Personal Finance Blog

 
 

What are is the difference between comprehensive and collision coverage?

Understanding the difference between comprehensive and collision coverage insurance is one of the most important aspects of auto insurance that is often overlooked by drivers. While neither of these coverages is a requirement in some states, they are often required in the case of a newly purchased or leased vehicle, largely because in those cases, the bank which holds the title to that vehicle wants to ensure that their investment in your transportation is covered. On the other hand, a vehicle purchased outright may not necessarily need either coverage, depending on your willingness to risk the total loss of the car in the event of an accident. Additionally, vehicles purchased for cash on the secondary market may not need this type of coverage. Rather, state minimums (check in your local area to be certain) may be limited to carrying only liability and property damage coverage.

Comprehensive car insurance coverage is a universal coverage that insures your car against pretty much anything that collision coverage doesn’t cover. It is the insurance which will pay for damages incurred through such things as vandalism, fire, and theft. While comprehensive car insurance coverage is by its very nature, all-inclusive, there are limitations that will be clearly delineated within your coverage documents. For instance, comprehensive coverage rarely covers incidents termed “Acts of God.” It does insure against weather mishaps, though, such as hail. In some cases, comprehensive insurance coverage might cover the contents of a vehicle, but may not cover damage to aftermarket accessories. Usually, a car insurance company will only pay to have a vehicle restored to its original condition, not necessarily the condition it was in at the time of the fire, vandalism, or theft. In these respects, it is very important to be aware of what coverage you have.

Collision coverage is the auto insurance component which pays for damages stemming from an accident that happened on the road. Traditional accidents, damage from loose debris on the roadway, or even damage from the roadway itself is usually covered by the collision coverage on your auto insurance policy. What collision coverage might not cover is damage incurred in a private parking lot while the car is parked, even if another vehicle is involved. Collision coverage pays for damages to or replacement of your vehicle that you more traditionally consider an accident.

While in some states, collision and comprehensive coverage aren’t necessarily required, they are a good idea for anyone who can’t afford to replace their vehicle outright in the case of an accident. If the value of the vehicle is less than how much you pay in one year for the insurance premiums, then you might consider at least scaling back on either or both of these coverage options, because if the car is totaled, you’re going to only receive fair market value for it, less your deductible. For instance, let’s say you’ve got a $500 deductible, a $2,000 car at fair market value, and pay $120 per month for car insurance (typical of a younger driver). In an accident, the settlement is going to be $1,500 for a total loss, but you will have paid out $1,440 in insurance premiums. You’ll only see $60 for the car’s value, when you might have saved the $1,500 to use toward the down payment of a newer car. Whether to carry either of these coverages on an older car is strictly a matter of your own personal comfort level with how you are insured, and the laws in your area to which you must adhere, but it is important to note that it may not be financially wise to be paying for a benefit that you’ll never see.

Knowing your personal insurance plan’s coverage is an important aspect of being an informed consumer, and in this, you’ll be armed with the knowledge you need to have in order to make the best decision possible.


Posted in:  Insurance
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Tips for Improving the Fuel Economy of your Ford Mustang

The Ford Mustang GT, in any year, is a gas hog, regardless of what Ford has done to tune the engine. Improving gas mileage in your Ford Mustang might be a bit tough, but it could be worth it in the long run, depending on how you drive. Fact is, even the V6 engine in the non-GT Mustang can’t really beat the fuel economy of one of Ford’s smaller economy cars. So, how do you improve gas mileage in your Ford Mustang, either V6 or GT? The answer is simple, and yet so, so complicated.

While improving efficiency (power) in your Ford Mustang will improve gas mileage here and there, the most significant way to improve gas mileage has more to do with regular servicing of the vehicle than aftermarket parts. This approach to improving gas mileage includes just two steps, and can easily improve gas mileage in your Ford Mustang as much as 10% over what you’re currently getting. The answer is tire pressure and oil. Unless you fill your tires with Nitrogen, which has a larger molecular structure than air, you’re going to experience some loss of tire pressure as you drive, so keeping tabs on your air pressure will definitely improve gas mileage. Keep the air pressure at what the rating on your tire says, not necessarily what the door says. The reason for this? When the Mustang leaves the factory, that specification is correct, as the tires match the VIN number of the car. After those tires wear out, though, and you replace them, factory-replacement tires may not be available. If you chose sportier tires, they might have a higher pressure rating than the factory-replacement tires did.

