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Could pay-per-mile insurance save you big bucks?

Published: Thursday, May 10, 2018 @ 2:00 PM

Looking for a new way to save money on your auto insurance?

If you live in a metro area and don’t have too extreme of a daily commute, you should check out the world of pay-per-mile insurance.

RELATED: How to get a cheap rental car — Clark Howard style!

Don’t put a lot of miles on your car? Check out this insurance!

You’re already used to the traditional insurance model, but there’s a new option out there that’s worth a look. It’s called pay-per-mile insurance and the leader in the field right now is a company called Metromile.

The basic idea with pay-per-mile insurance is that you pay a base rate each month and then also a per-mile rate on top of that.

In the example given below, the per-mile rate is set at 3.2 cents/mile.

Metromile says it sets your base rate by factoring in your age, credit history (state specific), type of vehicle, driver history and length of prior insurance (also state specific).

“It’s great for people who drive under 200 miles a week, which happens to be 65% of U.S. drivers,” Metromile CEO Dan Preston says in a video.

And here’s the nice thing: You won’t be charged for the miles you drive above 250 a day (150 in New Jersey). So you can still take all the road trips you want!

Metromile is currently only available in California, Illinois, New Jersey, Oregon, Pennsylvania, Virginia and Washington. You can join the wait-list to be notified when it becomes available in your state.

The Metromile Pulse is the key to pay-per-mile insurance

Your mileage is monitored with a telematics device called the Metromile Pulse that plugs into you OBDII port — a common feature on most cars that are 1996 and newer.

Now, you may be sitting there saying, “Wait, isn’t this the same thing that Progressive’s Snapshot does? Or that Allstate’s Drivewise or State Farm’s Drive Safe and Save program does?”

Ah, but there’s one big difference!

Unlike those services, Metromile says its pay-per-mile business model doesn’t focus on how fast you drive or how hard you brake. They just keep a tight focus on your odometer reading.

You can also keep track of your trips using the free Metromile app on your smartphone. The app includes features like a car locator and street sweeping alerts for in-town drivers.

We should note that the GPS in the Metromile Pulse will share location-based data. That data is not necessary for calculating your rate, so be sure to turn off the location-based data sharing if you’re concerned about privacy issues.

A few other services out there that are similar to Metromile include Milewise through Allstate and Esurance Pay Per Mile, which is also owned by Allstate. The Esurance option is only available in Oregon at this time.

Add-on coverages

Metromile offers both liability protection and comprehension and collision coverage, like traditional insurers.

And like the mainstream players, the company also offers add-on coverages you can elect to include in your policy for a fee.

Chief among these is roadside assistance — which includes fixing a flat tire, lockout and/or towing.

Before you jump at this extra, consider money expert Clark Howard’s warning about why you never want to use roadside assistance from your insurance company.

His preferred alternative is for you to get roadside assistance from AAA or an emergency roadside assistance app like this one.

Another add-on that’s available to Metromile customers with comp and collision on their policy is rental reimbursement. With this add-on, you can get up to $30 a day for up to 30 days if your vehicle is out of commission at a repair shop following an accident.

Meanwhile, one freebie that Metromile throws in if you have comp and collision is pet injury protection. Should your dog or cat be injured in a covered claim while riding in your vehicle with you, this coverage will pay you up to $1,000. (Void in Illinois and Virginia.)

Making a claim with Metromile

If you have to make a claim with Metromile, you can do the entire process right on your smartphone at claims.metromile.com or by calling 888-595-5485.

You have the option to use data from the Pulse device, and doing so can speed up the claims process. Metromile boasts that some claims can be resolved in hours.

To begin your claim, you will need the following info:

  • Policy number
  • Date of accident
  • Location of accident
  • Description of accident
  • Names of all parties and vehicles involved

If you have to make a claim while you’re in a rental vehicle on vacation, Metromile says that it will most likely be covered. And bonus: There’s no need to plug the Pulse in and you won’t be charged for miles in a rental vehicle.

So if you have comp and collision through Metromile, that means you can skip the expensive collision damage waiver (CDW) coverage that’s pushed at rental counters and can really run up the daily cost of your rental!

Canceling your Metromile policy

How to cancel your policy is among the top questions at Metromile’s Help Center, following basic questions about the Pulse device.

That’s probably because pay-per-mile insurance isn’t for everybody.

The good news is that if you want to try Metromile and later decide you don’t like it, canceling is easy for most customers.

