Money Savings Tips: If the Price is not Right, it's Negotiable

In today's economy, consumers are scrambling for ways to save money wherever they can, often, buying only the necessities. Consequently, businesses are suffering from a reduction in revenue, especially those that rely on discretionary spending by consumers.

However, consumers don't have to stop spending to save money. More than ever before, small businesses are willing and able to negotiate the cost of their products and services with potential customers.

Everything from insurance to home improvement products to medical services are now being offered on a "what are you able to pay?" basis. Consumers looking for ways to save money need to be aware and take advantage of this relatively new opportunity to save money.

Here are some money saving tips if you're going to be a successful price negotiator. Don't be an obnoxious "haggler" over nickels and dimes. Be gracious. The success of this approach will depend on the generosity of the proprietor. If you offend or irritate the proprietor, you will not be given the opportunity to save money.

The best approach is always to let them know how much you can afford to spend, why you can only afford to spend that much, and ask what can you get within that range. Often, the proprietor will offer to provide what you're looking for within the range of affordability that you've identified.

One area that tends to be overlooked in terms of being able to negotiate a lower price is the professional service sector including insurance, banking services, medical services, legal services, and others. Just like everyone else, their business revenues are down due to economic conditions and they have become more sensitive to the needs of their cash strapped clients.

- Insurance: Let the agent or representative know how much you can afford to spend on a monthly or annual basis. Ask them if they are willing to put together a policy within that price range by applying as many discounts as possible, going with higher deductibles, and eliminating some of the optional "fluff" coverage for which you can assume the risk. There are, also, a variety of ways that agents can adjust the cost of business insurance including asking the underwriter for premium modifications and policy credits, offering to accept a lower commission, and providing pay-in-full discounts.

- Banking services: Ask your mortgage and credit card lenders for a lower interest rate. This is a very competitive industry and rates can often be adjusted as needed to retain preferred customers without having to reapply. Ask your lenders if you qualify for a rate modification. For your checking account, most banks can convert your account to a "free account" at your request. You may need to agree to maintain a certain minimum balance.

- Medical Services: The cost of your medical insurance can be adjusted by going with higher deductibles or co-payments and asking for any kind of group or membership discounts that may be available. Many medical offices including dentists and chiropractors are often strapped for cash while waiting for medical insurance distributions and are willing to negotiate your bill if you ask.

- Legal Services: Most legal serviced are billed by the hour so the best way to negotiate the cost down is to ask your legal service provider for ways to keep their time commitment down to a minimum. Ask if there any questionnaires, forms, or checklists that you can complete on your own time. Ask for discounts by offering to prepay in full rather that a partial payment or retainer. If possible, let your legal service provider know the amount that you can afford and ask that they keep their fees and costs within that range.

- Accounting and Tax Preparation: Keep their time commitment to a minimum by providing your tax and accounting information in a format that is compatible with their data base format such as "excel" or "quick books". The more organized you are, the more they are willing to negotiate their fees. Also ask for referral discounts by providing referrals your friends and business associates.

As you develop your skills as a price negotiator and learn how to save money, you'll find that significant money saving opportunities are abundant in the good times as well as the bad times.