First off, congratulations! Hopefully by paying off your vehicle or home you’re one step closer to being debt free.
While the loan may be satisfied there are still other items that need your attention. Here are 3 things to do now that you’ve paid off your car or home:
- Contact Your Insurance Agent. When you finalize your payment requirements for your loan it’s up to you to notify your insurance carrier. Credit unions, mortgagees, and banks (even local ones) will not contact your insurance carrier to be removed from the policy. That falls on you. It’s a small task, but it can help avoid a bigger problem down the road.
- Review Your Insurance Coverages. According to lendingtree statistics, the average auto loan length in Q1 of 2019 was 69 months! Now that your car is paid off do you still need full coverage? Or would lowering your deductibles help save on the rate? Now that enough time has passed do you need to increase your liability limits? The point being that there are many benefits by reviewing and updating your insurance policies.
- Consider Paying Your Insurance Policies In Full. With the extra monthly payment gone it’s a good idea to look at other ways to save on your insurance policies. Your homeowners insurance is already calculated on a paid in full basis if it was previously mortgagee billed. If you elect to put it into payments that will increase the rate. Many carriers, including Progressive, Travelers, Safeco, and Grange, offer discounts for paying your policies in full. Paid in full discounts can even be up to 20%!