Automobile insurance. We spend thousands of dollars on it then hope we’ll never need it. By law and common sense we know that we must have it. But that doesn’t mean we should pay one dollar more for auto insurance than necessary.

SHOP AROUND. Rates between insurance companies can vary greatly. Call three different companies today and you’re bound to get three different quotes. There is nothing righteous about staying with the same company forever. An hour of your time once a year could net a handsome premium reduction. You can get quotes online from companies that sell directly, like Geico, State Farm and  21st Century. Compare with what you have and don’t be afraid to make a switch.

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INCREASE DEDUCTIBLES. Remember this: The lower the deductible the higher the premium. You’re not likely to file a claim for a minor incident because that could make your premiums skyrocket. So if you’re not going to file small claims, think about increasing your deductibles to say $500 even $1,000. Then put the premium savings in a special account to pay for the fender-benders. One Florida couple that raised the deductible for their 2005 Volvo and 2003 Acura Legend from $500 to $1,000 cut their annual premium from $3,200 to $2,800–a decrease of 12 percent. That is significant. But they need to squirrel away those savings. If the worst happens they don’t want to feel compelled to use a credit card to cover the deductible. Read more