In the past, we’ve talked about the high cost of elder care. Now, I wanted to spend a bit of time talking about long term care (LTC) insurance.

In general terms, LTC coverage applies to individuals who are not actually sick, but are not able to perform the basic “activities of daily living.” These include things like bathing, using the bathroom, dressing, eating, or transferring yourself in/out of a bed or chair.

In most cases, coverage is also available for those with a cognitive impairment. This could include:

• memory loss (short- or long-term)
• loss of orientation as to people (who they or others are), places, or time
• reduced capacity for deductive or abstract reasoning

If the impairment is bad enough that it requires supervision to ensure safety, most LTC policies will kick in.

Related: Do You Need Disability Insurance?

According to the Department of Health and Human Services, about 70% of those aged 65 or older will require some sort of long term care during their lifetime. Over 40% require care in a nursing home. For the most part, traditional health insurance and Medicare won’t cover the costs associated with this care.

In other words, you’re on your own. You’d be well-advised to plan ahead.

What follows is a list of important considerations when it comes to choosing a long term care policy. This list is by no means exhaustive. It’s mainly based on things that I’ve run across while reading through my parents’ policies. But it at least gives you a good place to start.

When to buy LTC insurance

First and foremost, you’ll need to decide when to buy your policy.

If you buy too soon, you may wind up paying for coverage that you don’t need yet. But if you wait too long, the premiums will be sky high. Also, the longer you wait, the more likely it is that an insurance company will reject your application.

For reference, more than half of all policies are sold to those in the 55-64 age group. While an argument could be made for buying as early as age 45, the recommended age is 50.

Benefit level

Another important consideration is how much coverage you’ll need. Obviously, more is better, but higher benefits come at increased cost.

It really seems like this one falls into the “it depends” category. The costs associated with different types of care vary widely across the country. In other words, one size doesn’t fit all.

In order to determine how much coverage you should buy, you need to consider your individual situation. Here are a few questions to ask yourself:

• How is my current health? What about my parents’ health — do/did they need skilled care?
• Do I have children or a spouse to consider?
• What is our financial situation? Do I feel comfortable using my nest egg (potentially my children’s inheritance) on care?
• What is my monthly income, or what will my (estimated) monthly income be when I am most likely to need LTC?
• Do/Will I qualify for Medicare coverage (and its strict criteria), which partially covers up to 100 days in a skilled nursing facility?
• How high can I afford my deductible to be, noting that if coverage is for both me and my spouse, this deductible will need to be reached twice (once for each of us) if we both require care?

Keep in mind that the average private room in a nursing home will run you somewhere around $250 a day. If an assisted living facility is more likely to meet your needs, that’s a little cheaper. But it still carries an average price tag of $3,550 a month.

You also need to remember that skilled care isn’t a permanent need. It’s unlikely that you’ll need these services for more than 5 years (only about 20% of today’s 65 year-olds will), so that probably the maximum amount of time you’ll want to account for when determining your coverage.

For example, here are the average lengths of time that skilled care is needed based on the facility type:

longtermcare.acl.gov/the-basics/how-much-care-will-you-need.html

Related: How Much Life Insurance Do You Need?

Benefit increase option

Related to the above, costs associated with long term care will increase over time. Do you want your benefit level to increase, as well?

In many cases, you can elect a “benefit increase” option to help keep pace with inflation, though this will likely come at a cost. Still, this is worth at least considering, especially if you buy a policy relatively early.

Elimination (waiting) period

The elimination period is a bit like a deductible. You’ll have to pay for the care yourself (out-of-pocket) for a set period of time before your LTC benefits kick in.

Elimination periods can vary from 0-365 days, though 90 days seems fairly common. Note that you can typically only count those days on which costs were actually incurred. This means that you can’t just pay someone to come in once a week for 3 months and still satisfy a 90-day elimination period.

Waiver of premium

Once the benefits kick in, do you need to keep paying the premium? In some cases, yes, in other cases, no.

