Homeowner’s insurance helps to protect your most valuable investment—your home. But homeowner’s policies can vary in cost, depending on where you live and what you’re insuring. Following are homeowner’s insurance costs explained so that you can make decisions about your specific needs.
Why you need homeowner’s insurance
If you have a home mortgage, you are required to have homeowner’s insurance. Even if you don’t have a mortgage, it’s recommended that you have insurance to protect your home.
In cases of fire, wind, snow and other covered perils
In case you are held responsible for an accident or injury
How much coverage you will need depends upon your location, the size and scope of your home/dwelling, other structures on your property, and your personal belongings. You don’t want to shortchange the amount of coverage, or you may not have enough to rebuild your home or replace your possessions in the event of a claim.
Note that homeowner’s insurance is not the same as mortgage insurance. Mortgage insurance is required when you put less than 20% down when you buy your home. Mortgage insurance protects the lender. Home insurance protects your home.
Depending on where you live, you may face different types of risks which can affect your home. These include extreme heat, drought, fire, and severe storms. Your insurer will take those risks into account when pricing your policy.
There also are natural disasters such as flooding and earthquakes which are not covered by homeowner’s insurance. You can add these coverages with a separate policy or an endorsement added to your property policy.
Dwelling Coverage
Coverage A, dwelling coverage, covers the structure of your home. This includes the roof, walls, floorboards, cabinets and bath fixtures. Essentially, if you could tip your house upside down, it would cover everything that remains attached. Under dwelling coverage, your insurance provider will pay to rebuild your house if the structure is damaged by a covered peril. Coverage for the dwelling and other structures is categorized as “open perils,” meaning it’s covered unless it’s excluded. Building materials like hardwood floors, gourmet kitchens, granite counters, and tile roofs are all factored into the appropriate amount of insurance you would be offered under dwelling coverage.
Especially in periods of economic inflation and building supply or labor shortages, the true rebuild cost of your home may be substantially higher than the market value and even much higher than the cost of building a new house on an empty lot. If your insurance provider hasn’t recalculated the cost to rebuild your home recently, then you may be at risk of running out of coverage if you experience a total loss. That’s why it’s good to periodically check with your provider to make sure you are fully covered.
Other Structures
You may have a swimming pool, shed, detached garage, or fence. These are other structures that can be damaged and therefore need to be included in your insurance policy. Other structures coverage will cover damage to these structures that is not specifically excluded in the policy.
The coverage limit for other structures is generally set at 10% of your home’s coverage limit. That means if your home is insured for $200,000, the coverage limit for your detached garage would be $20,000. For an additional premium, you can add an endorsement for additional coverage.
Personal Property Coverage
Personal property coverage protects your possessions. If they are stolen, or damaged by fire/smoke or any of 16 named “perils,” your policy will pay for them subject to your deductible. There are dollar limits for theft of certain items, such as jewelry and firearms.
You may choose the replacement cost or the actual cash value (ACV) for reimbursement in personal property coverage. ACV is the amount the item is worth, minus depreciation for its age. It will cost a little more for a policy that provides replacement cost since that is higher than ACV.
Liability Coverage
Liability coverage includes two coverages:Coverage E – Personal Liability and Coverage F – Medical Payments to Others.
Personal Liability protects you if a claim is made or a suit brought against you for bodily injury or property damage caused by an occurrence to which coverage applies. An occurrence means an accident, which results in Bodily injury or Property damage. If you are found liable, the policy will pay up to its limit of liability for damages for which an insured is legally liable. This can include medical expenses, lost wages, pain and suffering and permanent scarring. The policy also provides a defense in court, if needed, for the policyholder. This is at the insurance company’s own expense.
You want to make sure you have enough coverage to protect your assets – a minimum amount is $100,000. Liability covers you at your place or anywhere in the world. For example, if your dog bites someone, you’re covered. The policy pays for the bite victim’s medical expenses and covers court fees if they sue you.
If you are not liable, but your guest was injured through his/her own fault, then Coverage F – Medical Payment to Others may cover your guest’s medical bills. Under Coverage F, the insurance company will pay the necessary medical expenses to a person injured on the insured location with the permission of an insured, or off the insured location if the injury is caused by the activities of an insured or caused by an animal owned by an insured.