It’s been proven that by using non-conventional motor oil (read: synthetic,) you don’t actually have to change your oil on the typical industry accepted 3,000 miles, three months schedule. In fact, you could get away with changing your oil just twice per year using high-grade motor oil and a premium oil filter. These are designed to last longer and provide better filtering than you’d find in filters and oils available in say… the 1950′s, when the 3,000mile/3month system was introduced. Sixty years makes a big difference. Don’t skip your oil change, though. To Improve gas mileage in your Ford Mustang, you’ll have to stick to the regular service intervals for all wear parts, and changing your oil regularly with the correct weight of oil, using a fuel system cleanser in your Ford Mustang fuel tank at the same time, and at least occasionally running high-test fuel (four times per year is enough to help clean the injectors.) will increase gas mileage by at least 5%, depending on your driving habits.

Power adders are the parts that hot rodders just love to toss to their cars. They’re expensive, don’t always work as well as the manufacturers claim that they do, and it just might take a pro to install it for you, but used judiciously, they can provide not only explosive power for your Mustang, but also (again, judiciously used,) a considerable way to improve gas mileage. One warning, however: The parts here listed are addictive- hot rodders know, there’s no such thing as “too fast.” The intake and exhaust systems are most typically changed, but to get the most bang for your buck, go with a supercharger system coupled with a intercooler or a methanol-injection system. If you can keep your foot out of the throttle, you’ll see spectacular fuel economy gains, since it takes less gas to get the car up to speed.

 

Realistically speaking, if you’re realizing 15 miles per gallon in your Mustang in the city, and 20 on the highway, the tips here (with all other factors being equal), could improve gas mileage up to five miles per gallon in the city and a little more on the highway, but keep in mind that the actual economy you get has more to do with how you drive than the performance parts you bolt on.


Posted in:  cars
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The Ultimate Christmas Gift? How About a Homemade Christmas Basket?

Christmas is for many families a time of stress, anxiety, and overspending. Unfortunately, it just isn’t that easy these days to get into the Christmas spirit without worrying about all the extraneous stuff that comes along with it. While it is the most festive time of year, there’s a lot to be said for that cooling-off period between Christmas and New Years, when you don’t have to go to work yet, everyone who has to go back home has gone back home, and what’s left after the cleanup is a fresh outlook on a brand new year. What’s wrong with making that the feeling du jour all during the holidays, though? From Thanksgiving to February, why not ensure everyone’s in a good mood? You might be surprised just how simple it can be if you take the time to stop, take a breath, and appreciate what Christmas is really all about!

Gift baskets were once a lot more common than they are today. In our cellophane-wrapped world, there isn’t much room or time for anything but gift cards. That’s unfortunate, since Christmas is one of the best times of the year to let our loved ones know how we really feel about them. They can make the holiday a little easier on you and at the same time, spread out a little joy while you’re at it. Homemade Christmas gift baskets can fill the need for a quick, fun Christmas gift or an imaginative alternative to gift cards. All you need is a little imagination to get started.

The Movie lover’s Christmas gift basket. A Christmas gift basket with this theme will be great for anyone who just can’t live without movies. Start with a DVD or BLU-Ray disc, or build the Christmas gift basket around a picture of the recipient’s favorite actor or actress. You’ll find knockoff autographed photos on Ebay, or check out magazines that cater to the autograph collector for authentic autographs. Prices for the autographed pictures can range anywhere from about $15 for new, relatively unknown, or Indie actors and actresses up to around $300 for authentic big-name stars. After you have these items, what’s a movie without popcorn? Toss in several bags of movie-style microwave popcorn and some movie-theater style candy, too. You can also drop in a couple of gift certificates to your local theater, or gift certificates to your local video store.

For the man in your life, gift giving can be a touchy subject. Trust me, ladies, it doesn’t require that much thought! Guys wear their desires on their sleeve, and you don’t need to dig too deep to find a gift that will have plenty of meaning. Giving a man a Christmas gift basket doesn’t have to be taboo, either. Include in the basket a magazine subscription you think he might enjoy, and then use your imagination. Is he a hunter? There are thousands of gifts available at your local outdoors store that will fit perfectly. If he’s into cars, throw in a small die-cast car, an issue of Hot Rod Magazine, and some things such as car wash soap, some small tools, a tire pressure gauge, and fuzzy dice.

Christmas gift baskets for those who love to cook couldn’t come any easier if they had to! Put into your Christmas gift basket a new cookbook, some kitchen utensils, and specialty food products that they’ll enjoy. A bottle of fancy imported Olive oil or white truffle oil won’t set you back more than about $12, or you could provide them with some Flame roasted peppers, specialty salad dressings, or imported foods that you’ll find in your local high-end grocery store. The choices are endless!

Keep in mind that Christmas doesn’t have to be difficult to be fun. Rather than concentrating on getting someone the latest gadget or go-to toy, be creative and enjoy the search! You’ll have fun, and save money, as well!


Posted in:  Budget & Savings, Uncategorized
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