Health that pays 100% of my medical costs after I satisfy the $5,000 deductible. A $5,000 deductible for one person? That’s insane, right? Not for a young, healthy male that rarely needs medical attention. Plus, I have an endorsement attached to the policy for emergency medical care that waives the deductible if I break my leg or cut my finger off. Yes, $5,000 out-of-pocket is a lot of money, but it’s not much more when you factor in the cost of co-pay health care.

HMO/PPO health care plans

These plans are crap, and I would never have one unless my employer was paying for my premium. You’ll pay anywhere from $250 to $500 a month, plus you’ll be nickel and dimed by co-pays and many procedures only pay out 80% of the cost, and you are stuck the other 20 percent. Let’s say someone paid $400 a month for a health care premium, and they spent $250 in co-pays over the year. They would spend over $5,000 for health care that year, and that $4,800 in premium is gone no matter what. There’s a possibility that they would have spent less money paying cash if they were only paying for routine doctor’s visits and medication. I spend $1,020 a year in premium down the drain, and I run the risk of paying out an extra $5,000 if I need a large medical procedure or expensive medication, but I only incur that cost if it happens. The $5,000 from an HMO premium is down the drain no matter what.

The Health Savings Account

Additionally, I contribute $50 every two weeks to a Health Savings Account that has many advantages, and I can use this money towards any qualified medical expenses, including my deductible.

Tax Incentives: I am able to deduct up to $3,000 of HSA contributions from my 2009 taxable income. Also, money withdrawn from the account is tax-free and the interest it gains is tax-free.

The Money Never Goes Anywhere: Cafeteria Plans or Flexible Spending Accounts allow you to stash away pre-tax dollars for medical, dental, and vision expenses, but the money is taken from you if you don’t use it at the end of the year. When you contribute to an HSA, that money is always yours, and it always rolls over to the next calendar year if you don’t use it.

Debit Card: I have a debit card attached to my HSA account, so I can pay for doctor’s visits, prescriptins, over-the-counter medication, and other medical items when needed, and the debit card makes it very convenient. I would be very ticked off with it if I had to pay for something, fill out a form, fax it, and get reimbursed. That’s SO 20th century.

You Can Invest The Money: I have mine in a money market account that probably earns about .5% interest, but once you build up a good chunk of cash, you can start investing it in mutual funds with the broker that is affiliated with the bank that handles your account.

The Politics

I know the strong political debate behind health care, a single payer system, and the millions of Americans that don’t have health care. Please do not get the impression that I am saying that what works for me should work for everyone. Yes, I am a healthy, young male, so I received an ultra-premium rate, I understand that. But, I also know that many of the middle-class Americans that don’t have health care either choose not to pay for it, don’t want to take the time to do the research about affordable health care options, or they just don’t know much about high-deductible plans with HSA accounts. This is a great alternative for some people, so please check it out if you are in a similar situation as me. Related Posts:

How I Pay $85 A Month For My Health Insurance Policy is a post from: Money Crashers

Why Rich People Go Broke

Erik Folgate — Thu, 20 Aug 2009 03:56:30 +0000

I was reading Sports Illustrated, and I came across this statistic:

78% of former NFL players go bankrupt or are under major money stress due to joblessness within 2 years after retirement. 60% of NBA players are broke within 5 years after retirement.

Does that surprise you? It didn’t surprise me that a lot professional athletes end up squandering their wealth after they retire, but this number really caught my attention. How can it be that almost 4 out of 5 NFL players bo bankrupt? I think there are several reasons for this:

Lack of Financial Education. NFL players go to a rookie orientation for one weekend before they start their career in the NFL, and they touch on money management for about an hour, and that’s all they get for the rest of their career. It’s not the job of the NFL to teach grown men how to handle money, but the overall lack of personal finance education in America is severely deficit. Think about it, you’ve got a young man who was eating Ramen noodles one day, and now he’s getting $200,000 paychecks every other week. It’s not much different from winning the lottery, except you have to go to work every day and destroy your body.
Materialism. They get caught up in having the finer things in life, which is perfectly fine, but when the paychecks are reduced after retirement, it’s tougher to maintain the same standard of living. Athletes are not adjusting their lifestyle for the reduction in income.
Lack of Investment. Professional athletes are obviously not investing in long-term assets such as growth stock mutual funds and real estate. If you want your money to outlive you, you must invest it in assets with long-term growth potential and a track record for strong growth.
Lack of Planning. Setting up a long-term financial plan is essential to maintain your wealth. Wealthy people need to spend the money to surround themselves with a good attorney, accountant, and insurance professionals to help them with proper estate, tax, and insurance planning. One large medical expense or tax bill can significantly reduce one’s wealth.