In my parents’ case, the waiver of premium appears to only kick in after they’ve spent 60 days in a nursing home. It doesn’t appear to apply to in-home health care (though, I’m still trying to track this down). This is a bit of a bummer, but it is what it is.

Be sure to check your policy’s terms and find out what your coverage dictates.

Maximum lifetime benefit

Finally, depending on the policy that you choose, there may be a maximum lifetime benefit.

This limit can be defined either in terms of a total dollar amount, or a set number of years over which the policy will pay out. Choose carefully, as you may live longer than you expect, and these costs really add up over time.

Learn More: I’m Not Covered? Five Ways to Trigger Nasty Insurance Surprises

At the end of the day, long term care coverage is like all other insurance policies: you need to read the fine print and know what you’re buying before you write that first check.

Considering how many adults will end up needing long term care, it’s smart to begin shopping around for a policy in your late 40s. You don’t want to buy too soon and waste money on coverage, but you also can’t wait too late, when premiums jump in price.

Do you have any tips for other readers looking into long term coverage? Leave them in the comments below!

Adding a teenager to a car insurance policy is costly. If done correctly, however, there are ways to reduce those costs. Here are 5 ways to find the best car insurance for teens.

Having a teen who can drive is a big adjustment. There’s helping them learn to drive and the worrying when they are on the road. And then there’s the rise in auto insurance rates, which you’ll notice immediately.

It’s no secret that teen drivers are pricey to insure. Research from AAA shows that teen drivers are three times more likely than adults to be involved in a fatal crash. Insurance companies know that teens are riskier to insure than older drivers.

The good news is that there are some steps you can take to keep rates under control.

The Basics of Buying Car Insurance for Your Teen

Every driver is required to be covered by a car insurance policy. A teen won’t automatically be covered under your policy just because they are a dependent. You have to add them to your policy.

It’s going to be cheaper in almost every case to add a teenager to your existing policy than it would be to purchase a separate policy. However, you’ll still want to do a little bit of research.

The first step is reaching out to your current insurance company or agent. It may be a good idea to reach out as soon as your teen gets a permit. You may not be required to add them to your policy until they have their license, but this varies from one insurance company to another.

Here are the steps to take to make sure your teenager has insurance waiting as soon as a driver’s license is issued:

• Get a quote from your insurance company for adding your child to your existing policy
• Get a quote from at least one other agency to see if you could get a better rate than what you’d pay with your current company
• Add your teen to your policy once a driver’s license has been issued (or earlier if required)

It may be possible for your teen to purchase a car and obtain insurance alone. However, state laws will determine whether or not this is a possibility in your case. Minors generally can’t own property or sign insurance contracts without at least the consent of a parent.

Comparing Auto Rates

Adding a young driver to your policy is a perfect time to compare insurance rates. Here are several of the best auto insurance options for teens:

USAA: For those in the military or with qualifying family members who serve, USAA offers excellent rates. It also offers a good student discount for high school and college students.

GEICO: Best known for its commercials, GEICO offers low rates by selling direct to consumers. Unlike most other insurance companies, it doesn’t have an army of agents.

Progressive: If your teen driver is particularly safe on the road, Progressive’s Snapshot may be a real money saver. It tracks the operation of the car for a period and may offer discounts based on the results.

State Farm: They offer significant discount opportunities for young drivers. These include safe driving discounts, good student discounts, and driver safety discounts.

Allstate: Finally, Allstate offers a good grades discount. It also offers what it calls a teenSMART discount. According to Allstate, you can save “up to 10% when your young [driver] successfully completes the teenSMART driver education program.”

Getting Insurance When a Teen Belongs to Two Households

The parent with primary custody is typically responsible for adding a minor driver to a policy. However, some laws or insurance policies may require both parents to provide insurance for a teen driver. Talk to your insurance agent to make sure you understand the rules.

