This is How Easy it Can Be To Negotiate and Save Money

This-is-How-Easy-it-Can-Be-To-Negotiate-and-Save-Money

Photo courtesy of Chris Potter

My wife and I have decided to move. More on that in a future post, but for now I want to tell you how I negotiated at a rate of $5,400 per hour last week.

One of the items in our long list of to-dos is setting up the internet in our new place. So I spent some time researching the different internet service providers in the area and found the best deal to be $35 per month. The only problem? It would lock us into a 2-year contract AND the rate would double in the 2nd year. NOT appealing.

But if I’ve learned one thing over the years, it’s that businesses want one thing: your business.

And that means that the published rate is almost never set in stone.

Enter my (simple) secret weapon

So I called the company, got a guy on the phone and asked him what he could offer me with no contract. He came back with an offer of $50 per month, for the same speed as what was advertised online for $35 per month. The increased price was because we could cancel at any time.

That seemed reasonable, but I wasn’t going to let him get off so easy. So I asked a simple question:

“I see the online offer for $35 per month. I know that includes a 2-year contract, but what can you do to help me get closer to that price without the contract?”

The guy went about typing some things into his computer, and guess what he came up with? That same $35 per month offer, with no 2-year contract. We could cancel at any time without penalty.

Between me asking the question and him looking up the information and explaining the offer, the entire exchange took about 2 minutes. And it saved me $180 over the course of our year-long lease.

Which comes to a rate of $5,400 per hour of work.

BEAT THAT!

Negotiation is ALWAYS an option

Asking that question was SO easy. It literally took me 10 seconds to ask and the worst thing that could have possibly happened was the guy saying he couldn’t offer a lower price.

And this kind of thing works ALL THE TIME.

In just the last few months alone I’ve saved myself about $1,300 in business expenses simply by telling a vendor that I was considering someone else. That was enough to make them immediately offer a lower price.

When we recently bought a car, we saved ourselves thousands of dollars by getting creative with our negotiation tactics.

Over the years I’ve negotiated cell phone bills, cable bills, gas bills, credit card late fees, even the cost of estate planning.

It almost never takes much time. And the worst case scenario is always a simple no. The best case is a huge amount of savings.

That’s savings that you can use to invest, to make insurance more affordable, or simply to do more of the things you truly love.

It’s savings you can use to give your family more security and more freedom.

So the real question is: why wouldn’t you negotiate?

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14 Comments... Read them below or add one of your own
  • DC @ Young Adult Money March 27, 2014

    Sometimes I negotiate but sometimes you almost don’t have to. You can just research various options and all the companies are competing among themselves already to the point where they continuously price themselves down. I think bigger areas you can save is on contract work you pay for where you are typically dealing with smaller businesses or sole proprietors.

  • Michael Solari March 27, 2014

    It’s definitely worth a try! I’ve been going back and forth with Verizon. Thinking about scrapping them though and trying out republic wireless… we’ll see

  • John S @ Frugal Rules March 27, 2014

    Nice work Matt! I think it’s a no-brainer, in most cases, to simply ask. The way I look at it is the worst thing they can say is no and it takes little time. There is so much markup with many services that they can get away with lowering the rate for you and it still allows them to make a profit. As long as you’re nice about it then I say go for it.

  • Tonya March 27, 2014

    Nice job! I agree, it can’t hurt to ask. That reminds me to call time warner (ugh) again and see what I can do to lower my bill again.

  • Andrew March 27, 2014

    It always pays to negotiate. I saw the commercials for Time Warner’s $14.99 internet deal (for a lower speed) and called up about it. They transferred me to EarthLink which is apparently one of their providers and I asked about the deal. They said that I couldn’t get that deal because they were technically not Time Warner (I still don’t understand why). Anyways, they offered me $10 off my monthly bill for the SAME speed that I have now. I took the deal.

  • Done by Forty March 27, 2014

    Nice work, Matt! One of my favorite aspects of negotiating with companies in my personal finances is that you have nearly infinite swings of the bat. Even if you swing and miss, you can try again in a couple days with someone new. Keep stepping up to the plate and you eventually get a hit.

    The rub is that most people find it really uncomfortable, which is a catch-22. You need a lot of practice to get comfortable negotiating. Most people don’t want to do it until they’re competent and comfortable with the process.

  • E.M. March 27, 2014

    That’s awesome and so worth it to save that much. We will be moving shortly too, and I am planning on trying to negotiate to keep our total housing costs down. Hopefully it works!

  • Kieron Alleyne March 28, 2014

    You sir are a boss for negotiating. That $5400 just opened my eyes to saving.

  • Brian @ Luke1428 March 29, 2014

    I really need to do this more. It’s easy to slip into thinking that negotiation will just lead to conflict…and many people abhor conflict. It doesn’t sound like this negotiation was contentious at all.

  • MoneySmartGuides March 30, 2014

    This is a great reminder to negotiate everything. The worst thing they tell you is “no”. It would be interesting to go back and see how much I’ve saved over the years by simply asking for a better price.

  • Derek Chamberlain April 4, 2014

    Nice example of negotiating to save a quick buck!

  • TheBrokeProfessional April 7, 2014

    Yup it’s definitely worth a try to negotiate and even if you don’t get what you want, you can call back at another time and find someone who can give you just that. I’m in the process of changing my cable plan so I will keep this in mind.

  • Matt @ momanddadmoney April 10, 2014

    Hey bro! That’s a crazy experiment. I don’t think I’d have the patience for it. Pretty good story though!

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