Decreasing Expenses // Can Car Insurance Discounts Make a Difference?

In order to gain wealth, you need to increase your income or decrease your expenses–or both. 

I am pretty limited in terms of increasing my income. My pay scale as a professor is set. Our union negotiates a contract every 3 years and in that contract is our pay raise. Beyond that, if I want to make more money via my employer, I need to teach more classes or take on more projects. I struggle finding enough time to take care of myself and do personal projects that I love– like this blog, home improvement work, and knitting–so I choose not to take on extra work. 

There will likely come a time when I develop a lucrative side-hustle, but right now, my focus is on spending wisely. 

My family uses 2 services I think we pay too much for–the internet and phone. I got my internet down from about 90 a month to about 60 a month by changing companies. I’m currently working on doing the same for the phone. 

Though I don’t think my family pays too much for car insurance, I know that State Farm has had a discount for low-mileage drivers in the past and we’ve been driving a lot less since the pandemic hit. Hence I gave them a call.

I found out that yes, State Farm still has a discount for those driving under 7500 miles per year. You read that right–7500 miles a year. That’s amazingly low mileage. My husband’s commute is about 4 miles each way, and right now he’s working 4 days a week. I run most of the errands so I was pretty sure his mileage would be low. 

Would it be low enough for the discount? 

Because I don’t randomly write down mileage for our cars, I had to look at some receipts for our oil changes and other work we’ve had done on the car. My mechanic records the mileage of our vehicles during repair.

On 5/9/19, my husband’s odometer read 51,526. On 6/29/20, a year and a month later, it read 56,132.

That’s 4606 miles–much less than 7,500 miles last year. Yup. We got that discount!!

Now for my car. I drive 5 miles to work each day, Monday through Thursday and some Fridays. I drive my step kids around town a bit. I put on the most miles, though, when I visit my parents in Chicago. It’s about 130 miles each way, and I usually drive while I’m there, so I usually put on 300 miles per visit. 

I used to drive up to see my parents about once a month when I was single. Since I’ve been married and want to stay home with the step-kids every other weekend, I visit less often.

I never got the low-mileage discount before, but I thought I’d check anyway.  It looks like my mileage at 2/8/19 was 85,540 and on 3/9/20 it was 90,871 so in a little over a year, I went 5331 miles. That is way under 7500 miles! 

How much will we save? We currently pay about 550 every 6 months, so 1K to 1100 a year for both cars. Due to the low mileage discount we’ll get 68 off per year for my husband’s car and for my car we’ll get 46 dollars off per year. 

That’s about $5 off a month for his car and about $4 off a month for mine. That is very little. I am kind of disappointed that the discount isn’t larger.

I also found out, though, that State Farm is giving a 25% discount for the payments made from March through May due to Covid-19. My husband’s car will get $29 credit and my car will get $20 credit. Still not huge, but I’ll take it.

Over the next year, then, we’ll save 68 + 46 + 29 + 20 = $163. My Civic is 11 years old, and though I’d love to keep it forever, I’ll likely need a new car within the next decade. That $163 will go into my car fund.


Is my savings worth the time it took to look into it?

If I were only considering the financial savings, I’d say no. It took a bit of time and energy to look up my car mileage and articulate my questions before the phone call. I also don’t love calling my insurance company. Though the reps are always pleasant, they often try to sell me something and this time was no exception. One hundred fourteen dollars isn’t nothing, but it also isn’t a huge savings for a year. (We’d have gotten the Covid discount whether I had called or not).

What makes the work worth it, though, is that I feel empowered when I look after how I am spending my money. I enjoy being able to understand the insurance and the discounts and it’s good practice for me to ask for them. 

In the future, I want to research the cost and benefits of comprehensive and collision coverage to determine whether I will want to drop that coverage when my car is worth less. Having done the work of calling my agent this time will help me feel more comfortable next time.

Peace Out (& In),




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