Additional Living Expenses
If your home is damaged in a covered claim, it may not be livable. If that’s the case, you would need to stay somewhere else. You would be covered for any necessary increase in living expenses, such as lodging, food, and gas. Under Coverage D – Loss of Use, called “Additional Living Expense,” your policy will provide a flat percentage toward living costs, usually 30% of the Coverage A amount. Some states have time limits (e.g. 12 months) on when you can use that coverage. Plan to cover those additional expenses out-of-pocket.
Deductible
Generally, the higher your deductible, the lower the cost of your insurance premium. Since the deductible is the amount your insurance provider will subtract from an insurance payout, you’ll have to select a deductible that you’re comfortable paying out-of-pocket after a loss.
Other Things That Affect Cost
Finally, there are other items that can affect the cost of a policy. Your insurance claim history could be factored in. If you have a number of past claims, or the home you are trying to insure has a number of claims, your rate could be higher. The age of your home and condition of your roof may be taken into account.
This article is furnished by California Casualty, providing auto and home insurance to educators, law enforcement officers, firefighters, and nurses. Get a quote at 1.866.704.8614 or www.calcas.com.
Utility bills aren’t cheap. On average, Americans spend more than $4,400 per year on gas, electric, water, and other home-related services. Fortunately, there are things you can do to help reduce that cost. We’ve compiled a list of some small changes that can really add up over time. Read on to find out how you can save money on utilities this year.
#1. Heating and Cooling
Heating and cooling your home accounts for more than half of the energy that you use. Reducing this cost can make a big impact.
Use a programmable thermostat. Set the temperature lower while you’re away from home and at night while you’re sleeping. Just make sure it is still comfortable for any pets you may have and that it’s warm enough to protect against frozen pipes.
Use fans. They cost less than your furnace or air conditioner and can help with both heating and cooling. For heat, adjust your ceiling fan so it turns clockwise. That will push warm air down. For cooling, switch it to turn counterclockwise to bring cool air down. In warmer months, try plugging in floor or pedestal fans rather than turning on your air.
Change the filters for forced air furnaces, heat pumps, and air conditioners. A clogged filter makes your system work harder, which is more expensive.
Keep your room’s air vents clear and open. Your system also works harder when vents are closed or blocked by furniture. Use your vacuum’s brush attachment to clean any dust around the vent. The more your system can “breathe,” the more efficiently it will work.
Trim back bushes from your outside air conditioning unit. Remove debris touching the system. It needs at least a foot of space.
Seal air leaks around doors and windows. This helps keep warm air in during the winter and cool air in during the summer.
Check your attic’s duct work. It may be allowing warm or cool air out. Make sure you have proper insulation and that there are no air leaks at seals and joints.
Turn the heat or air off completely in the shoulder seasons. Run it only when it starts to get uncomfortably warm or cold.
#2. Electricity and Lighting
The average electricity bill in the U.S. is $115 monthly. That’s nearly $1,400 a year. Fortunately, there are simple ways to reduce this cost.
Turn off lights when you are not using them.
Change light bulbs to energy efficient varieties. Compact fluorescent light bulbs and LED bulbs are the most energy efficient. They cost more upfront but last longer and save energy. Pro Tip: If you don’t have the cash to replace them all at once just replace bulbs as they burn out.
The electric company charges more for peak use times, so try to use electricity at off peak hours. Run your dishwasher or do your laundry late at night or early in the morning to save some money.
Seal your electrical sockets so warm or cool air doesn’t escape.
#3. Appliances
We depend on our appliances to make life easier. However, by changing just a few of our habits, we can continue to use them and save money at the same time.
Turn off electronics that are plugged in but not being used. This includes TVs, computers, coffee makers, and toaster ovens. When these electronics are plugged in, they still draw electricity and you’re charged for it.
Use appliances wisely. Wait until the dishwasher is full to run it, and do the same for your washing machine. Reduce stove or oven cooking time by thawing foods and cutting vegetables into small pieces.
Avoid opening the fridge to browse. Each time you do, you’re releasing cold air and forcing your refrigerator to work harder to get back to temperature. If you have a second refrigerator, in the garage for example, you’re paying twice. Get rid of it if you can.
Lower your water heater temperature. The default temperature is 140 degrees, but if you drop it down to 120, you’ll still have hot water and save money.
