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Congrats, new driver: Hitting the open road on your own can mean freedom and just plain fun. But remember that safety comes first — and part of driving safely is having sufficient car insurance coverage.

The world of auto insurance can be confusing, especially for new drivers, who also often face the challenge of higher insurance premiums. Still, there are ways to save money on insurance, both right off the bat and as you spend more time behind the wheel.

Here’s what new drivers need to know about auto insurance.

Car Insurance: The Basics

First things first: What is auto insurance, how does it work and why do you need it?

Car insurance pays out money for car repairs, medical bills, and other expenses in the event you get in an accident. Liability insurance, which pays out money to the other driver when you’re found at fault, is legally required in most states.

The amount of auto insurance you need depends on the law in the state where you live as well as your own risk tolerance level. But keep in mind that even minor auto accidents can be very costly, which makes auto insurance a necessity.

Unfortunately, auto insurance can be more expensive for new drivers — but again, take heart. There are still ways to ensure you get the best possible rate.

Factors That Affect Car Insurance Price

Car insurance prices are affected by far more than just a driver’s experience level, though that’s certainly an important part of the equation. Here are some other factors that insurers will take into account when drawing up your quote:

•  Driver’s age

•  Driver’s gender

•  Driver’s marital status

•  Driver’s history of accidents and damage

•  Driver’s credit score

•  The primary location the vehicle is kept and driven in

•  The vehicle’s make, model, and age

Although there are some general rules that hold true — for instance, that people with lower credit scores or worse driving records end up with higher premiums — the way some of these factors are used is less than transparent.

For example, a 2023 study by QuoteWizard found that women actually pay higher insurance costs than men on average in many parts of America. This is despite the Insurance Information Institute’s claim that women tend to have fewer accidents than men and therefore pay less for insurance.

While there’s no easy way to predict what your rates will look like without getting a custom quote, new drivers will likely need to prepare for higher insurance premiums. This makes sense. After all, the insurance company is trying to hedge its bets that you won’t get in an accident (and therefore need an expensive claim paid out), and they don’t have a driving record to rely on while they make their best guesses.

Recommended: Auto Insurance Terms, Explained

Who’s Considered a New Driver?

Although the classic image of a new driver might be an eager teenager with their brand-new license and the family’s hand-me-down car, there are other people who fit the description, too. Drivers considered “new” include:

•  Teenagers with new driver’s licenses

•  Adults without a driving record

•  People with a gap in their driving history or car insurance coverage

•  Immigrants to the United States, whose driving records might not transfer over from their country of origin

Being a new driver doesn’t change how much insurance you’re required to purchase by state law. But as mentioned, it can affect your price — so let’s take a closer look into solutions for each type of driver.

Car Insurance for Teens

Teens — or, in many cases, teens’ parents — face some of the highest insurance costs out there because, let’s face it: youthful abandon and lack of experience can lead to accidents. There are some moves you can make to minimize the costs, including:

•  Staying on a parent’s policy: Staying on a parent’s policy as long as they’re living under the same roof can keep costs relatively low for teenage drivers. However, parents should still expect their policy cost to double.

•  Looking for discounts for good grades or defensive driving classes: Teens may also be able to score good student discounts by maintaining above-average grades in school, or get a discount if they attend and complete an approved defensive driving class.

•  Maintaining a good driving record: For all drivers, an accident-free driving history goes a long way toward lowering insurance costs over time. Of course, practicing care and vigilance on the road is always of paramount importance. But given how high the cost of teenagers’ insurance policies can be, there’s even more incentive.

Recommended: What Is the Average Monthly Cost of Car Insurance by Age in the U.S.?

Car Insurance for People Who Moved to the U.S.

Even if you have a robust driving history in your home country, if you immigrate to the United States, it’s unlikely to transfer over. This means you could face elevated insurance prices for the first few years you’re a U.S. driver.

The first step to attaining U.S. car insurance in most states is to acquire a U.S. driver’s license, which on its own can be difficult without the proper paperwork. However, certain states do offer driving privileges to unauthorized immigrants. You may need to provide documentation, such as a foreign passport or birth certificate, and the resultant license is not valid as federal identification.

Once you’re ready to shop for car insurance, consider obtaining several quotes to see which company can offer the basic auto insurance coverage you need for the least amount of money.

