5 Financial Nightmares You Need To Avoid

5 Financial Nightmares You Need To Avoid

Maintaining a budget is hard enough without any of these 5 financial pitfalls blowing up your finances and dragging you to financial ruin.

1. The Insurance Trap

Problem:Getting caught up in the confusing world of insurance often puts consumers in the hot seat when it comes to protecting their finances. With so many advertisements on TV and the Internet, most people just end up sitting on a policy that only serves to bleed them dry when it comes time to pay the bills. Insurance companies want their customers to sit on that fine line between complacency and frustration that keeps them paying too much for too little.

Solution:Online insurance shopping sites are narrowing the gap and making it easier for drivers to find suitable policies with high caliber agents. If you’ve never used one before you may be surprised at how many quotes you receive that are lower than your current price. For example, InsureMyCar4Less is the leading site online that provides an effective solution to drivers looking for a quick and secure way to keep their bills lower while maintaining the protection levels for their cars. Curious to see what you should actually be paying? Check out a comparison site like the one above to learn more.

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2. The Email Scammer

Problem:A Nigerian Prince, an unfamiliar distant classmate and a guy claiming you won a random lottery walk into a bar, and immediately demand money and personal info from you. Emails from characters on the web like this are incredibly common, and for the most part easy to avoid. The exist for a reason though, and that’s because at the end of the day email scammers are able to make money and some of them are more clever than you would think.

Solution:Stay diligent when reading your email. If you don’t recognize the sender, avoid opening the email. If there are typos or the images look like they were copy and pasted from a word document out of 1999, approach with caution. Many of these emails will have small tidbits of your personal information to make you feel like they are familiar with you, but don’t let that fool you. Just because they know your name and even your address doesn’t mean they are a legitimate company. Finally, if it is in your spam filter then it should probably stay there.

3. Hidden Fee Salesmen

Problem:At one point or another we have all been handed a bill and thought, “Wow, I did not expect that!”. Once a service has been provided, some companies will tack on additional services you weren’t aware you had to pay for until it was too late. This isn’t just services either, some “Free” memberships may have activation fees, maintenance charges and other ways that are designed to hook you in and then make you pay.

Solution:Don’t pay a dime for what you don’t want. If a bill for a car or home repair job comes your way and there are charges you weren’t made aware of, let them know you won’t be paying for those. You should pay only for what was agreed upon and discussed before and during the job. People often forget that the customer is the one with the power, so it is up to you to show them they cannot get away with hidden fees when working for you.

4. Online Auction Rip-Off

Problem:Ever since Ebay went off and made millions, hundreds of companies popped up looking to get a slice of the action. The downside is that these some of these companies will do anything to get you to spend money with them. Some require a credit card on sign up to access their “premium” deals. Others require microspends to bid with the promise that you what you want for a fraction of the cost. Many of these sound too good to be true, and most of them will end taking your money and leaving you in the dust.

Solution:Avoid any site asking you to make a deposit or put money into an account in order to shop on their site. No matter what they say, these sites don’t exist to serve you great deals but rather take your money when you aren’t looking. Also be sure to read the fine print, many sites that say they are free often have a “$30.00 registration fee after 1 month” that will automatically take your money if you don’t cancel. You would never pay to enter the mall to go shopping, so don’t do it online either.

5. Auto Repair Racket

Problem:Some auto shops tend to take advantage of the fact that we often have no idea what they are doing under the hood of our cars. The will show you a dusty air filter and say it should be replaced immediately. They will ask if you want to upgrade to the premium oil filter that your car desperately needs in order to run smoothly. The reality is that your car will do fine with the standard filter, and that dirty air filter they are showing you may just be one laying around the shop that they show to everyone.

Solution:Read up on car repair. The internet is a wonderful place to find out the honest numbers behind how long you need to change out parts on your car. A little bit of knowledge goes a long way with your vehicles.

For larger repairs, such as accident and collision damage be sure that your insurance is up to date to avoid additional problems. You shouldn’t be paying hundreds of dollars a month only to have your insurance fail you when you need it most. Check out sites like InsureMyCar4Less to get a quick update on the best insurance coverage out there to make sure you are up-to-date on your automotive protection.