It was sad to read about athletes squandering their wealth, but how can you feel sorry for them? At some point, we must take personal responsibility for our actions, and that is why you should not blame anyone but yourself when it comes to your current personal financial situation. Take charge of your situation. Get out of debt, and create a plan to build wealth!

Related Posts:

Why Rich People Go Broke is a post from: Money Crashers

Reduce Your Financial Risk During This Recession

Erik Folgate — Thu, 26 Feb 2009 14:03:41 +0000

The best thing you can do for you and your family during this economic recession is reduce the risk in your life. This is not the time to be taking uncalculated risks with your money, your career, or your future. Here are three ways you can reduce the financial risk in your life today:

Eliminate As Much Debt As Possible: Put together a plan to start reducing your personal debt. There are many different strategies to reduce your debt. If you have a bunch of debts with similar balances, then start paying off the one with the highest interest rate first. If you have a bunch of debts with a large range of balances, then start paying off the smaller ones first to get them out of the way. Read my plan to get out of debt here.

Make sure you are properly insured: This applies to your homeowner’s, auto, life, and health insurance. Your home should be insured up to the cost it would take to replace it if it burned to the ground. Your contents should be insured at 50 to 75% of the value of your home. For auto insurance, make sure you have at least 100,000/300,000/100,000 auto liability limits on your policy. Carrying any limits less than that severely increases the chances of getting sued for causing bodily injury and/or property damage and not having enough coverage to pay for the damages. If you have kids, a spouse, parents, or other family members that depend on your income, you should carry about 8 to 10 times your income of level term life insurance. This is an adequate amount for them to invest and live off of the interest on a monthly basis. Regarding health insurance, make sure you have enough money in your emergency fund to cover deductibles co-pays, and any other shared expenses you may have to incur if you have an emergency health issue. A catastrophic event during these times can and will bankrupt you if you are not properly insured.

Increase Your Emergency Fund: Most financial planners advise saving a 3 to 6 month emergency fund, but in this economic climate, I think you should save AT least 6 months of expenses in an emergency fund. This has been on my mind a lot lately, and I am going to talk to my wife about increasing our emergency fund, because no job is stable right now, and we now have a house to protect.

America is resilient, and we will push out of this economic slump, but we need to face reality and react to the current economic conditions. Play your cards safe right now. I know that everyone is saying, “how, take chances right now, this is the time when people get rich!”. No, people with money get richer right now, because they can afford to take chances. Many of them still lose a lot of money, but it does not put them under. If you are an everyday citizen without a lot of money to take a chance on an investment, play your cards safe until the economy stabilizes. Related Posts:

Reduce Your Financial Risk During This Recession is a post from: Money Crashers

How To Save Money When Buying Life Insurance

Erik Folgate — Tue, 13 Jan 2009 04:40:19 +0000

Like many other products and services offering lower prices due to harsh economic conditions, consider buying term life insurance this year. The rates on term life insurance are lower than ever. A male, non-smoker at the age of 40 can expect to pay $400 or less per year for $500,000 in coverage.

At Money Crashers, we only recommend term life insurance over permanent life insurance such as whole life and universal life insurance for these reasons:

We do not believe that you should mesh your investments with your insurance policy.
The premiums and fees you will pay for whole life and universal life are three to four times higher than term life policies.
Life insurance agents make more commission if they sell whole life and universal life insurance products, and this clouds their judgment when determining whether permanent insurance is a better fit for you. Believe me, it’s never a better fit. It’s a rip-off.
If you are elderly and you do not have any dependents anymore, then you don’t need life insurance. Use the premium you would have paid to a permanent life policy and invest it in something conservative if you are worried about burdening your spouse with funeral costs.
When you pay the premium for a permanent life policy, the first 12 to 24 months of premium go straight towards paying fees, and then a portion of the premium builds up cash value. If you die during the policy period, your beneficiary receives the death benefit, but the cash value of the account disappears, which means the life insurance company absorbs it. Nice, huh?