Car Insurance for Adults Without a Driving Record

Maybe it’s been a long time since you’ve driven — or you’ve never driven at all.

Without a solid, recent driving history, car insurance companies will still consider you a new driver, which can push costs up. Same goes for having a gap in car insurance coverage. (There may be exceptions to this rule if your driving gap was due to military deployment status, so be sure to check with your prospective insurer.)

Shopping around for the best quote and maintaining as clean a driving record as possible going forward will help your case considerably. If you’re confident in your driving ability and you’ve built up the savings to afford it if an accident does occur, choosing a higher deductible could also help you save money on monthly premiums.

3 Ways to Save on Car Insurance for New Drivers

Along with the tips we’ve included in the sections above, there are some universal suggestions that can help most new drivers — and, in fact, most drivers, period — lower their car insurance costs.

Choose Your Car Wisely

Certain cars are more expensive to insure than others, including flashy models that are likely to get stolen (or tempt their drivers into three-digit speeds). You can find lists of the cheapest cars to insure online, but generally speaking, slightly older, more modest vehicles are the least expensive to keep insured.

Improve Your Credit History

It’s incredible how many parts of our lives credit history touches — and car insurance is no exception. While your quote is drawn up based on many factors, as mentioned above, your credit history is definitely part of it. Besides, maintaining good credit behavior is highly likely to help you elsewhere, too.

Bundle Up

Many insurance companies offer discounts to people who “bundle” coverage or purchase more than one type of insurance from the same company. So if you’re required to have renter’s insurance or have home insurance, see if buying them all from the same provider might save you some dough.

The Takeaway

The price of car insurance is impacted by several factors, including the driver’s age, gender, marital status, credit score, and history of accidents and damage. Just as important is their experience level. Newer drivers and drivers with large gaps in car insurance coverage often end up paying higher premiums — at least at first. However, there are ways to potentially lower costs, including driving a more modest vehicle, bundling coverage, and improving your credit score.

Whether you’re a first-time driver or a seasoned pro, shopping around for insurance in your area can help you figure out how much coverage you really need and what your premium might be. SoFi’s online auto insurance comparison tool lets you see quotes from a network of insurance providers within minutes, saving you time and hassle.

Compare quotes from top car insurance carriers.

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Photo credit: iStock/SolStock

Insurance not available in all states.
Gabi is a registered service mark of Gabi Personal Insurance Agency, Inc.
SoFi is compensated by Gabi for each customer who completes an application through the SoFi-Gabi partnership.

Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

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When you adopted your furry friend, you may have underestimated just how much you could love them. Another thing you may not have been ready for: their vet bills.

If you’ve ever worried, What happens if I can’t pay the vet bill, know that you have options. So you never have to choose between your emergency fund and your doggo, kitten, iguana, or fish.

Pets as Family Members

American households increasingly include one or more pets. Currently, 70% of U.S. households have pets. And the majority of American pet owners consider them to be members of the family.

So it’s no surprise to learn that Americans are willing to shell out big bucks for their fur babies. Dog owners spend, on average, $912 per year on them, and cat owners spend, on average, $653.

Caring for the physical health of our pets is as important as making sure they’re happy in our homes. Among dog owners, 36% would pay $4,000 dollars or more out of pocket for life-saving care.

Be Prepared With Pet Insurance

The best defense is a good offense, and when it comes to healthcare, that often means having insurance. Like humans, pets, too, can have their own health insurance that can help with vet bills in case things go awry with their health.

A number of companies offer pet insurance plans at different price points. Just like human insurance, the plans offer coverage in exchange for paying premiums each month along with copays and deductibles. Checking out sites like PetInsuranceReview.com may be helpful when comparing plans and pricing to find the offering that fits you and your pet’s needs.

Negotiate an Installment Plan With Your Vet

You may be able to negotiate a payment plan with your veterinarian, so long as you’re a client in good standing at the practice. This payment plan could work out to weekly or monthly installments, depending on what you and your provider agree upon.

However, it should be noted that this is not a standard practice and your veterinarian has every right to refuse to offer a plan. But it’s always worth asking, especially if it’s the veterinarian who has cared for your pet over its lifetime and knows you well.