If you’re a resident of California, Illinois, New Jersey, Oregon, Pennsylvania or Washington, simply call 888-244-1702 during normal business hours from 6 am to 6 pm PT.

However, residents of Virginia won’t find the cancellation process to be quite as straightforward. If you live in the Old Dominion state, Metromile says you’ll have to fill out the online contact form and wait to hear back to cancel.

Once you’ve canceled, be sure to mail the Metromile Pulse plug-in device back to the company within 30 business days. You can use the pre-paid envelope the company sends you. Otherwise, if you go past 30 days without returning, you will be charged a $100 fee.

Clark’s take

Money expert Clark Howard’s take on the pay-per-mile insurance model is simple — he loves it!

“Motorists who log mega-miles may cry foul about the idea of [pay-per-mile], but here’s how I see it: You already pay more for gas and maintenance, based on how much more you use your car versus a more casual-use motorist. So extending that idea to insurance seems to make perfect sense,” Clark notes.

More auto insurance stories on Clark.com: 

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Downtown Dayton office building/Table 33 home sells for $2.8M

Published: Tuesday, May 01, 2018 @ 2:08 PM

Dayton city garage maintenance worker Kevin Price points upward at the 130 W Second St./ 1st National Plaza in downtown Dayton in this 2001 photo. FILE
Dayton city garage maintenance worker Kevin Price points upward at the 130 W Second St./ 1st National Plaza in downtown Dayton in this 2001 photo. FILE

A downtown Dayton office building near the federal building sold for just over $2.8 million today, according to local property records.

Titan Loan Investment Fund L.P. is identified as both the buyer and the seller for the May 1 transaction at 130 W. Second St. in downtown Dayton, according to Montgomery County property records.

The transaction is a sale to an investor named Brian Lash, a new owner coming into the market for this building, said Katie Doup, a Columbus-area spokeswoman with  real estate firm CBRE. She said a fuller press release was being prepared now on Lash’s investment in Dayton and his plans. 

 MOREMaker of Gibson guitars declares bankruptcy

Doup also said a second announcement on the sale of another Dayton building may be forthcoming in the near future. 

The 22-story building at 130 W. Second was on sale with an asking price of $4.25 million, according to a LoopNet real estate listing. It offered a rentable building area of just over 326,000 square feet and was built in 1972.

Acadia, the Table 33 restaurant, IT firm DataYard and County Corp. are some of the building’s most notable tenants. 

Acadia moved to the building last year from Kettering. The company moved to 4,800-square-feet of offices in that building.

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6 tax mistakes procrastinators make and how to avoid them

Published: Thursday, April 05, 2018 @ 11:46 PM
Updated: Thursday, April 05, 2018 @ 11:46 PM

What Happens If You Don’t Pay Your Taxes

We get it. Doing your taxes is no fun, especially if you know you’re going to owe money. But as with any project on which you procrastinate, leaving everything to the last minute can lead to errors, both large and small, and some of those errors could cost you serious money.

If you’ve gone and done it, though, and are still looking at that pile of tax forms over there in the corner, we’ve compiled a list of six quick-and-dirty tips that could keep you from making some obvious, and not-so-obvious, mistakes when you finally sit down and tackle the task. They could also help you maximize your tax refund.

1. You Forgot to Sign It

You might wonder how anyone could forget to sign their tax form, but this simple process is one of the most common tax mistakes, according to the IRS. Just like forgetting to sign a check or a contract, it means your return isn’t valid. Usually, there isn’t a penalty or interest associated with this error (since you’ve already included a check or electronic payment if you owed), so the IRS will just send a notice asking for a valid signature, but it will delay the processing of your return. If you’re getting a refund, that too will be delayed.

So check, double-check — heck, triple-check — that you signed or completed the e-signature process before filing your return. Also, check out these last-minute filing tips from the IRS.

2. You Miscarried the 9

Math errors are also a very common mistake made by folks in a hurry. Fortunately for most people, the IRS corrects any miscalculations, so there’s no need for filing an amended return. But these mistakes can mean the difference between you thinking you’re getting a refund and the reality that you actually owe taxes, so be sure to check your calculations carefully.

One way to help you avoid math errors is to file electronically so the calculations are done for you. Bye-bye, No. 2 pencil! So long, calculator!

3. You Didn’t Account for All Your Income

Did you have a side hustle early last year? A freelance design gig for a friend’s business? If so, you’re going to need to account for it, regardless of whether you received a W-2 or 1099 from whomever paid you. That’s because, while there’s an IRS threshold for filing these documents by employers, there’s no similar threshold for claiming the income. Income is income is income. If you made money and don’t report it — and the IRS catches it — it’s going to cost you penalties and interest at best, and open you to a possible audit at worst.

