Money Management

Not reading the insurer’s reviews was a huge mistake. 

Last year, my husband purchased some insurance for his business. He bought the policy on the recommendation of a new insurance agent who we had never worked with before. Unfortunately, this ended up being a huge mistake — and one that we would have been able to avoid had we done one simple thing before purchasing the coverage.

Here’s the huge error we made when getting covered.

This insurance mistake came back to bite us

When buying coverage, we trusted the agent to pick a good insurer for us. We then charged the premiums for the policy on our credit card without looking deeper into whether the insurance company was actually good.

Specifically, we neglected to read reviews of the insurer. Had we done so, we would have seen that the insurance company had just a 1.05 star rating on the Better Business Bureau website, and we would have seen that there were a number of complaints about the insurer online.

Had we read about these issues other customers had with the insurer, we would have taken another look and most likely found a different insurance company to get coverage from. But instead, we paid the insurer a premium for the whole year upfront and got our policy in place.

The insurer has caused us nothing but problems

Around 10 days after signing up for coverage and paying our annual premium, we decided to cancel the insurance policy and switch to a different carrier. There were a number of reasons for that, including the fact the insurance company had been slow to answer some questions we had upfront, and the fact that we found a better deal by bundling the coverage with some other policies.

When we had previously canceled insurance policies mid-year after paying an annual premium, we received a check back from the company in a timely manner refunding us for the extra premiums we paid. That did not happen this time. In fact, the insurer gave us the runaround and kept refusing to send our premium payments.

Because of the difficulties we faced dealing with the insurance company, we ended up disputing the premium charges with our credit card company — which sided with us and reversed the charges. Then the insurer started sending us notices that we had to pay the remaining premiums or we could face collections, despite the fact we had canceled the coverage almost immediately.

We’re still trying to resolve the issue months later, and we will never again purchase insurance coverage without making sure the company has a solid reputation for customer service.

This taught us an important lesson: It’s really important whether an insurer treats customers well or not. I’m just glad we’re only dealing with an issue of a premium refund and not trying to get a claim paid by the insurance company. I can only imagine the hassle we would have faced had we actually been trying to take advantage of our coverage.

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We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.

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You might as well get the largest payday you can. 

If you’ve been following the news, you may be aware that a number of well-known companies have announced layoffs this year. In fact, USA Today recently reported that since the start of 2023, tech companies have laid off almost 95,000 workers, according to data compiled by Layoffs.fyi.

But even if you don’t work in the tech field, you can’t discount the possibility of a layoff. And if your job ends up on the chopping block, it’s important to know how to negotiate the severance package that’s presented to you.

One thing you should know is that not all companies offer severance packages. And unless it’s written into your employment contract, they generally don’t have to.

But if you are on the receiving end of a severance deal, it’s important to try to make the most of it. Here are some tactics worth employing in that situation.

1. Don’t sign that paperwork right away

This may be a little-known fact about severance agreements, but it’s generally in your company’s best interest to have you sign one. These agreements typically state that you’re not allowed to disparage your employer in any way or otherwise risk financial penalties. And in exchange for agreeing to such terms, you can walk away with what could be a decent payout.

But the longer you go without signing a severance agreement, the more leverage you might gain. That could make it easier to negotiate with your employer.

2. Make sure you’re getting paid for unused paid time off

Your severance agreement might come with a lump sum payment you’re eager to stick in your savings account. But the more money you’re able to squeeze out of your employer, the more financial breathing room you’ll have as you look for a new job — and the less likely you’ll be to rack up a credit card balance while you’re out of work.

Now, your employer might offer you severance pay equal to a certain number of weeks of salary. But on top of that, make sure that any unused vacation time you’ve accrued is time you’ll be getting paid for. If your company tells you their standard practice is to offer severance equal to four weeks of pay, but you have 10 days of vacation time you accrued but didn’t use, ask for six weeks’ worth of severance.

3. Consult an attorney

Chances are, your company has a legal team that put together its severance package and agreement. To level the playing field, you may want to consult an attorney of your own. A professional who has experience with employment law can tell you if your severance package is fair, and can also alert you to rights you may be signing away but shouldn’t.

Also, once you get a lawyer involved, your employer might realize you truly mean business. They may be willing to give you more money to wrap matters up as quickly and painlessly as possible.

Being laid off from your job can constitute a huge blow. And so it can be difficult to take a level-headed approach to negotiating a severance package. But if you push through the mental upheaval, you may find that you’re able to walk away with a much better deal than the one your employer initially offers. And that could help ease the sting of a layoff to some degree.

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We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.

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An HSA could benefit you down the line, even if you don’t have many healthcare bills today. 

Healthcare can be a big expense at any age, so it’s important to have money set aside to cover medical bills. But you don’t necessarily have to limit yourself to a savings account for that purpose. In fact, if you’re enrolled in a high-deductible health insurance plan that’s compatible with a health savings account, or HSA, then it pays to participate in one.

The money in your HSA can be used to cover a wide range of healthcare expenses, from medical copays to eyeglasses to orthodontics for your kids. But if your health is great, and so is that of your family, then you might think you shouldn’t bother with an HSA.

After all, why set money aside for healthcare expenses when you don’t anticipate having many in the near term? But because of the flexibility that HSAs offer, it pays to open and fund one even if you don’t expect to spend money on healthcare anytime soon.

You can benefit from an HSA down the line

If you’re familiar with flexible spending accounts (FSAs), you might know these plans require you to spend your plan balance year after year or risk forfeiting funds. HSAs work differently, though.

With an HSA, you can carry your money forward indefinitely, all the while investing funds you don’t need to use right away. This means you can fund an HSA this year, and even if you don’t incur any medical expenses, that money won’t disappear on you. You’ll have the option to carry it forward — all the way into retirement even. And at that point in life, when your healthcare costs are likely to climb, having a pile of medical savings could come in really handy.

Do you qualify for an HSA?

The one drawback of HSAs is that they’re not open to everyone. To participate in an HSA, you must be enrolled in a high-deductible health insurance plan, and the definition of what that is can change from one year to the next.

In 2023, your plan is considered HSA-compatible if you have an individual deductible of $1,500 or more, or a family deductible of $3,000 or more. Your plan’s out-of-pocket maximum also cannot exceed $7,500 if you have individual coverage, or $15,000 for family-level coverage.

But if your plan renders you eligible for HSA contributions, it pays to make them. Those contributions, like FSA contributions, will go in tax-free. Then, if you invest your money in an HSA, gains in your account will be tax-free as well, similar to the gains in a Roth IRA. And HSA withdrawals are always tax-free as long as that money is used for qualified healthcare expenses.

You may not need the money in your HSA anytime soon. But chances are, you’ll need it down the line. And at that point, you’re apt to be very grateful for it.

Also, while your health (and that of your family) might be excellent right now, accidents can happen at any time. You never know when you might get hurt and land in the emergency room with a $1,500 bill to tackle as a result. So even though you might think you won’t need your HSA funds anytime soon, you may be unpleasantly surprised to wind up tapping that account earlier than planned.

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We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.

 Read More