Do laundry in cold water.It will save on hot water heating costs.
Clean the lint trap in your clothes dryer to help improve efficiency and prevent fires. Pro Tip: Use dryer balls, which can reduce drying time by up to 25%.
Replace old appliances. New appliances are more energy efficient and will save you money over time.
#4. Water
Your water bill depends upon where you live and how much water your family uses. Make sure to use your water wisely.
Replace old, inefficient toilets with more efficient brands. This will save you gallons of water and money on your bill.
Take shorter showers to cut down on your water use. Invest in a more efficient showerhead that uses less water.
Fix leaky faucets. A dripping faucet can add a lot to your bill for water you’re not even using.
Turn off hot water when you are not using it. This will help reduce water use and heat.
Set the water level on your washer to match the size of the load, so you’re not overfilling it.
#5. Phone, Internet, and Cable
If you’re like most Americans, you spend a lot for your phone, internet, cable, and other viewing services. You want to make sure that you get value for your money.
Ask your current provider for discounts. If they don’t provide them, shop around for cheaper providers. Call on a weekday. You’ll have a shorter hold time and probably reach a higher-level rep to help you. Pro Tip: Don’t say yes to the first offer. Most likely, you’ll then be offered a better deal.
Determine which services you really need and cut those that you don’t use.
Buy your own equipment rather than renting it. You’ll save money in the long term.
This article is furnished by California Casualty, providing auto and home insurance to educators, law enforcement officers, firefighters, and nurses. Get a quote at 1.866.704.8614 or www.calcas.com.
It may not seem like a big deal, but forgetting to make an auto or home insurance payment or having a lapse in coverage can have serious repercussions.
Let’s say you don’t drive that much anymore, so you miss an insurance payment or two, but then you get into an accident… If your premium goes unpaid, your insurance policy is void. Meaning, your insurance company is not obligated to rewrite your policy. You’ll be left without coverage and will likely have a higher rate when you do find a new carrier because the lapse has now left you labeled as “high risk”.
Your cancel notice gives you the date that payment must be received by, and if that date occurs with no payment, the system will automatically cancel your policy. Once you’re canceled, your carrier will not take you back unless they are required by law.
Let’s dive further into more facts and answer some questions every vehicle or homeowner should know about their coverage.
Home insurance is required if you have a mortgage.
While home insurance isn’t required by law, your lender will require you to be insured if you have a mortgage. Your policy will need to cover wind, hail,fire, and vandalism. The lender will be named as an additional insured. Should you file a claim for damage or loss, the insurance company will issue a two-party check naming you as the insured along with the mortgage company.
If you fail to pay your home insurance, you could have a lapse in coverage. Your policy will cancel, which is a violation of your mortgage agreement, and there will be no coverage in the event of a loss or claim. Also, the homeowner’s insurance is a package, which covers the home, other structures, your personal property, additional living expenses, and provides personal liability. You will lose all of that if the policy cancels.
Car insurance is required by law.
In every state except New Hampshire, you’re required to have car insurance. You have to have minimum coverage in case you get in an accident, though what you are required to carry does vary by state.
When you register your car, you submit proof of insurance. When you buy a car, you can’t leave the lot without signing up for insurance. It’s just along the way that you might accidentally, or on purpose, miss a payment and cause your insurance to lapse.
What is a lapse?
You pay for a specific time period on your insurance. It may be six months, a year, or another timeframe. In all cases, you will have a start date and an end date. As long as you are paying the bills on time, all is well.
If, however, you miss a payment, your coverage lapses. A lapse in coverage can be as short as one day or it can be much longer. Like other bills that you may be late in paying, there may be a grace period and a late fee. Unlike other services, however, you might face more severe consequences including government-mandated ones, if the lapse goes too long.
What happens when you drive without insurance?
If your insurance premium goes unpaid for long enough, your insurer will cancel your policy. Insurance helps with the financial responsibility if you get into an accident. Because it is usually required by law, there are additional consequences if you don’t have it. Here’s a summary of what you can expect if you let your insurance lapse.
If you’re in an accident, you would be fully responsible for any damages or injuries.
Depending upon the state where you live, you may be limited in the amount that you can sue the at-fault driver.
Your insurance company may cancel your policy and alert the Division of Motor Vehicles.