So, now that I have convinced you to shop for a term policy, consider these ways to save money on a term policy:

If you have a condition such as hypertension, high cholesterol, or diabetes, check with your doctor first to receive clearance from him or her that the condition is under control. Don’t let a condition like that show up on the medical exam without an explanation about active treatment.
Watch your weight. Life insurance premiums will increase if their calculations believe you are overweight.
Drive carefully. Life insurance policies might pull your motor vehicle report to see how many moving violations you have. If they think you are a speed demon, they’ll raise your premium rate, because you are a higher risk to get into a life-threatening car accident.
Don’t work in a dangerous career field. This is one you can’t help. Don’t change your career just to get better life insurance premiums, but it will affect them if you work in an industry more prone to injury such as construction work or operating heavy machinery.
Do well on your medical exam. Many life insurance companies want you to take a medical exam before they insure you to make sure you don’t have a medical red flag. Try to fast for 24 hours before the exam and stay away from poisons such as caffeine and alcohol. Also, stay away from fatty and salty foods like McDonald’s the week prior to the exam.

Life insurance is essential for individuals and couples with dependents such as children, stay-at-home spouses, and elderly parents that you care for. Term insurance gives you the best bang for your buck, and it’s easy to understand. Consider purchasing it this year and follow the tips above to make sure you don’t get ripped off.

How To Protect You and Your Family From Financial Ruin In A Recession

Erik Folgate — Fri, 05 Dec 2008 16:31:09 +0000

The media is saying we’re in a recession, because they love to strike fears in the hearts of Americans. We tune into news programs more when bad news has struck. Think about how many news programs, newspapers, and magazines you consumed during the 9/11 attacks. We love bad news. This is why the media was calling the economic downturn a recession from the beginning. Recession sounds so much darker and desolate than a “down economy” sounds. Call it what you want, but you still need to wake up every day, put your clothes on the same way, and make a living. There are three phases that all families should go through with their finances, and they are:

Protection
Accumulation
Distribution

Protection means protecting your family, yourself, and your finances. In a down economy, you must first think about protection. We often jump to phase two which is accumulation. We want to invest money before we want to protect it. This is a big mistake, because one catastrophic event in your life will drastically change your financial health. Consider these three things to protect you and your family from financial disaster.

Insurance

Get this straight: we buy insurance to protect us from disaster, not life’s little expenses. So many people get frustrated with insurance companies when they won’t pay for every little thing. Insurance companies should be much less nit-picky about their coverage, but that is a topic for another time. The fact is that we buy auto, health, property, and life insurance for life’s catastrophic disaster that could cause us to go bankrupt. An auto accident with multiple injuries and totaled cars, a health accident or unexpected disease, death, and/or a natural disaster are events that will ruin your personal finances. Insurance companies will pull through for the most part on catastrophic events. I know we all hear horror stories around insurance companies not paying this and not paying that, but the fact is that they are scared NOT to pay the big claims, because enough bad faith lawsuits could cause them to go bankrupt.

Auto Insurance: make sure you have high levels of liability coverage and collision coverage on a newer car.
Homeowner’s Insurance: Make sure your house is insured to replacement value, which is the cost it would take the rebuild the house in the event of a fire, hurricane, or earthquake.
Health Insurance: Make sure you have it. We all talk about how many Americans don’t have health insurance, but it’s not all because they can’t afford it. Many Americans CHOOSE not to carry health coverage. If you want to self-insure yourself, I would recommend having a net worth in excess of a million dollars. My recommendation for those self-employed or employers don’t offer coverage who are healthy is to get a high-deductible health plan with a health savings account attached to it. You can gradually save money in the HSA, and have 100% coverage for accidents and surgeries after you meet the deductible. I was just quoted $84.00 a month for a high-deductible plan that pays 100% of my costs after the deductible with a rider for emergency room visits that does not require a deductible.
Life Insurance: Buy it when you have someone depending on your income such as a stay-at-home spouse and/or children. Buy a level term life insurance policy for either 20 or 30 years. Buy 8 to 10 times your current income. So, if you make $50k a year, then buy a $500k term policy. Once the term expires, it will be much too expensive to renew the term, but by then, you should be planning to have a large nest egg to self-insure your death.

