Beating Broke

Personal Finance from the Broke Perspective

When Do You Need Umbrella Insurance?

By Leave a Comment

You likely have the insurance you’re required to get, such as auto and home insurance, and you probably have health insurance, and hopefully life insurance.  For many, that’s enough insurance to adequately protect you and your assets.  However, in some cases, you may also want to consider more coverage.  If you’re wondering when do you need umbrella insurance, there are several situation when buying it may be wise.

When Do You Need Umbrella Insurance?

What Is Umbrella Insurance?

Think of umbrella insurance as an extension of the auto and home insurance you already have in place.  If you have an auto policy with a $500,000 cap for injuries sustained, and you have an accident in which several people are severely injured, that $500K may be used in very little time.  When that amount is exhausted, umbrella insurance steps in and covers the rest of the costs, up to the limit of the policy.

When Do You Need Umbrella Insurance?

Likely, most people living low risk lives do not need umbrella insurance.  The basic insurance they have in place will cover them.  However, there are some times when you’d benefit from umbrella insurance.

You Have Significant Assets

If you have assets over $500,000, you may want to consider an umbrella policy.

You Have a Teenage Driver in the Home

When Do You Need Umbrella Insurance?
Photo by Matt Chesin on Unsplash

Teens are inexperienced and can be reckless, increasing your liability.

You Frequently Have Visitors to Your Home

More visitors mean more chances for injuries or accidents to occur.

You Have a Trampoline

Fun, but an accident waiting to happen, especially if you don’t have net fencing around it.

You Have a Rental Home

A rental home can be a great income source, but having one opens you up to lawsuits and expenses, especially if someone is injured or if the house sustains damage in a fire or other weather-related event.

You Have a Pool

Minimize your liability by having a fence around your pool, but still, someone might drown or fall and hurt themselves.

You Have a Dog

You may think your dog is gentle, but it only takes once for a dog to get aggressive and bite someone.

Caveats

There are two important pieces of information, should you be considering purchasing umbrella insurance.

First, your rates on your existing auto and home insurance policies will likely go up.  If you buy your umbrella policy from the same company that you purchase your auto and home insurance, they may first want you to increase your coverage for those policies.  The umbrella pays out only AFTER the auto or home insurance is exhausted, so they want those limits to be high enough, which raises your premiums.

Second, if you are sued in the future and have your auto, home, and umbrella insurance with the same company, the insurer may hire you an excellent lawyer because they want to avoid paying out the money, if they can.

Few people discuss this type of insurance, and most people don’t need it.  However, if you have liabilities in your life, such as a pool where someone may drown or slip on wet tile and hurt themselves, you may want the peace of mind that umbrella insurance offers.

Read More

Does Your Car Insurance Pay for These Items?

When Do You No Longer Need Life Insurance?

4 Insurance Policies That Will Save You Money in the Long Run

How Can You Tithe When You Can’t Pay the Bills?

By Leave a Comment

Most Christians believe that you should tithe, specifically 10% of your income.  While this can be a sacrifice, many Christians are devout in doing this.  But does this rule also apply when you have no money?  Tithing when broke is possible, but you may need to be creative in how you do it.

Tithing When Broke

Start Small

If you’re determined to tithe, start small.  Give what you can.  For years, my husband and I lived in the suburbs of Chicago and made less than $40,000 a year.  We always gave to our church, but we definitely didn’t give 10%.  Now that our income has improved and we’ve moved to a place with a lower cost of living, we have increased how much we give.

There’s nothing wrong with giving what you can and increasing that amount little by little as your financial situation improves.

Tithe Your Sacrifice

We all have areas of our budget where we spend unnecessarily.  Maybe you spend money on a case of beer every month or a Netflix subscription.  Tithing when broke may be in part just a matter of finding those little extravagances in your budget and cut them.  The money from those items becomes money that you tithe.

Find Free Ways to Give Money

There are also free ways you can donate money such as signing up for Amazon Smile.  If you shop through AmazonSmile, .05% of your purchase total goes to the charity of your choosing.  (There are over 1 million charities to choose from!)  I found our church there and signed up.