4. You Forgot Deductions or Tax Credit

It’s easy to forget these things when you’re in a hurry, but they can end up saving you some serious money and are well worth the extra time to figure out if you qualify. So if you’re just claiming the standard deductions because you’re under the gun, you might want to take a deep breath and check out TurboTax’s list of 10 commonly overlooked tax deductions that can keep you from overpaying the tax man.

5. You Filed for an Extension but Didn’t Understand the Rules

Filing for an extension is a great idea if you’re down to the wire and don’t really understand your tax situation. But remember that an extension gives you an extra six months to file your paperwork, but not an extra six months to pay any taxes due. So, if you’re confused, tax pros recommend doing a quick calculation of your taxes, filing for your extension and making any required payment of taxes you think you owe. This will help you avoid penalties and interest once you get your final calculations together.

6. You Didn’t Bother to Request an Extension

You gave up. You shoved, slammed and jammed your return through and now it’s full of mistakes that are going to cost you money by way of penalties or because you’ve left money on the table. It’s a much better idea to file the extension, then get the help you need from a tax professional to ensure you’re not overpaying your taxes.

Whatever you do, make sure you file your taxes. Unpaid taxes can have serious consequences on your personal finances, including your credit scores if they go unpaid long enough.

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11 ways to reduce next year’s tax bill

Published: Thursday, April 05, 2018 @ 11:55 PM
Updated: Thursday, April 05, 2018 @ 11:55 PM

SAN FRANCISCO, CA - APRIL 14:  Liberty Tax Service tax preparer Ronn Seely works on tax returns on April 14, 2011 in San Francisco, California. (Photo by Justin Sullivan/Getty Images)
Justin Sullivan/Getty Images
SAN FRANCISCO, CA - APRIL 14: Liberty Tax Service tax preparer Ronn Seely works on tax returns on April 14, 2011 in San Francisco, California. (Photo by Justin Sullivan/Getty Images)(Justin Sullivan/Getty Images)

If you claimed the right number of dependents and standard deductions on your 2017 federal income tax return and you still ended up owing the IRS, you’re probably looking to avoid a repeat performance next year. Luckily, there are several ways to increase your chance for a refund (or at least reduce the amount you’ll owe) and you don’t have to be a tax whiz or accountant to take advantage.

Here are 11 ways you can pay less in federal taxes for your income return next year.

1. Contribute to a 401K or IRA

Contributing to a retirement fund is an important way to ensure financial independence in your golden years, but it can also convey short-term tax benefits. In most cases, the contributions you make to your 401K and IRA plans are tax-deductible and are not included in your taxable income at the end of the year. (Note: If you didn’t contribute to an IRA in 2017, you still have time. You have until April 17 to contribute up to the maximum amount and shave off a good chunk of your tax bill. Filed your taxes already? That’s OK. You can file an amended return to reflect the contribution.)

2. Buy a Home

There’s a distinct tax benefit to home ownership. The interest you pay on your mortgage is tax-deductible, and the interest is front-loaded. For the first several years, most of your mortgage payment goes toward interest, which will drastically reduce your adjusted gross income at tax time. Want an extra boost for your taxes next year? Consider paying January 2019’s mortgage payment in December to get a tax benefit before the end of the year.

3. Donate to Charity or Volunteer

You probably know charitable donations can be itemized and deducted from your income, so you’ll want to save receipts anytime you donate cash or items to charity. You can even deduct miles you travel for volunteering or other charity work.

“Miles you travel on behalf of a charity are deductible at 14 cents per mile for 2018,” said Gail Rosen, CPA.

4. Start a Home Business

Starting a home business can provide you with a new source of income and allow you to take deductions off any income the business generates.

These deductions include business costs you incur throughout the year, a portion of your mortgage and utilities if you use a home office and the cost of goods needed to keep your business running. You can even deduct startup costs.

“Any expenses that are incurred before the first sale are ‘start-up costs,’” Rosen said. “These costs cannot be deducted until the first sale. Then they are deducted over 15 years and you can deduct the first $5,000 in the first year.”

5. Search for a New Job

If you hunt for a new job in your field this year, you can write off some qualifying expenses as you search. There are exceptions, but potential write-offs include things like clothes or travel.

“If you looked for a new job in 2018, you should be aware of the income tax deduction that may be available with respect to job-search costs,” Rosen said. “Qualifying expenses are deductible even if they do not result in a new job being offered or accepted.”

