BRK.A and BRK.B/GEICO discount

[gratefuled]

This is an FYI, not a sales pitch, but I just found out that Berhshire-Hathaway shareholders get an 8% discount of GEICO car insurance rates. I know there are a few other BRK-heads on this board.

Studying the GEICO quotes made me realize something about the cost-of-living spread, too. My retirement plans include moving from Massachusetts to Tennessee, and my total insurance cost for two cars should drop from around $4000 to $750.

Ed

[laurence]

$4000 for car insurance? And we complain about $1600, and that's comprehensive on two (relatively) new cars.

[gratefuled]

Yeah, and I should point out that:

1)These are state-controlled rates (to protect the consumer from price-gouging.)

2)I am paying $4000 to insure about $4000 worth of cars.

3)GEICO won't even do business here because...believe it or not...it's a money-losing prospect at those prices.

4)$4000 is the multiple-car, high-deductible, good driver, nobody-under-25 rate.

I love Boston. Now, can I have another slap from the rubber hose?

Thanx...

Ed

[laurence]

Ouch, I'm surprised there isn't rioting in the streets! Are salaries that high in Boston that people can hang with that? That's more than my property taxes!

[gratefuled]

The salary-to-expense thing is a fine line for most Bostonians. Your average Joe up here doesn't have any retirement money; he's treading water.

For instance, the city government is a huge employer. It has an in-city residence requirement for its employees, but its employees can't subsist on city salaries. So many, if not most, cheat...they register their cars and get their mail at their cousin Seamus's place, and then they buy whatever they can afford in the suburbs.

And on that subject: rent for a decent three-bedroom apartment runs $1500 to $2000. A 3-bedroom house in a so-so neighborhood will run you a half-million or more. Property taxes go up 10% or so a year. Insurance we've already talked about. Public schools suck; private schools hike their tuition in line with property taxes. State income tax is 5.25% and state sales tax is around 5%.

As a result of this and other problems, professionals aren't coming to the metropolitan area.

In fact, they're leaving. Case in point: me.

Ed

[Helen]

<<<As a result of this and other problems, professionals aren't coming to the metropolitan area.

In fact, they're leaving. Case in point: me. >>>

Ed, I totally agree with you. I lived in Boston for 8 years after graduating from college with a BS in Business and a MIS (computer) degree. I had great jobs and good salaries but I couldn't get ahead financially. I have lived in Oregon for 14 years and what a difference in my net worth !!!!

There is no way I would be able to retire if I had stayed in Boston.

Best of luck,

-helen

[fufund]

Ed ,
Any details on 8% offer.... I can't seem to find mention of it on either GEICO's web site, Berkshire-Hathaways site, or in my Google searchs (I must be a lame computer user today)

If you accept the conservative value from the Berkshire Hathaway Intrinsivaluator webpage and already have GEICO insurance (or on re-pricing offers the best value)... then this doiscount is a no brainer..... sort of a Dividend for a non-divedend paying stock

Thanks in advance for your help

[gratefuled]

Warren Buffet mentioned the discount in the BRK annual report this year. If you search for his letter to shareholders you might find it.

Also, if you go to the GEICO website and fill in the on-line quote, one of the questions is whether you're a shareholder. I wouldn't know where else to send you.

Ed

[LEX]

Gratefuled:

You will love Tennesse. *The people there are great. *You can always visit the Socialist Republics to remind yourself about the bad old days.

Your experience on car insurance is most likely just the tip of the iceberg when one includes the loaded overhead of living in a state that has become a failed experiment in social engineering at the helm of the Unions and the "I know whats really good for you" Liberals for decades. *

The take away is that the best locations for ER are states where they still respect personal freedom and property rights. *Tennesse, Texas, and most of the so called "fly over" states (avoid either coast) seem to fit the bill.

[MRGALT2U]

Avoid Illinois, Minnesota and Wisconsin also.

JG

[gratefuled]

I love Tennessee. I went to high school in Chattanooga and college in Knoxville.

I'm getting OT, but what the hey. The people are great in Tennessee, no question. As a general rule they're polite, they're friendly, they take pride in their work, they're "moral," and they mind their business. Yeah, there are exceptions, but you can generally settle such trouble on your own without resorting to the cops or the courts.

Not a bad place to raise a daughter.

But you know one of the most interesting cost savings about the particular part of Tennessee that I'm moving to? It's that outdoor-related fun tends to be free, or extremely low-cost. Free parking in most public places, cheap fishing licenses, little or no permitting, open access to lakes and rivers, etc. It's not like that in New England anymore.

Ed

I won't dive into this Tennessee vs. Massachusetts debate other than to mention that I too have lived in both places but plan to stay here in Boston.

I will, however, concede some envy over your auto insurance bill. I pay $4400 for only one car! When I moved from central Boston to Dorchester, I figured my rates would go down. Instead, they almost doubled.

Quote:

As a result of this and other problems, professionals aren't coming to the metropolitan area. In fact, they're leaving. *Case in point: me.

I agree with much that you say but would gently quibble with your assertion that professionals aren't moving to the metropolitan Boston area. They are, in droves, along with hefty salaries. If they weren't, the apartment/housing costs would be driven down to something more reasonable.

[gratefuled]

I found a recent Boston Redevelopment Authority study that suggests you're right in the sense that the number of "professional" jobs in Boston is growing. However, there are a trainload of studies that suggest the people occupying these jobs are choosing to locate outside the city limits, so my term "metropolitan area" wasn't the best choice. I guess the moral might be that the salaries aren't enough to offset the in-city lifestyle.

Ed

[brewer12345]

Quote:

Yeah, and I should point out that: 1)These are state-controlled rates (to protect the consumer from price-gouging.) 2)I am paying $4000 to insure about $4000 worth of cars. 3)GEICO won't even do business here because...believe it or not...it's a money-losing prospect at those prices. 4)$4000 is the multiple-car, high-deductible, good driver, nobody-under-25 rate. I love Boston. *Now, can I have another slap from the rubber hose? Thanx... Ed

Not to gloat, but this is exactly the reason I invested in Commerce Group (CGI) a few years ago. Check out the stock chart.

I recently switched to GEICO now that they are in NJ and I found them to be ~35% cheaper than Liberty Mutual. I am strongly considering buying a single B share of Berkshire just to get the dividend, although it would only amount to ~$120 a year.