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12 Personal Financial Facts That You Didn’t Know You Should Know
May 10, 2017
Your employee benefits package matters! A good workplace benefits package can be worth 20-40% of your basic salary, and include valuable insurance. If your company does not have a solid benefits package you could be making less money than you think. If you don’t understand your benefits package, you may end up needing to supplement it or even doubling up on what you already have.
What is the cost of rebuilding your home? If you own your own home, you will need to have insurance on the building. Often the insurance you have is less than the market value. It's important to know exactly how much insurance your home needs if you had to rebuild. Rather than paying too much for insurance you don’t need or not enough for insurance you need, check your mortgage valuation. This will ensure you have the right amount of insurance in case a disaster strikes.
What does your home contents insurance cover? A standard contents policy will cover your possessions if something happens in your home, but not if it’s lost or stolen . If you want that coverage, you need to opt for additional personal possession insurance.
Know where your receipts are. If you need to make an insurance claim, you have a much better chance of having it settled quickly when you have proof of the purchase. Keep receipts and know where to find them. If you have proof of purchase of important items, it will help you receive the amount of cash you want when you need to replace it.
How much savings will you need if you can’t work. The best case scenario is to have a six-month cushion if you cannot work. However, it’s not necessarily a problem as long as you have something else in place to kick in when you run out of cash. If you are able to retire early or have short term disability, than you do not need a six-month cushion. Some people even get income protection insurance to kick in in case they cannot work due to illness or disability.
Know what day direct debits leave your account. The best way to pay your bills and track your savings and expenses is to set them all up on autopay through your bank. This will help you avoid late fees when paying your monthly bills. However, to avoid being hit overdraft fees when you end up with a shortfall one month, you need to know when your debits will leave your account. This will allow you to take action to move money from a savings account or arrange an overdraft when you fall short in your account.
Know your credit card’s APR. The average credit card rate is 15.07%, but they vary from 0% to more than 50%. If you are paying off your debt, you may want to stay with your credit card company. If not, you need to know your rate when searching for a better deal.
Know what factors affect your credit rating. Six out of 10 of Americans don't understand their credit or what factors will help improve or destroy your credit rating. A poor credit score can make it difficult or even impossible to get a competitive mortgage, loan or credit card. You are entitled to a free credit report every 12 months from each one of the credit reporting agencies Equifax, Experian or TransUnion. You can also use a credit monitoring website to monitor your credit.
Are you financially linked to your ex even after you divorce? Yes! The link will remain indefinitely on your credit report. You can request removal after you closed all joint accounts, mortgages, loans, credit cards and other lines of credit.
Price comparison sites aren't always the cheapest or best way to secure financial products. These sites make it easier to search and compare financial products, but don’t always offer the best option each provider has to offer. Often the comparison companies have a deal with the provider that includes them receiving a cut of the sale which adds to the cost. Once you narrow down your options, get a direct quote from the company.
Know your actual annual mileage. Your auto insurance company wants to know how many miles you drive each year when you purchase coverage. The more miles you drive your vehicle, the more likely you will be in an accident. If you have seriously underestimate your mileage it can invalidate your auto insurance policy if/when you make a claim. Track your mileage to avoid underestimating or overestimating your mileage.
You can reduce your auto insurance cost by adding your partner. Statistics show that drivers who have another named driver on their policy make fewer claims which in turn will reduce the cost of your auto insurance policy.