6. Open a Flexible Spending Plan

Many employers offer flexible spending plans that let you contribute toward yearly medical expenses pre-tax. These contributions typically don’t count toward your taxable income.

7. Deduct Medical or Dental Expenses

Many medical and dental expenses are tax-deductible. According to Rosen, the cost of getting to and from medical treatment is deductible at 17 cents per mile, plus the cost of tolls and parking, and dependent expenses are also deductible.

“If you cover the medical cost of dependents, these can be deducted. Additionally, if you are covering the costs of an individual who would qualify as your dependent except that they have too much gross income — for example, an elderly parent — you may be able to deduct these costs as well,” said Rosen.

8. Education-Related Expenses

Current and former students have many eligible deductions and credits related to their education expenses. Paid student loan interest and tuition and fees can be claimed as deductions. Eligible current students can also access the American Opportunity Credit, which can cover up to $2,500 annually for four years, and the Lifetime Learning Credit, which can cover up to $2,000 per tax return.

9. Install Solar Energy

Homeowners who install solar energy systems in their home can get back tax credits at up to 30% of the cost of installation. This credit will begin to decrease after 2019 so you may want to act soon if you’re planning on installing solar panels.

As an added bonus, solar energy can significantly reduce your energy bills.

10. Hunt Down Every Available Tax Credit

We’ve named several tax credits above, but there are more, including credits for adopting children, the cost of child care and low-income households. Tax credits are more valuable than deductions, as they reduce your taxable income on a dollar-for-dollar basis, so make sure you’re taking advantage of every option.

11. Get a Pro to Do Your Taxes

No matter how much research you do, a professional may be able to identify tax deductions and credits that hadn’t occurred to you. Paying a reputable professional you trust can help you stay organized and minimize your tax liability. Here’s a handy guide to finding the right tax professional for your needs.

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5 surefire ways to retire earlier than you thought

Published: Monday, October 23, 2017 @ 11:27 AM

The following are five surefire ways to get to retirement quicker Set clear goals for yourself and track your progress Working hard and being disciplined is the most reliable ways to retire early Streamline your spending and scale back on luxuries Cut your housing expenses Put your money to work - wisely

Retirement can seem like a difficult goal to reach, so the thought of achieving it early may seem downright impossible.

But getting to retirement quicker doesn't require genius-level investing knowledge or extreme deprivation. With a plan, hard work and discipline, you may be able to get there sooner rather than later.

RELATED: House hunters, here are 5 secrets to getting the best home loans

The following are five surefire ways to get to retirement quicker:

Set clear goals for yourself

Consumer adviser Clark Howard recently shared advice from Chris Reining, who decided in his late 20s that he wanted to retire early. By the time he turned 37, he was able to reach this goal.

Howard said he thought setting clear goals was one of the most important things that Reining did. He labeled his investment account "Retire early" so he could see the words every day. In addition, Reining tracked his progress by using a spreadsheet you can get on his website. He wanted to save up 25 times his annual expenses before retiring.

(Getty Images/iStockphoto)

Work hard

The Forbes Finance Council recommends working hard and being disciplined as the most reliable ways to retire early.

This can be achieved through a high-paying job combined with saving as much of your income as possible. Another path is starting your own business.

Reduce spending

Forbes quotes a blogger who retired early and says that streamlining your spending is an important step toward achieving this goal. It's not glamorous or complicated, but it works.

He suggests scaling back on luxuries and investing your savings in a low-cost index fund. When you accumulate 25 to 30 times your annual spending in this type of account, you can quit working for the rest of your life.

This Wednesday, Sept. 6, 2017, photo shows a new home for sale in a housing development in Raeford, N.C. On Thursday, Sept. 21, 2017, Freddie Mac reports on the week’s average U.S. mortgage rates.

Cut your housing expenses

If you're like most people, your home is your biggest expense, so it's also your biggest opportunity to save, according to Money.

Housing costs take up about a third of the average budget, so Money recommends not taking out the biggest mortgage you can get. Live in a more modest-sized home when possible, and in some cases, homeowners can purchase a two-family home, living in one side and renting out the other.

Put your money to work - wisely

CNBC talked to Scott Alan Turner, who had more than $70,000 in debt at age 25, yet managed to turn things around and retire by age 44.

He put his money to work and although he made some mistakes in the beginning, he evolved into what he calls a boring investor. His savings are automatically funneled into low-cost index funds, which Warren Buffet calls a surefire way to build wealth.

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