The Car Your Teen Drives Will Help to Determine Your Rate

Parents can expect to pay an additional $671 annually once they add a teen driver to an auto policy. One way to get the best rate possible is to assign your teen to the cheapest vehicle you own. You can also shop around for vehicle models with low auto insurance losses if your teen needs to purchase a new car. Vehicles with low losses are far less expensive to insure.

The 100 Mile Rule

For college students, they can save by leaving the car at home. If your student goes to school more than 100 miles from home but leaves the car at home, most insurance companies discount your premiums.

Don’t Forget to Get Discounts

While you may be dreading paying more to have a teen driver in your household, there are many opportunities to get discounts. Here are some of the more common discounts offered by many insurance companies:

• Good student discounts (typically requires a ‘B’ average or better);
• Snapshot or other driver evaluation technology
• Multiple car discounts (one reason it’s usually best to add a teen to your policy)
• Completion of Driver Safety Programs
• 100 Mile Away discount (for college students)

Your auto insurance agency may even offer a discount if your teen signs a driving contract and promises to always wear a seatbelt, call for a ride when impaired, practice good car maintenance, and never text or eat while driving.

Homeowners insurance is a necessity for those who own a home. It’s also required by mortgage companies. Here are some practical ways to save money on homeowners insurance.

We’ve written in the past about how to save money on health insurance, life insurance, and car insurance.

Today, I’m going to round things out with an article about saving money on your homeowner’s insurance. If you have a mortgage, this is likely a mandatory expense, as your lender will require it. If you own your home outright, it’s simply a smart one.

Just because you have to have homeowner’s insurance, though, doesn’t mean that you are stuck paying an arm and a leg for it. What follows is a list of eight tips for reducing your premiums. Combine them all, and you could be save a ton of money while protecting your home from damage or loss.

1. Focus on your rebuilding costs

When you think of homeowner’s insurance, what’s the first thing that comes to mind? For me, it’s the thought of my house burning down, and my family losing everything that we have. My second thought is of being burglarized (which actually happened in 2009), and all of my valuables taken. Those are my whys.

Now, how do you determine how much insurance you actually need? Is it dependent on your home’s current value, if you were to sell today? The added value of everything inside the walls?

While you absolutely need to insure your home and its contents against destruction, there’s usually no need to insure the land that it’s built on. Thus, it’s important to think of your actual rebuilding costs (as well as the cost to replace your stuff) when buying a policy.

This may be wildly different than the current market value of your home, depending on a number of circumstances. However, it’s important to do a bit of research before settling on a coverage amount. If you don’t, you might end up over-insuring and paying too much each month.

2. Increase your deductible

In this way, homeowner’s insurance isn’t any different than other types of insurance. If you’re willing to bear a greater portion of the risk, you can save a significant amount of money.

To save money this way, simply call your agent and ask them to increase your deductible. In turn, your monthly payments should go down, possibly significantly.

It’s important to note that homeowner’s policies are managed a bit differently than car insurance or personal property insurance. Those deductibles are typically much lower, and bumping yours from $250 to $500 or $1,000 might not be a budget breaker.

Resource: Does Raising Your Car Insurance Deductible Also Save You Money?

However, many homeowner’s policies are percentage-based. This means that your deductible is actually contingent on the amount of coverage you hold (the value of your home and its contents).

My own insurance works this way, and the deductible is 1% of the policy coverage ($190,000). This means that every time I make a claim, I’m stuck paying the first $1,900. Were I to bump this deductible to 1.5% or 2%, in order to save on premiums, we would be talking about an increase of either $950 or $1,900. And that would probably sting a bit.

Depending on your policy, raising your deductible can be a great way to save money, month over month. Before you do this, though, just be sure that your emergency fund is large enough to cover your out-of-pocket expenses in the event of a disaster. Raising your deductible from $500 to $1,500 may save you $20 a month, but that’s not worth it if you don’t have that cash lying around in case of an emergency.