Seek Out a Second Opinion or a Nearby Veterinary School

It can be important to get a second opinion before your pet undergoes major surgery or procedures (just as you would for yourself or a human loved one).

If a second veterinarian gives you the same diagnosis and you’re still unable to pay for the treatment, you may want to consider reaching out to a local veterinary college. Some offer low-cost clinics run by veterinary students supervised by experienced veterinarians and vet techs. The American Veterinary Medical Association (AVMA.org) provides a list of accredited schools on its website.

Recommended: Dog-Friendly Vacation Ideas

Seek Help From a Charitable Organization

Charities like Paws4aCure.org provide financial assistance for pet owners who cannot afford non-routine veterinary care for cats and dogs of any breed or age, or for any diagnosis.

If your pet has a non-basic, non-urgent care situation, such as a chronic illness or cancer, organizations like ThePetFund.com may be able to help.

The Takeaway

According to AmericanPetProducts.org, pet owners spent more than $36 billion on veterinary care in 2022. While a typical routine visit costs between $50 and $250, emergency surgery for a dog can run up to $5,000.

One option to cover the cost of expensive medical care for your pet is an unsecured personal loan, which could allow you to pay for your pet’s care upfront, then pay the loanoff over time.

You can’t prevent unexpected vet bills, but you can prepare for other unplanned expenses by making sure you, your loved ones, and your belongings are properly insured. That’s where insurance options with SoFi Protect can help. SoFi Protect offers insurance plans for your home and car, plus life insurance plans to help you protect your loved ones in the future.

Learn more about reliable insurance options with SoFi Protect.

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Coverage and pricing is subject to eligibility and underwriting criteria.
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Ladder offers coverage to people who are between the ages of 20 and 60 as of their nearest birthday. Your current age plus the term length cannot exceed 70 years.
All services from Ladder Insurance Services, LLC are their own. Once you reach Ladder, SoFi is not involved and has no control over the products or services involved. The Ladder service is limited to documents and does not provide legal advice. Individual circumstances are unique and using documents provided is not a substitute for obtaining legal advice.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

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Did you know that if you die without a will, the court gets to decide how your possessions and your money are distributed? That means that any plans you had about giving items or cash to friends, charities, or other recipients won’t likely be followed. What’s more, your survivors may have a tricky road ahead as they navigate the management of your estate.

Unfortunately, the situation of dying without a will is something that can happen more often than you might think. Many people plan to write a will but just never quite get around to it. Even though the process doesn’t have to be pricey or time-consuming, there are plenty of people who avoid the task or other estate planning duties.

Here, you’ll find out what happens if you haven’t made a will. You’ll also learn how writing a will can save your loved ones stress, time, and, yes, money.

Who Handles Your Estate if You Die Without a Will?

When there is no will to name an executor, state law dictates who will be in charge of handling your estate.

A will is where you designate an executor or personal representative. This is the person who takes responsibility for your estate after you die. They make sure final bills and taxes are paid and your assets are distributed properly.

This is often based on a priority list. For example, most states will make the surviving spouse, if there is one, the executor. Adult children are typically considered next, followed by other family members.

Until the courts decide who will distribute your assets, they will be frozen. That means no one can touch your stuff, even if you had told them they could have it.

If nobody is willing or able to handle your estate, the courts will name a public trustee to represent you. This would mean that a stranger would be in charge of distributing your assets according to the laws in your state.

Recommended: Guide to Safety Deposit Boxes

Who Gets Your Money If You Die Without a Will?

If you were to die without a will (legally called “intestate”), the state would decide how to divide your assets.

This process is called probate. Depending on your financial situation when you die, this can be a complex process that can hold your assets in place and be potentially time-consuming and expensive for your survivors.

How an estate will be distributed will depend on state law. Typically, however, the bulk of the estate will go to a spouse. If you have children, they will also likely get a share or, if there are no children, your parents. Next, the state will typically look for siblings, nieces, nephews, aunts, uncles, and cousins. Some relatives might have to claim unclaimed money from the deceased (aka, you).

The probate process can mean that your belongings are inherited by those you didn’t necessarily intend. For example, if you are single and you die, your parents may get all of your possessions. This may not have been your wishes if you have a partner, or if you and your parents don’t get along.

If you are in a relationship but have no marriage certificate, your significant other may not be able to inherit any of your assets.

