Everyone's Doing It!
We are all guilty of wasting money on products that seem like a good idea but just don’t live up to our expectations or deliver on what they promise. Here are eight financial products that are a waste of money, according to Consumer Reports.
Collision Insurance on Older Vehicles
Collision coverage only reimburses drivers the worth of their car, so at some point the cost of the coverage is equal or more than the maximum amount the policy would pay on a claim. According to Consumer Reports, you can save up to $300 a year if you set aside money each month and self insure your car.
Load Mutual Funds
Load mutual funds take 4% to 6% of your investment to cover sales commissions. If you research, and compare funds by type and rating, Consumer Reports claims you can save between $200-$300 on an initial investment of $5,000.
Many times, service plans on big-ticker purchases will cost more than you'll recover. If you buy dependable products and follow the manufacturer's usage and maintenance recommendations, you can save between $30 to a few thousand dollars, according to Consumer Reports.
While the financial crisis has caused some banks to eliminate free checking to cover costs, there are still plenty of banks that offer no-fee checking accounts. Consumer Reports says you can save between $36 and $600 if you research deals at credit unions and local and national banks.
Payment protection will cover your minimum payments for a set amount of time or eliminate credit-card debt in extreme circumstances like unemployment, disability or death. However, Consumer Reports says it eats up 18 cents to $1.35 for every $100 of debt.
Most basic health insurance plans cover disease and cancer insurance may cancel out or duplicate coverage you might all ready have. If you check to see what your health policy covers you might save yourself between $200 and $3,000, according to Consumer Reports.
Identity theft is a growing problem in our increasingly digital world, but companies that promise to secure your identity don’t always deliver on their promises. Consumers should be proactive in protecting their identity. If you expect foul behavior, place a security freeze on your credit reports at all three major credit-reporting bureaus. According to Consumer Reports, taking steps to protect your own information can save between $120 to $240 a year.
Cell Phone Insurance
Read the fine print when agreeing to purchase cell-phone insurance as they are often riddled with exemptions. Check your home and auto insurance policies to see if your phone is or can be covered. You can save between $48 and $96 a year, says Consumer Reports.
Consumer Reports details eight financial products that aren’t worth the money.