Likewise, some grocery loyalty cards also have a charitable component.  I signed up for our church through my grocery store’s loyalty card, so a part of every purchase is tithed to my church.

There are other ways you can give for free.  For instance, I signed up for Swagbucks.  I use it sparingly, so I only earn one or two $25 gift cards, but I use those in December to donate a toy to a needy child.  Every year, our church puts up a Christmas tree with gift requests from needy kids.  I always take one and buy something using the free gift cards I’ve earned.

Volunteer

Tithing when Broke
Photo by Anna Earl on Unsplash

If you don’t have any money to give to the church or you can’t give as much as you would like, consider volunteering instead.  There are so many opportunities to volunteer within the church such as serving as an usher or singing in the choir.  The office may need help or you may have specific training such as accounting that you can use when volunteering with the church.

There are also other ways to tithe such as volunteering your time in the community working on houses for Habitat for Humanity or working in a soup kitchen.

Final Thoughts

Tithing is an important part of being a Christian.  However, you may not financially be able to give as much as you would like.  Luckily, there are many others ways to give.  Tithing when broke may require you to give of your time instead or find organizations that give a part of your purchase price to your favorite charity.

Read More

A Two-Step Approach for Preparing Kids for a Giving Holiday

Earning Swagbucks and Saving with Coupons

4 Ways to Make Money for Christmas Presents This Year

Why Buying a Toyota Sienna Was One of Our Best Decisions

By 3 Comments

Almost 16 years ago, my husband and I had one child—a four-month old—and we decided our Toyota Echo was too small for our growing family.  We found a Toyota Sienna and made the leap.  That car was by far our greatest financial commitment at the time as it cost $25K.  (We didn’t own a home then.)  While paying so much back then made us nervous, there are several reasons why buying a Toyota Sienna was one of our best decisions.

Why Buying a Toyota Sienna Was One of Our Best Decisions

The Benefits of a Toyota Sienna

There are so many benefits to this vehicle for our family!

Reliability

When I was young, I owned a Ford Escort.  I only owned it for two years, yet it left me stranded three times because it randomly broke down.  One time it broke down after a high school dance.  I was stranded at midnight when I was just 16!

In all the years we’ve had the Sienna, it has not broken down once.  I’ve never been stranded.  Considering I often drive alone with young children, this is a definite plus!

Sure, it’s needed regular maintenance and repairs, but that is to be expected.  Its reliability can’t be beat, especially when we’re on long family trips like from Chicago to Boston or Chicago to Tucson.

Durability

Why Buying a Toyota Sienna Was One of Our Best Decisions
Photo by Jessica Furtney on Unsplash

Honestly, when we bought our Sienna when our child was four months old, I never, ever thought I would still own that vehicle when the baby we had then was old enough to drive.

However, this vehicle has been so durable!  It’s still going strong even though it has 225,000 miles on it.  Our mechanic says he’s seen some Toyota Siennas that are well maintained last until 300,000 miles.

I have no plans to get rid of this minivan until it costs too much to repair or it dies.  This is much to my children’s chagrin because they find the vehicle embarrassing now.  But my wallet loves it!

Versatility

The Sienna is so versatile.  It’s a comfortable vehicle for our family of five.  However, it can also take the place of a truck or a full-size van when it comes to hauling things.  We’ve been able to buy large pieces of furniture and fit them in this vehicle.  It’s also great when we buy a month’s worth of groceries.

When we used to travel 2,000 miles to visit family, we could easily pack all of our suitcases, two coolers worth of food, and our pets comfortably in the vehicle with us.

Final Thoughts

Sure, our vehicle is old and is starting to wear out.  For instance, our car came with one manual sliding side door and one electronic sliding side door.  The electronic door wore out more than five years ago, and we never fixed it because it would cost too much money.  Thankfully, we still had the manual side door.

Also, the engine isn’t quite as powerful as it used to be.

Despite these minor issues, there are many reasons why buying a Toyota Sienna was one of our best decisions, especially because many vehicles with 225,000 miles aren’t even on the road anymore!

Read More

Is a Car an Asset or a Liability?

Haggling or No Haggling When Buying a Car?

How Much Car Insurance Coverage Do You Need?