Non-Negotiable Expenses
Why do transportation costs vary in different areas?
Well, transportation costs differ in different areas because of the geography or how much mass transit is available. In a place like New York City where you can get around anywhere in the subway for $2.00 or so. There are lots of trains; it's a quite efficient mass transit system. That doesn't exist in Los Angeles, or Phoenix, or lot's of other places that really don't have much mass transit, therefore it's pretty much car based. It's going to be much more expensive with the price of gas today if it's pretty much car based as opposed to doing mass transit. In some cases people say they want mass transit but they're not actually providing it, therefore people stick to their cars. That's why the cost of transportation is so high in those kinds of places.
Why do public utilities costs vary in different areas?
Public utility costs vary in different areas because of the source of fuel that they are using. They may have to pay much more if they rely on oil prices or for gas prices, nuclear depending on the state of the nuclear plant can be actually cheaper. Coal is another big source for utilities. And that again can be more or less expensive depending on how close they are to the coal mines. Hydro power is another one but it can be really quite efficient, like in the Northwest they have lots of hydro power. So it really depends on their cost of producing the power in the first place as to what kind of cost you are going to pay as a consumer for your basic utilities.
How expensive is insurance?
There are different kinds of insurance that most people need. There's life insurance, health insurance, homeowners, auto, disability and long term care insurance. Each of them have their own cost, depending on your situation. Life insurance ranges depending on how old you are, what kind of health condition you are. If you're older and you're a smoker in bad health condition, it's going to cost you much more than if you're younger and in good health condition. Health insurance is typically paid for by the employer for the most part. But that's been going up really quite dramatically. Disability insurance protects you in case you are disabled on the job. There are relatively few companies offering that, and that's been getting quite expensive lately as well. And then you've got car insurance, which very much depends on your driving record. If you have accidents, your car insurance rates are going to go up much more dramatically, than if you don't have accidents. So in general, insurance is based on the risk of having claims to the company. And the more risk that they're going to have claims - the higher you're going to pay in premiums.
