One of the ways I’ve saved money over the years is through successfully negotiating my monthly bills. It’s a tactic I love because you can spend the time to do it right once and then reap the benefits month after month. I’ve been able to negotiate a lower bill for cable, satellite, cell phones, internet, even life insurance (though that was mostly my wife).
This isn’t a unique idea. I’m also not particularly skilled at it. But I was able to do it again just last week with my gas bill and I thought there were a few lessons worth sharing.
National Grid provides the gas that heats our apartment. Though our gas usage fluctuates each month, mostly depending on the weather and therefore how much we need to heat the apartment, we participate in their balanced billing program that allows us to pay the same amount every month. The goal is to smooth out the monthly payments so that you’re able to pay the full amount you owe over 12 months, but do it in relatively consistent amounts.
Every few months they re-evaluate your usage to ensure that your monthly payment is still in line with what you’re actually using. For a variety of reasons we used a lot of gas over the first few months of the year, and after their most recent evaluation National Grid decided to increase our monthly payment from $90 to $151. That’s a 68% increase! Needless to say I was not incredibly excited about this, and I also didn’t think it accurately reflected our usage over the past 12 months. So I called them up to see what I could do about it.
Be polite and patient
The first rule of negotiating your bills? Be polite. The second rule? Don’t forget rule number one. And the third rule? Your patience will be tested. Deal with it.
When I called National Grid, I was led through a series of automated menus. Whenever I get to one of these things, I immediately press 0 hoping that it will take me directly to a person. No such luck this time. So I went down their rat-hole of menus that led me nowhere near the thing I actually needed, until I finally got to a point where I could talk to a person. Patience tested #1.
When a real human finally picked up, it was tempting to say something snarky about how long it took. Instead, I started with “Hi, how are you?” in the most pleasant voice I had. She asked for my name, my account number and my address, pulled up my information, and asked why I was calling. I described my wish to discuss my monthly payment, and she immediately responded that I needed to be talking to another department. So I was transferred. Patience tested #2.
After a few minutes of waiting, a new person picked up the line. Again I started with “Hi, how are you?” in my nicest voice. Again I was asked for my name, my account number and my address. (On a side note, I will never understand why there isn’t a technology that prevents you from having to repeat this kind of information every time your call is transferred within an organization. How have they not figured this out yet? Patience tested #3.) Despite the frustration of having to repeat all of this again, as well as repeat my reasons for calling, I did all of it in a pleasant, gracious manner (at least that’s how it sounded in my head).
The point here is that in all likelihood when you’re calling to negotiate a bill, or even just to ask a question about it, you will likely have to go through several people and/or computers before you get to the person who can actually help you. If you’re not patient and can’t remain polite, the chances of the situation being resolved in your favor are very small. Remember that you want these people to help you. Simply being nice and showing some appreciation for their work will go a long way towards making that happen.
Keep good records
When we finally got into the details of my request, I was ready. Because I’m a huge nerd, I actually record our gas usage and the associated charges each month. So I actually know that our true average charge over the last 12 months has been $113, not $151, and I was able to use this in our negotiation.
If I hadn’t kept good records, I would have been left with two options. I could have gone back through all my old bills, assuming I had them, and done the calculations then and there. Certainly a viable option, but being that I’m naturally fairly lazy I have to be honest that it might not have happened. The other option was to try to appeal on emotions. After all, without facts, what else would I have had? Needless to say, I don’t think that would have been a successful tactic.
As soon as I told this woman that I had tracked our average usage over the last 12 months and wanted to use that as our monthly payment, she was pretty much puddy in my hands. Knowledge is power my friends.
Despite my incessant charm and my army of facts, she still tried to negotiate with me. Her main argument was that if they lowered my monthly payment, I might end up owning them a settlement amount at the end of the year if my usage was actually more than what I had paid. Not a terrible point if I didn’t have cash on hand to pay that kind of settlement. But I do. And besides, would I rather end the year owing them money or having them owe me money? I don’t know about you, but I would much rather not have to deal with trying to collect the amount I overpaid them.
At the end of it, I was able to negotiate a $115 monthly payment, almost exactly the same as the $113 we’ve actually been using and a large discount from the $151 they wanted to charge us. Despite all of her counterarguments, I stuck to my guns and got what I wanted.
Not all of my negotiations have been as successful as this one. But every time they have worked it’s been because I followed the tenets above. In the end, these companies want to keep you as a customer and are willing to work with you as long as you are courteous, knowledgeable and have a reasonable request. Taking the time to negotiate the right way can result in big savings with minimal ongoing effort. Just the way I like it.