A great way to simplify your personal finances as well as save you some money is to do a little shopping. I am not talking about going to the mall to shop for clothes. I am talking about just picking up the phone to do some comparison shopping.

I recently received my annual renewal for my homeowner’s insurance. Upon reviewing the renewal notice, I was a little shocked at the cost of my renewal. What even shocked me more was the fact that my coverage was not increased. I had been insured with this company the past four years and I never had a claim. So I called my agent to ask why such a large increase in premium. They stated due to recent natural disasters their cost has increased so everyone was seeing a significant increase in their premium. With that said, I decided it was time to do a little shopping just to see if other companies had increased their premiums also. If that was the case I was ok but I wanted to see before I renewed my policy.

I called three different companies to provide me quotes based on my existing coverage. All three companies came back with quotes lower than my new premium. So I decided it was worth my time to review these quotes in more detail as well as review the company as well. I did not want to change insurance providers just to lower my premium but receive less than satisfactory customer service or the insurance company not be there when you need them. After that review I was able to eliminate one of the three companies. This left me with two companies with very similar quotes. However, one company decide to provide me with a quote based on having my car insurance with them as well. When they applied the car insurance it lower the homeowner’s policy even lower and was able to reduce my existing car insurance also. So by combining my home owner’s insurance with my car insurance, I was able to save a little over $800 annually. Not only did I save but I also have more homeowner’s coverage than I had previously.

With a few phone calls and a little research, I started this year off with a $800 savings. Its a great way to start off the new year.

Here are some steps to help you do the same thing but I can not guarantee you will save as much:

1. Question your rate increase?  Ask the reason for the increase.
2. Call other insurance companies for quotes on a similar coverage
3. Perform due diligence on the companies you receive quotes from
4. Ask for quotes on homeowner’s and car insurance you may receive an additional savings.
5. Don’t make decision based solely on price make sure coverage is same or better.  You don’t want to save by having less coverage.

Take Action

When you receive your next renewal notice in the mail, do a little insurance shopping before you send your payment.

Not only did I save some money but I also simplified my finances by consolidating my insurance carrier.

If you would like more tips to help you simplify your personal finances make sure you subscribe to simple financial lifestyle email newsletter and subscribe to RSS feed for blog updates.

How can one number simplify your persona finances?  Yes it is true.  One number can help you simplify your personal finances.  This number will make things easier for you and will help you reduce your financial stress.  This number is not a large number.  You are probably thinking yes one very large number can help me simplify my personal finances.  If you read Would winning the lottery simplify your personal finances?, you will know that I do not believe having a large amount of money will simplify your finances.  Let me stop the suspense and tell you.  The number 1 can help you simplify your finances very easily.  Think about it if you only had:

One checking account and saving account- you will know where all of your money is held.  There is no need to have a spreadsheet to keep track of all of your accounts.  Less mail to receive with only one account.  Less accounts you have to balance at the end of each month.

One bank – you will never have to think which bank account do I need to take the money from.  No need to think about which online bank account I need to log into.  Everything for your finances can done at one location or one login.

One mortgage – if you need two mortgages to purchase your house should you even be purchasing the house.  You can only live in one house at a time so why would you need two.  Just think of the up keep you would have with two homes.

One car per driver – If you are lucky you may be able to have one car for the entire family.  That would save you alot of money.  But that is not always practical.  So stick to one car per driver in the home.  If you have three cars and only two drivers, how often is the extra car driven.  You can save on maintenance  and insurance by getting rid of that extra car.

One cell phone – unless your job requires you to carry a phone for work.  You do not need more than one cell phone.  Eliminate that additional expense.

One investment account – its much easier to keep track of your investments if you only have one account.  You will have a better understanding of your overall asset allocation as well as keeping track of your investment performance.

One credit card – yes having only one credit card came significantly simplify your finances.  It limits your spending and enables you easily track your spending and credit card debt.  Eliminates the need to pay multiple bills each month.