Your license and registration may be revoked, and you would be responsible for paying daily fines to the Division of Motor Vehicles. You may also have to pay a fine to reinstate your license and registration.
Once you are reinsured, you may need to carry an SR-22 form with you for three years, showing proof that you have the minimum required insurance.
You may have difficulty getting insurance again, as you’re now considered a risk. If you do get insurance, your insurer can raise your rates. Drivers with a coverage lapse of 30 days or more saw an average premium increase of 35%.
Your car could be repossessed if it is leased or if you are paying a loan.
Your credit score may drop, which can affect your ability to get a loan or credit card. The lapse will remain on your credit report for up to 7 years.
What happens if your home insurance is canceled?
If you lapse in payments for your home insurance, and as a result, your policy is canceled, your mortgage lender will be informed in writing.
Your lender can force you into a more expensive policy, called forced-placed insurance. This insurance only covers the loan amount for the mortgage company. There is no coverage for your belongings or personal liability. Therefore, if the house costs more to rebuild than the remaining loan amount, it won’t be covered.
If you don’t agree to the insurance, your lender can send your loan into default. This presents a risk of losing your home to foreclosure.
Your credit score will drop as a result.
Without insurance, whether or not you have a mortgage, you are responsible for 100% of the costs for any damage to your home if something unexpected happens.
What should you do if you have a lapse in coverage?
Once you realize your policy has been canceled or you’ve missed a payment call your insurance company and see what can be done.
Find out if they are able to rewrite your policy. Pay whatever fines are needed. Many companies may charge extra or interest fees on the remaining balance but California Casualty only charges a small monthly fee.
If you cancel over a certain number of days, you will be looked at as a brand-new customer and have to meet all underwriting guidelines. You may lose certain discounts or benefits for customer loyalty.
If you’re unable to make your insurance payment, let your insurer know. They may be able to adjust the policy to lower your cost.
Your insurer may deny you coverage. In that case, you will need to shop around for a new policy. Be honest with the new company. They will be able to check to see if your coverage has lapsed in the past. Be prepared to pay a higher premium because of it.
After you get insurance again, contact your state’s Division of Motor Vehicles to update your insurance information. Make sure that your registration and license are still valid.
Similarly, update your mortgage lender if your home insurance has been affected.
If you’ve changed insurance companies, and you owe your old insurance company any money, make sure to pay it. They will likely pass it along to a debt collection agency if you do not.
How can you prevent a lapse?
The best way to avoid any lapse in coverage is to set up a system so you will pay your premium
on time.
Pay the premium in full if you are able to do so. Consider using your credit card for your annual insurance payment to get extra credit card award points. There is a cost savings and convenience of paying in full with most policies. At California Casualty, if the state allows, both auto and home policies offer this type of savings.
Set up automatic payments such as an EFT from your checking account or a payroll deduction, if offered or available.
Set a reminder on your phone or calendar for your premium due date.
Make sure you know the end date of your policy. From 30-60 days prior to the renewal, California Casualty sends out a renewal policy for the insured to review. Schedule a time with an agent to review your policy to see if you need any updates before the renewal takes place.
If you switch insurance companies, make sure to time the start date of your new policy with the end date of your old policy so there is no lapse.
Talk to your insurer about options if you are not driving for an extended period of time. For example, you may be deployed overseas. You still may want coverage since your car would remain at risk for damage due to weather or vandalism, and it could be stolen. However, you can suspend coverage for a time period, including while you are deployed or on sabbatical. This may not be an option if your car is leased or you’re paying off a loan.
This article is furnished by California Casualty, providing auto and home insurance to educators, law enforcement officers, firefighters, and nurses. Get a quote at 1.866.704.8614 or www.calcas.com.
From groceries to gas, it seems like we’re paying more for everything these days. Now insurance rates are increasing as well. Why is this happening, and more importantly, what can we do about it? Here’s what you need to know.
What we’re seeing…
Car insurance rates rose 9% over the course of 2022, a trend that is expected to continue with another 7% rate growth in 2023 according to Insurify. Home insurance rates increased by an average of 12.1% in 2021, and another 3% in 2022 said Bankrate.com. Experts predict rate increases each year for the next few years due to the perfect storm of inflation, supply chain issues, weather changes, and other factors.
We’re experiencing historic inflation.
