Reasons to Prioritize Paying off Your Car Loan

When you pay off your car loan, feel free to celebrate! This is a major milestone. After devoting anywhere from 24 months to 84 months to such a large expense, no longer having that bill is quite a welcome relief.

And you can give yourself an extra reason to celebrate this event. Contact your insurance company and see the ways you can reduce your premiums with your new status. But don’t just focus on car insurance policy changes directly related to paying off your car loan.

There is a long list of discounts you owe it to yourself to explore. Most insurance companies make it fairly easy to look into them.

State Farm does this the best with their Discount Double Check program. What does discount double check mean? This program can help you save up to 40 percent on your car insurance rates.

What Happens When You Pay Off Your Car Loan

Obviously, you no longer have that monthly outlay for your car or possibly your child’s car. Did you know that these days, a car loan is one of the things parents of millennials are likely to pay for?

But you need to know what else actually happens when you pay your car loan off. Here are a few specific things that come with this financial milestone.

#1 – Your Car Title is Yours

Luckily, getting your car title takes virtually no effort on your part. After you make your last payment to the bank (or dealership), you will receive your title in the mail.

If you don’t receive your title in a few weeks, contact the bank that had your car loan to find out when you will receive it. If more time passes without receiving your title, then get in touch with your local DMV.

Your car title is important for your records, and it is needed for selling your car. Additionally, it can be used as collateral when you apply for credit.

#2 – Your Finances Have Some Flexibility

The urge is understandable to now see that car loan money as “play money.” You can treat yourself a little bit, but try to be smart. Don’t spend money just because you have it. You can reevaluate your budget and use these funds wisely.

First, think of your car. Yes, your loan is checked off, but there will always be gas, regular maintenance, the possibility of repairs, and the cost of any modifications you may wish to make.

You may even want to think ahead to your next car. If you save money, you can get a smaller car loan or perhaps you won’t even need a car loan at all.

Second, think of your car insurance. Having extra money put away can lower your insurance rates even more. You’ll be able to be better prepared for those unexpected costs if you save now.

#3 – Your Insurance Policy Needs Updated

Your initial contact with your car insurance company is to share the news that you paid off your loan. You need to do this in order for the lien holder to be removed from your policy, but you don’t need to wait until you have the title in hand.

This first step with your insurance company is essential. Without it, if your vehicle was totaled, the insurance payment would go to the lender named on your policy, not you.

Review Your Car Insurance for a Paid Off Vehicle

While there are common car insurance milestones you can benefit from like turning 25, getting married, and retiring, truly owning your own vehicle can be another one.

#1 – Check Collision and Comprehensive Coverage

Most lenders require additional insurance beyond the state-required minimum collision, which pays for vehicle damage caused by crashes and comprehensive, which pays for damages not related to an accident such as theft, falling tree, or a deer running into the road.

Check the car insurance requirements in your state. You may be able to drop collision and comprehensive coverage when you have fulfilled your loan responsibilities. If you can, just take into account that if you get into an accident, you may be responsible for covering repair costs or a new vehicle.

Shortly after your car is paid off, you may want to review whether to drop or not. Again, dropping this coverage is easier to do the bigger your emergency fund is.

#2 – Update Your Deductible

Now that you have a few hundred dollars extra a month, perhaps you can put all or a portion of that into savings, raise your deductible, and lower your car insurance rate.

If you are required to retain your collision and comprehensive coverage or if you choose to do so, you can save on your premium costs by raising your deductible.Since you’re accepting more risk, that gives your insurance company less risk, so they pass that savings on to you.

Just make sure you can afford to do it.

The deductible is the amount of money you will pay out-of-pocket when you make a claim. So if you are raising your deductible, have that extra amount of money in reserve so you’re not in trouble in the event of an accident.

Keep Saving with Discounts on Car Insurance

When you review your coverage with your insurance company, also ask them about all of the discounts they offer.

Common Car Insurance Discounts

Some common car insurance discounts include:

  • Multi-Policy – If you bundle your home insurance policy and auto insurance policy with one provider, you could save up to 20 percent on insurance rates.
  • Multi-Car – You will have a cheaper rate if you insure all of your vehicles together rather than individually.
  • Good Driver – This discount is usually for every driver who has been accident-free for a period of three to five years.
  • Good Student – Good grades ( usually a 3.0 grade point average) can translate to being rewarded with a discount.

Hidden Car Insurance Discounts

Don’t be shy in asking about these additional discounts:

  • Defensive Driving – Find classes in your area
  • Military – active and veterans
  • Group Affiliations – employment, service, or membership
  • Occupations – nurses and doctors, first responders, and federal employees
  • Car Safety Features – extra airbags, anti-lock brakes, anti-theft
  • Customer Loyalty – staying with the same insurance provider

Compare Car Insurance to Save

Shop around for car insurance at least annually. You may be happy with the changes already made to your car insurance just from now owning your car.

But check out at least a few other companies, and don’t just compare rate quotes. Check into their financial and consumer ratings as well. Seeing if you can do better with another company is another tip on how to save on your auto insurance once you’ve paid off your car loan.

How Polo Funding Helps Entrepreneurs Get a Fresh Start

Gary Vaynerchuk, an entrepreneur and motivational speaker, says in a rare expletive-free soundbite, “Your dreams don’t have to be ‘big;’ they have to be yours.”

Being an entrepreneur is about following your business dreams. But before you set out on your next venture, you need to take a good, hard look at your financial picture and assess whether you’re ready to go. Are you buried under a mountain of high-interest credit card debt? If so, you may want to jettison some of this baggage before you go into startup mode.