One service provider – if you can consolidate your utilites to only one provider that will eliminate the bills you have to pay.  This is not always possible but can simplify your finances if you can do this.

One advisor – do you really need more than one investment advisor or accountant.  Probably not.  Decide which one provides the services you need and best fits with your goals and objectives.

One insurance provider – usually you can consolidate your home and auto insurance which may lead to a discount.  Is there really a need to have separate insurance companies.  Again reduces the number of bills you must pay and keep track of.

So you can see how the power of one can help you simplify your personal finances.

Can you think of any other ways to reduce to one to help you simplify your personal finances?

If you would like learn more tips to help you simplify your personal finances make sure you subscribe to simple financial lifestyle email newsletter and subscribe to RSS feed for blog updates.

This post was featured in Carnival of Personal Finance: Parts of Speech Abuse Edition hosted by Mighty Bargain Hunter.

Many times we look to save money and do not properly insurance ourselves because we say hey its not going to happen to me. But you never know its always better to be prepared for the situation than unprepared. Think of it this way can you afford to rebuild your home if it was significantly damaged without having adequate insurance coverage? Probably not. So why put your financial future at risk to save a few extra bucks each month.

Here is what you must do to make sure you are not left standing financially naked:

Review your insurance policies regularly – Review your existing polices to determine the amount of coverage you have and what is covered. Many times we establish insurance policies and we never review them until we really need them and then find out what we thought was covered is not covered. Many times when you established the policy several years ago your financial situation was different than it is today. So remember to review your policies to understand your coverage.

Review your deductible – Know your deductible amount and make sure it is adequate. Many times we want to lower our insurance bill because we think it is too expensive. To do this we either reduce the coverage or increase our deductible. But before you decide to change your deductible consider the impact this can have on your financial situation. Yes it can lower your monthly or annual payment but what will happen when you need to file a claim will you have the funds. For example, you may be able save money by increasing your deductible from $1,000 to $2,000 but do you have the additional funds saved if something does occur. Look at the worse case and if your able to cover yourself without putting yourself in a significant financial burden if something does occur go for it. Just think before you do something just to save a little. The long-term consequences can be more damaging than the short-term relieve you will receive.

Financial stability of insurance company – How stable is your insurance company will be able to cover your claims. From year to year the financial stability of your insurance company can change which may impact their ability to pay your claims. What you don’t want to happen is your insurance company to go out of business when you need them. Trust me it does happen. Luckily, my claims were paid. So check on your insurance company’s rating to find out their financial situation.

Adequate coverage – Review your current financial situation and determine your appropriate coverage. For example, has your home increased in value and you need to increase the coverage. Have you made improvements or additions to your home which were not originally covered. Do you have significant cash or emergency fund to cover a higher deductible or do you need to lower your deductible due to lack of cash reserves. Do you have additional drivers in your household and need to review your current auto insurance. Has you first child been born and you need to review your medical coverage. Make sure your covered for your current situation. What was sufficient two years ago may not be sufficient coverage today.

Pay your premium on time – One of the worse feelings is finding out your insurance has been dropped because you did not pay your premium on time. Most insurance policy premiums have 30 day grace periods, which allows you to pay your premium within 30 days of its due date. However, if forget you to pay it within those 30 days you could be dropped and it is possible you may have to wait 30 days or longer to be reinstated. This means you will not be covered during this period so you may want to cross your fingers and hope nothing happens during that time. An easy solution to this is to set up an automatic debit from your bank account to the premium or have the premium automatically charged to your credit card. Here are two related post why you should pay on time and how you should pay.

Here are six insurance policies depending on your situation you should consider so your not left standing financially naked:

1) Homeowner’s / renter’s insurance
2) Medical insurance
3) Car insurance
4) Natural disaster insurance
5) Life insurance
6) Disability insurance

If you want to live a simple financial lifestyle take action now by reviewing your existing insurance coverage to make sure your adequately covered so your not left standing financially naked wondering what to do now.

Let me know how often you review your insurance policies?