You also don’t have an opportunity to give anything to charity, your alma mater, or create a legacy.

What if I Die With Credit Card Debt or Loans?

Your estate typically has to pay any creditors before anything is passed down to those named in your will or determined by the court. If you have a mortgage or credit card debt alongside other assets, the process can take time and can lead to confusion and frustration for your loved ones.

If you die, federal student loan debt will be discharged, but private loan debt is dependent on your policy. If someone cosigned the loan, they may be responsible for future payments.

If you have credit card debts and not enough assets to cover them, your survivors are not responsible for payment, according to the Consumer Federal Protection Bureau (CFPB).

But despite your loved ones not being legally obligated to pay the debts, it may also lead to creditors contacting your family.

Recommended: What Happens if Direct Deposit Goes to a Closed Account?

Who Gets My Children if I Die Without a Will?

Guardianship, or who takes care of children who are minors in the event of your death, can be the most pressing concern for many parents.

If you die without a will, the state will appoint a guardian for your children. The state will choose guardians that they believe are in the best interest of the children, but these guardians may not be the same people you would have chosen.

Having the state assign guardians can also be stressful for your loved ones during what would already likely be a tough time.

A will can establish both a personal and financial guardian for your children. While this can be the same person, some parents like the flexibility in dividing guardianship.

For example, a relative may be chosen to be a financial guardian because they are skilled at managing money and have positive net worth. However, a personal guardian could be a family member who lives nearby and could ensure that the children are well cared for and their daily routines stay consistent.

You can also appoint a backup guardian in your will in case your primary choice is unable or unwilling to take on the role. You might also look into putting your house in a trust for your children, which could help ease the transfer process.

Writing a Will Can be Easier (and Cheaper) Than You May Think

If you have a lot of property or assets and may want to set up trusts for your heirs, it can be wise to hire an experienced estate attorney to help you write a will, as well as any other estate planning documents. They can also advise you on the best way to handle a will if you are married.

For many people, however, online templates can be sufficient and, provided the documents are signed appropriately, will be legally binding. A will is an important part of an estate-planning checklist.

After you write your will, you may need witnesses and a notary in order to make sure it’s legal in the state where you live. Once you have a will, there are a few other steps you may want to take, including:

•   Keeping your will in a safe place. This may include having a digital copy and also a physical copy.

•   Letting someone know where copies of the will are kept (say, the person you appointed as executor of your will).

•   Creating other end-of-life documents, including a living will and power of attorney. These documents can be invaluable if you were to become incapacitated and needed people to make medical decisions for you.

•   Talking about your decision with others. Many people put off creating a will, which can lead to confusion and uncertainty if the worst were to happen. Encouraging your loved ones to draft their own wills can help give peace of mind to the entire family.

•   Updating it regularly. It can be a good idea to consider looking at your will every year or so, or after a major event, such as a marriage, divorce, death in the family, home purchase, or the birth of a child.

The Takeaway

Creating a will may seem overwhelming, but it can also be a financially prudent move that helps protect your assets — and creates a legacy based on your wishes.

If you die without a will, you will have no say in how your assets will be distributed and, if you have children, who will care for them. You also risk putting your survivors in a difficult situation.

You may be able to create your own will relatively quickly online simply by plugging in your information. The rest is done for you, and the results are legally binding.

While you’re tackling the to-dos you’ve long been putting off, you may also want to also work on getting your financial life in order. SoFi Checking and Savings makes it easy to manage your money by allowing you to save and spend, all in one account, while earning a competitive annual percentage yield (APY).

Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy up to 4.00% APY on SoFi Checking and Savings.

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As an alternative to direct deposit, SoFi members with Qualifying Deposits can earn 4.00% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant. SoFi members with Qualifying Deposits are not eligible for other SoFi Plus benefits.

SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.00% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.

SoFi Bank reserves the right to grant a grace period to account holders following a change in Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Direct Deposit or Qualifying Deposits until you have Direct Deposit activity or $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Direct Deposit.

Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.

Interest rates are variable and subject to change at any time. These rates are current as of 12/3/24. There is no minimum balance requirement. Additional information can be found at https://www.sofi.com/legal/banking-rate-sheet.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

This article is not intended to be legal advice. Please consult an attorney for advice.

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