Debt Can Hurt Your Funding Opportunities

One of the main ways for entrepreneurs to fund a business is through bootstrapping. We’re not talking about Jeff Bezos today; we’re talking about Jeff Bezos in the 1990s, working out of his garage. Bootstrapping can be insanely difficult to do if you are already carrying debt from your personal finances or previous projects. Also, you’ll have more money to invest if you’re debt-free.

If you plan to secure funding through outside investors, they may want to see your financials. You stand to lose the opportunity to take on investor support if you are bogged down by existing debt.

Credit Cards: The Pitfalls

Credit cards can be good for entrepreneurs, but they can also cause trouble.

First, the good: Credit card rewards are one of the major perks of any small business owner. If you put all of your monthly transactions onto a credit card–and pay off the balance each month–you can rack up all kinds of travel points and other rewards. Not only that, but a credit card can help with auto-billing so that you don’t have to worry about overdrafts.

Now, the bad: Interest rates are the big killer. If you’re not paying off your balance every month, you start to accrue interest at a very high rate. Over time, this can build and build until you find that you’re only able to make payments on the interest. But a debt consolidation company like Polo Funding can help you get away from insurmountable monthly payments.

This leads to the question: Should you get rid of all credit cards? The answer for many entrepreneurs is: probably not. As mentioned above, credit cards can be highly useful in certain business scenarios. Again, avoid carrying over a balance. Use credit cards transactionally only.

How to Crush Your Existing Debt

There are all kinds of ways to eliminate debt. Many of them take a great deal of time and effort. Take the beans-and-rice method, for example. This method has you start eating beans and rice for dinner every night. The idea isn’t to bore you to death, but to have you stop spending money on going out to eat and all of the other kinds of things that add up to keep you in debt such as salon visits, streaming subscription services, happy hours, gym memberships, and the like. Instead, you would borrow books and movies from the local public library, take a break from drinking, exercise at home, and so on.

A more appealing method is a debt consolidation loan. Here, a funding company like Polo Funding helps you break free from those monthly payments that do little to make any headway. The consolidation loan they provide pays off your cards and leaves you with a single monthly payment at a low-interest rate. You can really save money and time getting out of debt this way, and maybe you don’t have to eat beans and rice for every meal. (By the way, please note that this is not an article on nutritional advice.)

Polo Funding: Are They Worth It?

The real question is: Do you want to get out of debt faster and for less money so that you can launch a new business? If you ask yourself this question and come back with an answer of yes, Polo Funding is absolutely worth it. They’ll work with the debt situation you’ve found yourself in, and they’ll give you a chance to get back onto your entrepreneurial path.

And then, once you’ve minimized–or even eliminated–your existing debt, you’ll have the freedom to pursue your next business venture with all of your time, energy, and resources. You won’t be worried about the old debt hanging over your head. While you don’t need to be 100% debt-free to be an entrepreneur, it can be extraordinarily helpful to uncomplicate your finances before you launch a new business.

Ways to Manage Financial Emergencies Without Going Into Debt

It only takes one unforeseen circumstance to throw your finances out of whack. Your car breaks down, a pipe bursts, the landlord raises the rent, you lose your job, you get sick or injured, and everything seems to fall apart. Overwhelmed with emotions and limited time to devise a plan, you make a decision that temporarily solves the problem, but creates issues down the road. You take out a loan or charge your credit card and then spend the next few months trying to figure out how you’ll survive.

Chances are you’ve been here at least once in your life. Though it may seem like the best thing to do when faced with a financial emergency is to borrow the money, there are other solutions. Continue reading to learn more.

Look for Financial Assistance

There are programs out there designed to help people when they’re in a financial jam. Let’s say you were in a car accident and suffered long-term injuries. A quick search of social security office locations near me and an application for disability benefits can turn things around. You’ll have the funds you need to tide you over until you’re able to get back on your feet or find another income source. The best part is, you don’t have to repay these funds, so there’s no debt to worry about. Before you assume there’s no way out of your circumstances, do some research on financial assistance opportunities.

Crunch Some Numbers

It may appear that you don’t have the income necessary to cover the emergency on the surface. However, with a bit more digging, most find this to be quite the opposite. If you were to ditch your cable services, downgrade your cell phone bill, stop buying coffee every day, and find more affordable ways to entertain yourself, you likely have the cash you need to pay for the unexpected expense. Before turning elsewhere to resolve your problems, get serious about your spending to see if you can handle it yourself.

Sell Some Things

As the saying goes, one person’s trash is another person’s treasure. Chances are you have things in your possession that you no longer use that could prove valuable to someone else. Whether it’s some old clothes and shoes, an outdated cell phone, jewelry, or a disabled vehicle, there are opportunities to earn some much-needed cash. You can find a specialized buyer, post and sell these items online, or have a yard sale. The sales proceeds could then be used to cover all or a portion of your emergency costs.

Turn to Friends and Family

Your friends and family are other sources you can turn to in your time of need. While they too may be strapped for cash, there are other ways they can help you out of a jam. For example, your sister may know a mechanic that’s willing to repair your car for a low rate. Your best friend’s husband could be an HVAC contractor that’s willing to repair your air conditioner and allow you to repay them in affordable monthly installments.

Earn Some Cash

When faced with long-term emergencies like the loss of a loved one or job, there’s also the option to earn more money. It doesn’t have to be as involved as filling out applications, going to countless interviews, and working another full or part-time job. There are plenty of ways to earn money relatively quickly. You can cut someone’s grass, walk the neighbor’s dogs, offer to babysit, housesit for a relative that’s going out of town, sign up for a rideshare service, deliver groceries or food, and so much more. Many of these options will pay you cash daily to handle your emergency without skipping a beat.

Taking out a personal loan, borrowing on your retirement savings, or charging your credit card are the most common solutions for getting out of financial trouble. While these options can resolve the immediate problem, it can take you months or even years to repay. The most efficient way to tackle a financial emergency is to exhaust the options listed above first.