3. Upgrade your security

Beef up the protection around your home, and your insurance company will probably rewards you.

Things like deadbolt locks, burglar alarms, fire extinguishers, and smoke detectors can earn you a nice discount. In some cases, these discounts can offset most (if not all) of the additional costs of adding these safeguards, too. So, it’s well worth checking with your insurer for details.

Some home security companies also offer discounts to customers of certain insurance companies, which means you can double up on the savings.

For instance, my policy is through USAA, and I get a safe home discount for having security monitoring services. I also get a discount through my home security company (ADT), for being a USAA customer/member. Wins all around!

4. Bundle multiple policy types together

You will usually get a nice discount for carrying multiple policies with a single company, and it’s rare to find an insurance company that doesn’t offer at least one other insurance product.

Related: The Hidden Savings In a Rent Payment

I actually have two car policies, our homeowner’s policy, a personal articles policy (for jewelry and other valuables), and a life insurance policy all with the same company. The bundle discounts I receive, compounded with the already-lower rates, mean that I pay substantially less that I would if I had these policies spread around amongst multiple companies.

5. Location, location, location

This one is tough to implement if you already own your home. However, if you’re shopping around or plan to buy/build in the near future, it may be worth keeping in mind during your home search.

Your home’s proximity to fire hydrants, fire stations, and the like can (surprisingly) influence your premiums. Not surprisingly: closer is better.

No, it doesn’t make sense to move to reduce your premiums, but it’s worth keeping in mind when buying that new home.

6. Keep your credit report clean

Credit really is at the center of everything financial. It impacts your interest rates; potential employers can pull it when you apply for a job, and it can even mean higher premiums on your insurance policies.

Yes, like it or not, your credit report can influence your insurance rates. Insurance companies have no shame in considering clean credit to be an indicator of reduced risk.

Thus, it’s important that you check your credit report regularly, and fix any errors that you find. Of course, this is something you should be doing anyway – at least, if you ever want to lock in a lower interest rate on your mortgage refi or snag that exciting new rewards credit card.

Learn More: Get a Better Mortgage Rate Without Refinancing

Now, you just have more of a reason to stay on top of it all.

7. Ask about other discounts

The easiest way to get a lower price? Simply ask for one.

You can often get a group discount (e.g., alumni association, senior discount, etc.) just for asking. There are also discounts for home improvements that you might want to make anyway, or you can also let your insurance company know about certain neighborhood features of which they might not be aware (for instance, whether you’re in a gated community).

In the same thread as replacing smoke detectors and adding fire extinguishers, you may want to consider some “big ticket” repairs. Are you looking at replacing that old roof anyway? Ask your insurance company if there’s a discount if you opt for an impact-resistant material. Want to remodel the kitchen? Let your insurance company know you replaced that old electrical wiring, and it might snag you a few extra dollars off.

Related: Renovations That Can Hurt the Value of Your Home

Give your agent a call today and find out if there are any discounts they can apply to reduce your premiums. If you don’t currently qualify, perhaps there is a group that you can join or a home upgrade you can complete to get an additional discount.

The worst they can say is no, so it’s worth asking.

8. Shop around

Assuming you’re doing everything else right, another great way to save money on homeowners insurance is to comparison shop.

You can either call around to local agents or check a homeowners insurance comparison tool. Also ask friends, neighbors, and your credit union (if you’re a member). You may learn about big incentives, discounts, or at the very least, will likely hear a number of pros/cons for certain companies.

Whatever you do, be sure to buy your policy from a reputable company. That way, you won’t run into any problems if and when you file a claim.

Learn More: 10 tips most first-time home buyers don’t consider

So, there you have it. These eight simple tips for saving money on homeowner’s insurance can help you save quite a bit of cash each month.

Implement a few of them over time, and you’ll save even more. Be sure to ask each time you renew your policy whether there are additional discounts you could be getting, and shop around regularly to find the best price.

If you have any further suggestions, please be sure to share them in the comments.