Eliminate Debt

Eliminating Debt is one of the best and easiest ways to protect yourself from financial ruin. Read my debt elimination plan series to learn about a proven plan to help you eliminate your debt. When you get the debt out of your life, you reduce your revolving payments, free up more of your income, and reduce the risk in your life. It’s the best way to protect yourself in a bad economy!

Increase Your Emergency Fund

If you don’t have an emergency fund, then start one. If you have one, then beef it up. A starter emergency fund should have at least $1,000 to $2,000 in it. A fully funded emergency fund should have 3 to 6 months worth of fixed expenses in it. So, in a down economy beef up that emergency fund to 6 to 8 months of expenses, just in case you or your spouse loses a job or have a tragic life event.

Will we get through the hard economic times? Yes! Is it possible to find a job right now? Yes! It all depends on you. Don’t depend on the government to help you, depend on yourself with the support of your family and your god to help you achieve your goals. Related Posts:

How To Protect You and Your Family From Financial Ruin In A Recession is a post from: Money Crashers

Are You Paying Too Much For Life Insurance?

Erik Folgate — Wed, 03 Sep 2008 04:56:01 +0000

For those of you who have life insurance, and for those of you who are looking to buy life insurance for the first time, here is a fair warning from your faithful Money Crasher’s host. It’s easy to get ripped off, just like every other insurance product on the market. The problem with life insurance, is that the actual product differs, and each one yields a different commission amount for the agent selling it to you. There are only so many ways to slice auto, homeowner’s, and health insurance. Agents can up-sell you on them by offering bonus coverages for extra premium, but the product is essentially the same. Life insurance does not work this way. Allow me to explain:

Term Life Insurance

This is the kind of life insurance you want to buy. Buy a level term of 10, 15, 20, or 25 years. This is the most basic life insurance product, and it is the cheapest and most effective. For instance, you buy a $500,000 policy for 20 years, and you pay an annual premium each year to keep the coverage. if you die in that time period, the beneficiary is paid out the policy limit. If you don’t die in that time period, you can either buy another term policy or stop paying the premium and you receive nothing. It’s that simple, and for a young individual in good health, you’ll pay less than $600 a year for a ton of coverage.

Whole Life and Universal Life Insurance

This is the crap I’m talking about that life insurance agents and bad financial advisors will try to sell you, because it helps pay for their BMW parked out in front of the office. Whole Life and Universal life offer a life insurance policy with an investment product attached to it. It’s term insurance with an investment account attached to it. These are sometimes referred to as “cash value” life insurance products, because the policy actually carries a cash value. You pay a premium, and some of it goes towards the life insurance product, and another portion of it goes toward the investment account. The cash value of your life insurance grows over time, sort of like a retirement account. The only problem is that it’s a HORRIBLE investment product. I don’t care what the agent tells you about the performance of their product over the last few years. The fees associated with these products is outrageous, and they will eat away at the money you put into it. I would never put my retirement money into a cash value life insurance policy, because it’s not designed to be a retirement fund, even though agents and advisors will sell it and package it that way.

Who Should Buy Life Insurance?

Anyone with children under 18 still living in the house
Any couple that owns a house together
Any married couple where one spouse stays at home with the kids and one brings in the sole income to the household.

I would advise elderly couples with older children to consider saving their money from the premiums they would pay for term insurance. Obviously, the older you get and the more your health deteriorates, the more you’ll pay in premium with it’s a term policy or a whole life policy. You would be better off putting the money you would pay in premium, into an investment account such as a balanced mutual fund or an index fund.

How Much Coverage Should You Buy?

The rule of thumb is to buy 8 to 10 times your household income. So, if you’re family brings in $50,000 a year, then you should buy about $400,000 to $500,000 worth of coverage for a 20 to 25 year term.

Buying life insurance is essential to a sound financial plan. You must take care of the worst case scenario in your life, and there is no worse case than dying. No one wants to think about death in their younger years, but as the saying goes, “the only certainty in life is death and taxes”. Meet with an agent that you can trust and ask about their term life policies. You owe it to your family to protect them in case of a tragedy.

5 Steps To Prepare For A Natural Disaster

Erik Folgate — Wed, 13 Aug 2008 03:12:26 +0000

The Iowa floods, the California wildfires, the earthquakes and typhoons in Asia, and the hurricanes in Florida and the Gulf make us cringe thinking about them. Mother nature is a powerful beast. She does not discriminate, and she does not give warning. We can all relate to going through a natural disaster or know someone who had to go through it. Unfortunately, there are those that do no prepare for the worst. An essential part of being financially secure is planning for the worst. The emergency fund is part of this plan, and taking steps to financially protect yourself from natural disasters is also part of that plan. Here are five steps to help you prepare for a natural disaster.

