To save money on car insurance, you should understand how car insurance works. The cost of car insurance depends on many things, including your age, where you live, the car you drive, and your driving record. When you purchase car insurance make sure the agent knows if you have a clean driving record, because some companies give discounts to drivers who have no points on their licenses.

Insurance policy rates vary enormously from company to company. You can also save money by shop around among insurance companies and get the best rates. If you have two cars, you can probably save money by insuring both vehicles with the same company.

Some insurance company also offers a “pay as you drive”" policy. You can save a lot of money from this insurance policy if you are infrequent drivers. The lower your mileage, the lower your premium you should pay.

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Ideally, you should put away about 10 percent to 15 percent of your income for savings and investment before you take care of your other obligations. That’s nice, but for some people who are just beginning to save, 10 percent is considerably more than they can afford, so they get discouraged and don’t save anything. If you cannot save 10 percent of your income, you can at least save 1 percent and gradually increase your contribute.

The first time of saving habit is the most difficult, especially if you’re young and not making much money, but after a while you won’t even notice. The key is to stay disciplined and adhere to your plan.

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