The Clark Howard Podcast: May 28, 2025 Episode Summary
Title: Best Auto Insurance / Economic Uncertainty: Preparation & Family Communication
Host: Clark Howard
Release Date: May 28, 2025
Introduction and Episode Overview
In this engaging episode of The Clark Howard Podcast, host Clark Howard delves into two primary topics impacting listeners' financial well-being: the rising costs of auto insurance and navigating economic uncertainty with effective family communication. Clark combines expert insights with real-life listener questions, providing actionable advice to help listeners save more, spend less, and make informed financial decisions.
Best Auto Insurance: Navigating Rising Premiums
Clark opens the discussion by addressing the significant increase in auto insurance premiums over recent years. He breaks down the contributing factors, including:
- Inflation of Used Car Prices: The surge in used car prices directly impacts repair costs.
- Parts Shortages and Mechanic Shortages: Limited availability of parts and skilled mechanics has driven up repair expenses.
- Tariffs on Vehicles: Increased tariffs have further elevated the cost of vehicle repairs.
- Insurance Company Finances: Several major insurers have faced substantial losses, prompting them to raise premiums to maintain solvency.
Notable Quote:
Clark Howard [05:00]: "Not a single big brand name makes the list. They're all smaller, boutique insurers that focus on service rather than flashy marketing."
Annual Report Card on Insurers
Clark introduces a fascinating annual report card from CrashNetwork.com, where body shops grade auto insurers based on their cooperation and service quality. The report highlights that most well-known insurers receive mediocre grades, while smaller, service-focused companies excel.
Key Highlights:
- Top-Rated Insurer: North Carolina Farm Bureau received an A, praised for its cooperative approach with body shops.
- Surprising Results: Amica Mutual, a recognizable name, was ranked 13th with a B+, revealing that big brands often fall short in service quality.
- Recommendation: Clark advises listeners to explore smaller insurers outside the usual big names to find better deals and service.
Notable Quote:
Clark Howard [05:50]: "What do people do when they're shopping? Most people stick with big insurers, but that's a big mistake for your wallet."
Listener Questions and Expert Advice
Clark and his co-host Krista tackle several listener inquiries, providing tailored financial advice.
1. Tony's Fishing Trip Payment Dilemma
Listener: Tony from Illinois
Question: Should Tony pay for his upcoming fishing trip now to lock in the current exchange rate, given the US dollar's decline against the Canadian dollar?
Clark's Advice:
Clark explains the unpredictability of currency fluctuations, advising against committing funds now due to the volatility. Instead, he suggests using services like Revolut or Wise to purchase and lock in Canadian dollars at the current rate without transferring money to the lodge.
Notable Quote:
Clark Howard [09:38]: "Currency movements are so irregular, so hard to judge that I don't know that I would lay money out now for a fishing trip later in the year."
2. Amanda's Cruise Booking Conundrum
Listener: Amanda from North Dakota
Question: Should Amanda book a Mediterranean cruise now or wait for potential price drops?
Clark's Advice:
Given the specific nature of the trip with family members and the uncertainty in cruise pricing, Clark recommends booking now. He emphasizes securing a refundable deposit and the inability to predict future price movements.
Notable Quote:
Clark Howard [14:27]: "I'm going to say something... I would go ahead and book now. You'll be in a position where it will be refundable deposit likely for a long time to come."
3. Mark's Flight Booking Strategy
Listener: Mark from Georgia
Question: Should Mark pay extra for flexibility and Sky Club access when booking Delta flights in Basic Economy?
Clark's Advice:
Clark advises against Basic Economy due to its restrictive nature, such as no seat assignments and limited baggage. He recommends opting for regular economy to maintain flexibility and enjoy additional perks like Sky Club access.
Notable Quote:
Clark Howard [15:24]: "I don't like basic economy. Except for a very last minute booking that you know is going to happen. That's just me."
4. Shelly's Unexpected ER Bill
Listener: Shelly from Florida
Question: Why was Shelly charged a second copay for a follow-up ER visit, and was she wrong to question it?
Clark's Advice:
Clark sympathizes with Shelly and explains that once the situation is no longer an emergency, follow-up should be handled by primary care providers, not the ER. He advises viewing the incident as a learning experience and attempting to negotiate the bill.
Notable Quote:
Clark Howard [30:28]: "You just got to treat this as a very expensive lesson learned and you've done a favor for everybody else."
5. Dave's Gifting Strategy for College Graduation
Listener: Dave from Virginia
Question: Is it beneficial to transfer S&P 500 funds to his daughter's Vanguard account to avoid capital gains taxes?
Clark's Advice:
Clark confirms that gifting the shares is permissible and can help avoid capital gains taxes. He suggests transferring the funds directly within Vanguard and consulting a tax professional for specifics.
Notable Quote:
Clark Howard [32:53]: "You can gift anybody up to $19,000 and there's not even a gift tax implication."
Clark Minute: The Importance of Early Retirement Savings
In the Clark Minute, Clark emphasizes the critical nature of saving for retirement early, highlighting the significant gap between what people plan to save versus what they actually have.
Notable Quote:
Clark Howard [17:39]: "The earlier you start, the more you save. Changes the game."
Economic Uncertainty and Family Communication
Clark shifts focus to the broader economic landscape, discussing the potential for a recession and the importance of open communication within families.
Key Points:
- Economic Indicators: While unemployment rates are historically low, the stability is questionable due to potential shifts in hiring and inflation impacts.
- Family Discussions: Clark stresses the necessity of talking to children about financial situations appropriately, alleviating their worries by explaining the family's preparations for economic downturns.
- Couples Communication: He urges partners to engage in regular, non-confrontational money discussions to strengthen financial resilience.
Notable Quote:
Clark Howard [20:02]: "Parents generally avoid discussing with their children what's going on generally with the economy and what it means in their house... it's all about being appropriate for the age of your kids."
Conclusion and Closing Remarks
Clark wraps up the episode by reiterating the importance of financial knowledge and proactive planning. He encourages listeners to utilize available resources, engage in meaningful financial conversations with their families, and remain disciplined in their savings habits to navigate uncertain economic times effectively.
Notable Quote:
Clark Howard [32:53]: "That's what I'm about and that's what I want for you, is to have more knowledge, more power in your own life."
Resources Mentioned:
- CrashNetwork.com – Annual insurer report card
- Revolut – Currency exchange and financial services
- Wise – International money transfers
Submit Your Questions: www.clark.com/askclark
Join future episodes of The Clark Howard Podcast for more expert advice on saving money, spending wisely, and achieving financial freedom.