Buy flood insurance. We all remember the images of Hurricane Katrina and the Iowa floods. A flood disaster will destroy your home, and homeowner’s insurance NEVER covers it. Protect your home further with flood insurance purchased from the federal government. You can pick up the maximum coverage for $300 to $600 per year in moderate risk areas. Go to Flood Smart to find a local agent to purchase a policy.
Inventory your personal property. If you need to file an insurance claim for your personal property, documentation is crucial to receive the full amount of the value of your stuff. Take photographs of everything worth over $50 in value and create a list. Store the photos or video on a disk with the list and put it in a fire-proof safe or store them online.
Keep a large emergency fund. Some states place a larger deductible on claims involving natural disasters such as hurricanes and earthquakes. Make sure you have enough money in your emergency fund to cover your deductible along with additional living expenses. Insurers will pay for additional living expense, but they require you to incur the expense first, and then they reimburse you. Make sure you keep all receipts for temporary housing, eating out, and any other additional costs for being away from your home if you need to vacate during repairs.
Upgrade your home. Stronger windows, stronger roof tie-down straps, reinforced footers, and many other upgrades can be performed on your home to strengthen it when it faces a natural disaster. Many insurers give credits to your premium for making these upgrades, because they know that it will reduce the overall damage to your home during a disaster.
Get your home re-appraised. As a claims adjuster, I’ve seen so many houses burn half way to the ground only to find that they were under-insured. The scenario is common. You buy an insurance policy ten years ago for $150,000, but the cost of construction has gone up considerably, but the agent failed to increase the coverage each year. Now, that $150,000 house costs $225,000 to reconstruct. Speak to your agent about applying an inflation guard to your policy that increases your coverage amount by 3 to 5% each year. Also, get a professional replacement value appraisal to accurately assess the replacement value of your home. Remember, you DO NOT need to consider land value for the coverage amount on your policy.

Look, I know you don’t want to think about disaster striking you and your family, but it happens and you will be pissed off when you find out how ill-prepared you were for it. Do it for you and for your family.

Selling Your Life To a Stranger Is Creepy

Erik Folgate — Fri, 11 Jul 2008 03:55:06 +0000

Check out this article on MSNBC about a guy who sold his life insurance policy to an investor for a lump sum of $125,000.

Is it just me, or does this creep you out a little bit? Knowing that someone will profit from me dying doesn’t sit well with me. I would be looking over my back and sleeping with one eye open for the rest of my life.

What do you think? Would you sell your life insurance policy for a quick $100 grand? Related Posts:

Selling Your Life To a Stranger Is Creepy is a post from: Money Crashers

31 Ways to Be Frugal And Save Money

Erik Folgate — Wed, 02 Apr 2008 02:03:06 +0000

Lately, I’ve been hearing tips from friends about how they save money, reading articles about saving money, and trying to come up with ways to save some money around the house. So, I decided to put together a comprehensive list of ways that we save money around the house and in our daily lives. There are 31 suggestions, one for each day of the month.

Buy and install a programmable thermostat. Set the thermostat higher when you are gone during the day and cooler when you are at home at night.
Use Coupons wisely. Only clip coupons for items that you consume on a regular basis.
Cancel the ID theft protection on your credit cards. You don’t need it. If you didn’t pay for it, you’re not liable for it.
Negotiate lower interest rates on your credit cards. It’s worth a shot, and some credit card companies might do it if you’ve been a faithful customer or you threaten to balance transfer to another card.

Buy a texting plan for your cell phone.

