Modern Haggling

If we dig back into our sepia colored history or even if we watch an old movie set in the New York's immigrant ghetto, there is always someone standing in front of a vegetable stall haggling about the price of tomatoes or apples. It was a lively tradition, fighting for the best price. That tradition has all but vanished. Americans have become benumbed by commercials and convenience. The art of haggling has slipped into obscurity. It is a lost art, but it is making a comeback and in places you wouldn't normally think it would. The Frugal Yankee has identified six areas where with a little information and a touch of persistence, your wallet will stay a little heavier.

The first pointer we can give is be pleasant and friendly. You don't need to argue. Gentle persuasion with conviction is the key. You want the person you are haggling with to be on your side.

Cable, Internet, Phone

The best deals are the packages, but there is room to bargain. Many of us have a choice of cable companies. The competition makes it easier. First define what you want. Then call around and get quotes for these services. Tell your current carrier that you'd like to stay with them, but you have this offer for $30 or $40 less. They are almost certain to match the other company.

It doesn't end there. Keep an eye on the bills. You may get a 12-month rate and then it shoots up. Do the whole thing again in a year. Savings can run as much as $700 a year. That's not too bad for an hour or two on the phone.

In the cell phone business, there is a word used to describe the coming and going of customers. It is called "churn." Keeping churn down is a goal of most cell providers. Know when your contract ends. Don't renew right away. Start checking around, and when it is time to negotiate a contract, let them know you have other options. They don't want to lose you. They'll negotiate and you'll end up with a better deal.

Don't just haggle over the monthly charges. Ask for free installation, upgrades, better equipment, or anything else that matters to you. You may get it.

Credit Cards

If you carry a balance, look at the interest rate, any annual fee, and other charges like a monthly finance charge. Look especially at other credit card offers from your bank, union, or professional organization. Call your current company and threaten to walk. They want to keep you and will probably cut the rate and some of the annoying other charges. If you carry $5000 balance, you could save $500 a year. One study showed that when consumers just called and asked for a lower rate, they got it about 60% of the time.

Medical Bills

First-rate medical care doesn't have to mean paying full price. Doctors, labs and other medical providers are often willing to negotiate, especially if your insurance won't cover the service. Let the doctor or the lab know if you've lost your job or have other unusual financial strain. Tell them if you're uninsured. Being honest will be helpful in your negotiations. All medical institutions, large and small, have built in profit for any procedure, so there is room to haggle. Here are some negotiating pointers:

• Offer to pay cash upfront. The provider saves time and money if they don't have to prepare bills, and they avoid the risk that you will never pay. This is a big one and will usually get the biggest discount.
  
  
• Compare costs. Check rates against other doctors in the area. The best place to check pricing is at a Medicare or Medicaid website. They usually get the lowest rates. Insurer or consumer websites will also have reliable information. Doctors may lower fees to stay competitive. Let your fingers do the walking. Call around and compare costs. If you have a favorite doctor, explain that you would like to stay with her, but her charges seem higher than other providers do.
  
  
• Ask to include follow up, medications, or tests with the basic charge. Don't get drugs that are name brands or that are heavily advertised. You'll pay in the long run.

College Financial Aid

Don't use the words "negotiating" or "haggling" with financial aid officers. Say that you and your child need help working out a way to make this college financially possible for your family.

• Leverage competing offers. Tell College A that they're your kid's first choice, but from an affordability perspective, College B makes more sense. Ask the financial aid officer if they can match the other school's offer.
  
  
• Ask for a reassessment if you encounter financial hardship. You can ask them to judge your ability to pay on projected income for this year instead of last year's actual income. Most colleges have discretionary funds for such appeals.
  
  
• If your child's extracurricular skills have been noticed by the college, get help from within. For example, let the athletic director or head of the music department know you're struggling with whether your child will be able to attend. This is especially effective for returning students.

Health Clubs

The economy is slowing, so folks are cutting discretionary spending. Health clubs are the first to go. First ask for a reduction or complete waiving of any initiation fee. Then ask for a reduction in the monthly fee. If that won't fly, try for a free month or two in your contract. Compare prices on a couple of clubs and play them against one another. The possible saving should run you between $100 to $300.

Retail Stores

You'll have more room to negotiate with independently owned stores. Ask to speak to the manager. But even big-name chains like Wal-Mart and Target may haggle a bit.

• Show a competitor's ad with a better price for the same item. Most stores will match the price; a few will go 10% lower.
  
  
• Point out flaws. Floor models, sale items and products with visible damage (like a scuff or missing button) are ripe for discounts. Many sales associates can take 10% off without a manager's permission. Ask for more if the item's problem isn't easily fixable, like a stain or dent.
  
  
• Be flexible. Substantial discounts aren't always possible, so ask about extras like free shipping or an extended warranty. Just ask, "Is this the best price you can do?" That leaves it to the employee to start suggesting possibilities.

In this economy, every penny helps. The keys to saving money are do your homework and never be afraid to ask. The more you practice, the easier it becomes.

You'll find Garen Daly at The Frugal Yankee, where you'll find more on frugal living, New England style and downloads of the Frugal Yankee radio broadcasts (look for "latest audio" on the left menubar). copyright Zeotrope Media, Inc.

Take the Next Step:

• See if you qualify for lower payments or interest rates on your credit cards. One call to our friends at Cambridge Credit Counseling could help put your budget back in balance. (sponsored link)
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