Inflation is at its highest level in decades. Inflation has had a significant impact on the cost of auto parts and labor, as well as medical expenses for bodily injuries.
From March 2021 to March 2022, here’s how prices have increased:
Medical services – increased 2.9%
Auto repair costs – increased 4.9%
Car rental costs – increased 13.8%
Used vehicles – increased 35.3%
Similarly, the costs associated with a home claim also have been affected by inflation. This includes additional temporary living expenses, replacement of personal property and home furnishings, cost of construction labor, and costs of construction supplies.
From March 2021 to March 2022, here’s how prices have increased:
Rent – increased 5.1%
Home furnishings – increased 10.1%
Construction labor and trade services – increased 21.3%
Construction materials and goods – increased 22.2%
Supply Chain Issues
There are supply chain issues created by the pandemic and by a labor shortage. When we can’t get parts or supplies to repair a vehicle or a home, the process becomes lengthier and results in repairs simply costing more.
Other Factors
The severity and frequency of vehicle accidents are on the rise. Traffic fatalities reached a 16-year high in 2021 according to the National Highway Traffic Safety Administration, due to an increased trend in post-pandemic risky driving behaviors – speeding, driving distracted, not wearing seatbelts, and driving under the influence. This rise in accidents directly affects claims, which contributes to rising auto insurance costs.
Similar conditions come into play for home insurance costs. The number of extreme climate events and weather disasters is also increasing. In 2022, there were 18 disasters with losses of more than $1 billion each, according to the National Centers for Environmental Information.
An inside look at how this affects your insurance rate
As material and labor costs rise, the cost to repair and replace damaged homes and vehicles increases. Factor in the ongoing supply chain issues and costs increase even more. The amount you pay for insurance is likely to go up when the cost to settle claims rises.
“But I’ve never been in an accident, so why would my rate go up?”
Even if you have a spotless driving record or never filed a claim, it’s likely that your insurance costs could be impacted due to economic factors that are out of your control – regardless of the company that provides your coverage. Insurers across the country have been raising rates, some multiple times in the past 12 months. However, it’s not all doom and gloom. There are ways you may be able to reduce your costs.
What You Can Do to Lower Your Premiums
Your insurance provider can recommend adjustments that still give you the quality coverage you need but with a lower premium. Start with a thorough policy review and make sure to look at these areas.
• Review deductible options. Generally, the higher your deductible, the lower the cost of your insurance premium. Since the deductible is the amount your insurance provider will subtract from an insurance payout, you’ll have to select a deductible that you’re comfortable paying out-of-pocket after a loss. Note that there can be diminishing returns if you set your deductible much higher than average, so as a consumer, you need to balance the premium savings against the amount you’d be required to pay after a loss.
• Take advantage of discounts. You may qualify for insurance discounts for being part of a professional association, such as groups for teachers, nurses, or first responders. There are also discounts for being retired, good student discounts, setting up automated payments, and for paying in full upfront. You may also receive a discount for quoting online.
• Buy home and auto insurance from the same company. When you bundle your home and auto insurance, you can often qualify for reduced rates, saving hundreds of dollars.
• Remove Gap coverage if no longer needed. When you buy or lease a new vehicle, it starts depreciating once you drive it off the lot. Gap insurance ensures that you will get the full replacement value of your car if it is totaled or stolen. As a car begins to age, this gap goes down and the need for coverage is less.
• Make your home disaster resistant. Talk to your insurance agent about how you can disaster-proof your home. You may be able to save on your premiums by adding storm shutters, reinforcing your roof or buying stronger roof materials, or even clearing brush from around your home. Older homes can be retrofitted to make them better able to withstand earthquakes or other natural disasters. In addition, consider modernizing your heating, plumbing, and electrical systems to reduce the risk of fire and water damage.
• Choose electronic documents rather than mail. This is an easy change that often comes with a discount and can add up in the long run.
California Casualty has been slower with rate increases than the bigger carriers. We will always strive to keep our prices as affordable as possible for our members. When we do make rate changes, it is to be able to maintain the financial fortitude to keep our promises to every policyholder during their time of need.
This article is furnished by California Casualty, providing auto and home insurance to educators, law enforcement officers, firefighters, and nurses.
It’s gift-giving season, but there’s no need to stress.
You’ve got first-rate ideas that are sure to impress.