Plan out your dinners for the week. My wife and I always get trapped into going out to eat when we are stumped on what to cook for dinner.
Prepare you lunch at night. If you’re like me, you typically don’t have much time in the morning to make lunch, so do it at night and put it in the refrigerator. It will help you to stop eating out for lunch so much.
Try Out Red Box for renting movies. If you typically rent new release movies and you have a Mcdonald’s near you with a Red Box vending machine, give it a try. It’s a $1 per night for a decent selection of new movies.
Dump the gym membership. If you want to never work out again, buy a gym membership. I don’t know what it is, but whenever I’ve had a gym membership, I’ve worked out less. You can jog, ride a bike, do push ups, pull ups, sit-ups, and various other exercises without ever stepping foot in a gym. This could save you up to $50 a person, per month.
Replace the windows in your house. If you have an old house, you probably have a ton of air escaping through your old windows. The initial cost will be a good chunk of cash, but it will be worth it from years of energy savings to come.
Increase your insurance deductibles. Build up an emergency fund and increase your auto and homeowner insurance premiums to $1,000. You’ll save hundreds per year in premium.
Wash your car yourself. I now hate car wash places, because their sprayers chipped a piece of paint on our car. There was already a tiny chip there, so I couldn’t really argue with them about it. You car deserves personal attention. Don’t spend $10 for a machine that can’t get dirt in areas you can.
Have your spouse cut your hair. Guys, if you keep your hair short, buy hair clippers with a set of clips and hand over the clippers to your spouse. You may have a couple of cuts that result in a buzzed head, but unless she’s got horribly unsteady nerves, she’ll figure it out.
Wear your clothes more than once before washing or dry-cleaning. I wear jeans, khakis, and dress shirts at least 2 or 3 times before I wash them. They key with dress shirts is wearing an undershirt. Some of you may think it’s gross, but your clothes will not fade as quickly and you’ll spend less on detergent and dry-cleaning bills.
Change your own oil. This is so easy whether your a guy or a girl. It’ll typically cost you $10 to change it, and you won’t have to wait at the mechanic for a few hours.
Share a meal when you’re out to eat. Have you seen the portions that chain restaurants are serving up lately? There’s no secret why our society is so overweight. You’ll save your heart and your wallet by sharing a meal with your significant other. If you’re one of those people that feels bad doing it, make yourself feel better by tipping 25% to the server.
Eat before you go to the movies. We all know that movie theaters make their money on their price-gouged food. Eat a filling meal before the movies, and it will help you pass by the concession stand.
Avoid extended warranties. These are like pure profit for retailers, that’s why they push them so much. Best Buy and others will try scare tactics to get you to buy one, but don’t fall for it.
Transfer your banking business to a free checking account. Washington Mutual Compass Bank, and many others offer completely free checking accounts. There’s no reason you should be paying maintenance and annual fees for a checking account.
Buy electronics and computer peripherals online. Tigerdirect.com, Buy.com, NewEgg.com, and many others are always running deals for computer accessories and other electronics. Also, check out my favorite deal aggregator, Ben’s Bargains.
Check craigslist for used furniture, used cars, and used electronics. You can find steals on lightly-used stuff at your local Craiglist.
Buy clothes at consignment boutiques. Consignments such as Plato’s Closet are becoming really popular. They offer barely used, premium brand clothing for a fraction of the retail price. My wife has found great pairs of jeans, skirts, and tops at Plato’s.
Get creative with your recreational activities. Go to the park, the beach, hike in the mountains, ride a bike, attend a festival or play a sport. Entertainment doesn’t always equal spending money.
Buy motion-sensored exterior lights. It’s better than keeping your exterior lights on all night.
Don’t play the lottery. You’ve got a better chance at getting struck by lightning.
Quit Smoking. (I know, easier said than done) A pack a day at $4 per pack is $100 a month.
Become a handyman or handywoman. Buy a book on minor repairs and have fun teaching yourself to do minor house repairs. Although, you might want to stay away from messing with plumbing and electrical if you aren’t gifted with being handy.
Give the gift of time. For Christmas, birthdays, and anniversaries, schedule quality time with a spouse, best friend, family member, or child. It’s more memorable and more special.
Travel on off-peak times. Every vacation spot has a different peak time for travel to that destination, so research when their off-peak time is and you’ll save hundreds, maybe even thousands on your trip.
Avoid gimmicky insurances like pet insurance, travel insurance, accident insurance (AFLAC), and rental car insurance. Add the rental car collision endorsement to your auto policy for about $6 to $10 per 6 months.
Stick to a written budget. You know my thoughts about this. Stick to it, and you’ll feel like you gave yourself an instant raise.

I hope these suggestions inspire you to immediately start saving money around your house and in your life. Start documenting how much money each change saved you, and you’ll have a lot of fun seeing how much money you’re saving. Take the challenge, and start becoming a frugal Money Crasher.