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Leslie Kasperowicz holds a BA in Social Sciences from the University of Winnipeg. She spent several years as a Farmers Insurance CSR, gaining a solid understanding of insurance products including home, life, auto, and commercial and working directly with insurance customers to understand their needs. She has since used that knowledge in her more than ten years as a writer, largely in the insuranc...

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Joshua is a copywriter at Obrella who for more than 10 years has been creating content about insurance, health care, and more. He helps companies explain complex insurance subjects in simple ways so that customers can make smart buying decisions. He spends way too much time binge-watching Netflix, loves the outdoors and has a cat who tolerates him.

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Reviewed by Joshua Adamson

UPDATED: Mar 23, 2016

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Saving Money on Car Insurance in your 20’s

College student with folder, money, and warm clothing

My 2001 Subaru Outback took me everywhere; from the grocery store to camping trips, to and from various dates, to college when I moved out at 18,  even from coast to coast and on several other road trips. Needless to say, Dona, was more than a car, she was a friend.  So you can imagine the heartache I experienced when she broke down on me in the middle of a busy city street and I was forced to push her (with the help of some very kind strangers) to a nearby parking lot and leave her to find help.

This was a pivotal moment for me in my 20’s.

Before this moment I hadn’t acquired any large expenses or debt; Dona was a hand-me-down from my parents, I was blessed with scholarships to cover most of my college and my parents covered my living expenses.  I never had to think about large costs like buying a new car and insuring it.  I was feeling overwhelmed by all the options.

Statistically, people in their 20’s are more accident prone than any other age group (yep that includes teenagers) and this can make the car insurance cost for people in their 20’s skyrocket.   And I don’t know about you, but car insurance rate comparison wasn’t on my mind until it had to be.  But you don’t have to worry.  There are plenty of ways to save money when you buy car insurance to bring down the costs that you will inevitably face in your 20’s.

Buy the Right Car

Cars are often show pieces.  People want their cars to be a representative of themselves and the lifestyle they either have or want to have.  Unfortunately that can get pretty pricey, and when you are in your 20’s you probably shouldn’t put yourself in financial strain over a mode of transportation. The cheapest cars to insure are generally older and used models as well as cars that are statistically safer.  You should avoid sports cars and cars with larger engines like V6 or V8’s, which will raise your insurance rates, partly because they are more expensive to repair.


So maybe you have looked around at safer, used cars that would be cheaper to insure and you are weighing your options about which one to buy and it can often times come down to the price.  Cars are expensive purchases and are always finding ways to take your money through maintenance.  If you want to save money on your car insurance you should budget for it in the type of car you decide to purchase.

There are lots of ideas about the best way to budget for a car but a good rule of thumb to follow is between 10% and 25% of your income.  If you’re a very frugal person and just want a car that can get you from place to place then 10% might be the ballpark area for you to strive for.  However, if you want a little bit of a newer car that requires less maintenance then I would ballpark about 20%.  Factoring car insurance cost into your budget will help you pick the right car.

Shop Around

I like familiarity; I use the same brands of cooking supplies my mom buys, I order my favorite item off of menus I’m familiar with, I drive the same way home every day, and if I continue with this pattern then I’m going to want to buy the same insurance that my parents have because I still believe that mom’s brands are better.  However, when you are looking for a policy, the one that worked for your parents or your friends may not be the best option.

There are many policies that reward safe driving, taking alternative forms of transportation, good grades for students, and even certain professions.  The most important thing you can do is your research.  Being better informed will give you leverage in negotiation with insurance companies and you can come prepared to get the best car insurance ratings possible.


Your 20’s are full of lots of big decisions, not just buying a car.  Multi policy discounts or bundles are just another one of the techniques insurance companies use to get more of your business but they are actually great for the consumer as well!  Bundling different forms of insurance together can get you great discounts on big purchases you will probably be making anyways.  Auto insurance, home insurance, health insurance, life insurance and multi-car insurance can all be bundled together depending on the insurance company and it will cut down the cost.

Another way to save is by paying your cost annually or semi-annually if you can.  Paying in lump sum will take a lot of the cost of interest out of your insurance bill and you only have to worry about it once or twice a year.  If you can’t pay lump sum, make sure you are paying on time because insurance companies will charge you late fees that can add up very quickly if you aren’t careful.

Get an Annual Checkup

Life, along with insurance rates, are always changing.  This is why you should go in every year to get a checkup on your policy.  Talking to your insurance agent each year can help you continue to get the best possible price.  And because your 20’s are such a time of change, you may want to increase your policy if you get promoted and start making more money, you may qualify for discounts if you get married, and you can make sure to remove any unnecessary policies that you paid for the year before but didn’t really need.  If you feel like you’re a safe driver and don’t anticipate many accidents with you at fault then it may also be a good idea to also select a higher deductible.  Higher deductibles will make the price of your insurance cheaper, however, if you get in an accident then you will end up paying more money out of pocket.  But annual checkups will let you reevaluate your driving habits and your car insurance cost doesn’t have to be outrageous especially as you navigate through your 20’s.

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