Just take a pause before filling your cart,
and consult this short blog for an awesome head start.
Give one and give all, with forethought and reason.
Use these clever ways to save money this season.
1. Make a list and check it twice.
The more people you have on your holiday list, the more money you’ll spend. That’s why narrowing down your list of gift recipients is a good first step.
Write down the names of all the people on your gift list.
Take a second look at the list. Is there anyone you can delete, or move to a card-only list? Adjust the list as necessary.
Then, for each name, write down the person’s hobbies/interests.
Write down 1-3 possible gift ideas and their approximate costs.
Total up the list, and compare it to your holiday gift-giving budget in #3. You may need to adjust gift-giving expectations.
2. Limit the number of people you buy for.
You may want to buy for everyone on your list but there are creative ways to limit the number of people, and still cover everyone.
Whether in a group of friends, coworkers, or family, draw names and set a price limit. That way, you only have to buy for one person.
Do a white elephant gift exchange. Everyone brings one wrapped gift. People take turns choosing a present and opening it. They may keep their gift or “steal” someone else’s gift. The last person to go has the choice of any gift in the room.
Give a group gift. Connect with your siblings to contribute to your parents’ gift. Or give one gift to a family that everyone will enjoy.
Skip all the adults and just give to the children. This only works if everyone agrees; otherwise, you will have some folks showing up with gifts, which could be awkward.
Americans will spend an average of $832.84 on gifts and holiday items this season. You may spend less—or more. Keep to what you can afford by putting together a gift-giving budget.
Decide how to split the budget among your gift recipients.
Keep the budget with you, on your phone or in your purse or wallet, so you can reference it throughout the holiday season.
Not sure what to budget? Look at your credit card statement from last year and see what you spent on gifts.
4. Shop around.
You could buy items at full price or you could buy them on sale. Find the best deals by shopping around, finding discounts, and using cards and sites that give rewards.
If shopping online, look for free shipping. There’s a free shipping day in mid-December, and many retailers participate.
Many stores offer discount codes during the holiday season and additional discounts for teachers, students, veterans, military families, seniors, nurses, and first responders. Look for or ask about discounts that apply to you.
5. Buy second-hand items or make your own gift.
Not only are gently-used gifts sustainable, but they are also much less expensive than buying new. So is making your own gift. However, you’ll want to give it to the right person. (Not everyone appreciates a thrift store or homemade present.)
Second-hand gifts can be very thoughtful. You can gift family heirlooms or your own special item.
For the fashionista, hipster, or collector, thrift stores are a treasure trove of potential gifts.
Facebook Buy-Sell-Trade or Marketplace groups offer free and low-cost gift ideas.
Baked goods, candy, and cocoa make wonderful holiday gifts. Put it in a decorative tin or basket to make it festive.
Skip the expense of gift wrap with your own homemade version. You can be creative with items you probably have around the house.
Substitute any of the following for wrapping paper: butcher block paper, newspaper comics, and black paper with drawings done with a white paint marker.
Use shredded colored paper to cushion gifts in boxes and gift bags.
For extra-large presents, a plastic tablecloth works well as gift wrap.
Use old cards cut with pinking shears for your gift tags.
Remember to save this year’s bows, ribbons, and wrap for next year’s presents. Wind the ribbon around old wrapping paper tubes.
Pro Tip: To freshen wrinkled bows, put them in the dryer with a damp washcloth. Run the machine on the delicate cycle for 2 minutes.
7. Choose a less gift-focused holiday.
Talk to your family and friends sooner rather than later if you’d prefer to focus less on the gifts and more on the spirit of the holiday season.
Consider making a joint donation to a favorite charity instead of gift-giving.
Volunteer together over the holidays.
Give the gift of your time. Babysitting, a home-cooked meal, and even cleaning out the basement are all wonderful ways to show you care.
Plan a family trip or experience instead of giving actual gifts
Looking for extra cash for holiday gifts?
Some insurance companies allow you to skip payments around the holidays. At California Casualty, you have the option to skip your auto insurance payment for three whole months. (You also have this option to skip in the summer.) Ask your agent for details.
Happy holidays from all of us at California Casualty!
This article is furnished by California Casualty, providing auto and home insurance to educators, law enforcement officers, firefighters, and nurses. Get a quote at 1.866.704.8614 or www.calcas.com.
If your bill at the grocery store is higher than you’d like, you’re not alone. The average cost of groceries is 13% higher than this time last year. A family of four can spend as much as $932 on their monthly food bill…
Fortunately, there’s something you can do about it. From how you pay for groceries to where and when you shop, here are our top tips for saving money on groceries and feeding your family on a budget.
1. Redefine dinner.
Who says that dinner has to be a three-course affair with meat, veggies, a starch, and a dessert? Take the pressure off and serve breakfast for dinner a few times a week. Omelets are a relatively inexpensive meal and very filling. You also can have soup and sandwich night or a big salad. Be creative. Try going meatless to save money or adding beans to ground beef to increase the amount of food. Put shredded chicken over a soup, salad, or pasta and you’ll use a lot less than when serving pieces of chicken.
Pro Tip: Plan to cook so that you definitely will have leftovers. It’s easier and often cheaper to make a large portion than to plan a whole new meal with new ingredients.
2. Make a list and actually stick to it.
Make a meal plan for the week so you know exactly what to put on your shopping list. Pre-planning cuts down on impulse purchases, which can put you over budget. Then shop only for those items on your list. To help stick to your list, always make sure to eat before shopping,
3. Raid your pantry.
When meal planning, remember that you likely have plenty of food at home that you can incorporate. Look through your pantry and see if you can create a recipe around the food that is there. Check your freezer too. That way, you may just need a few items on your list to create some delicious meals.
Pro Tip: Check out websites that can help you build a recipe with ingredients that you already have like MyFridgeFood or SuperCook.
4. Sign up for the store’s loyalty program.
Most grocery stores offer loyalty programs that are free to join. You can get discounts automatically deducted at checkout. If you’re not on your store’s program, sign up the next time you’re there.
5. Clip coupons and look for sales.
Look at the weekly circular in print or digitally for sales, and clip/save coupons for the items you use. Digital coupons can even be loaded directly onto your loyalty card. Remember to do the math, however. Not all sales are the same good deal. Look at the unit price per ounce to compare the costs of different brands. Plus, if you’re not sure that you’ll use it, don’t buy it. Spoiled fruit in the garbage is the same as throwing away money.
6. Buy store brands.
The cost of store brands is usually 20-25% less. Try them out next time and see if you notice enough of a difference to justify buying the name brand. If you can’t buy all generic brands, at least try store brands for staples like salt and sugar.
7. Avoid pre-made items.
Convenience comes at a price. That means if something is prepared for you, you’re likely paying more for it. When you’re shopping, try to find food closest to its natural state. Buy block cheese instead of shredded cheese, and a box of pasta rather than a heat-and-eat variety. Snacks are some of the priciest items to buy. You can really save a lot here if you prepare them yourself.
8. Tally as you go.
Use the calculator on your phone to add up your order as you shop. You’ll be less likely to add items this way, and there will be no surprises when you get to the checkout. It might cause you to think, “do I really need this?”
9. When you shop matters.
Shop midweek when many grocery stores restock their shelves. That’s also when they change the discounts. If you’re lucky, you’ll get the price cut from last week’s sale. If you’re looking for clearance specials, shop first thing in the morning – or right after a holiday. If you’re looking for specials in the bakery, deli, or prepared foods section, shop right before closing. Many supermarkets mark down their rotisserie chickens, for example.
10. Pay with a rewards credit card or cash.
You might as well get some cash back when you shop. Pay with a grocery rewards card and you can automatically see some savings. Or if you can, pay with cash. Bring only the amount you want to spend, and when the cash runs out, you can’t buy anything else.
11. Compare prices at different stores.
Compare prices at different nearby grocery stores. Switch to a store that’s known for more affordable food prices like Walmart, Aldi, or Trader Joe’s. Even Dollar Tree has grocery items. Or you can join a wholesale club like Costco or Sam’s Club. These stores stock items in bulk at often lower prices. You’ll have to spend more upfront but you’ll save in the long run. That might not be for everyone but it’s a good value for large families.
12. Use a rebate app.
Sign up for apps like Ibotta and Rakuten. They give you cash back for buying groceries, among other items. Stores pay these apps a commission for sending them your way. Find out which apps link to your grocery store to make sure that they are an affiliate partner.
Happy shopping!
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