4 Costs You Didn't Know You Could Negotiate
Saving money on everything from medical bills to cable bills
(This article previously appeared on NerdWallet.com.)
You may already know that salaries and the prices of houses and cars are negotiable. But with a little effort and the right strategy, you can also negotiate expensive cable TV packages, sky-high medical bills or the interest costs on your credit card.
Here are four things you probably didn’t know you could negotiate, plus some tips on how to effectively haggle:
Have you ever received a medical bill in the mail, only to view the charge and think to yourself: This just can’t be right.
Well, it’s possible there’s an error or two on the bill. A recent analysis by NerdWallet found that nearly 50 percent of Medicare medical claims contained billing errors, resulting in more than 25 percent overpayment for the services provided.
(MORE: Medical Bills: Even Worse Than You Thought)
Check the bill first for any errors, so you don’t pay for services or treatment you didn’t even receive. This is as simple as requesting an itemized bill from the billing department and asking what services and treatments were provided during your visit. Errors can include duplicate charges, charges for services that were cancelled and incorrect quantities. If you see anything that looks incorrect, call your medical provider to have the charges removed.
If you don’t find any errors, you can possibly negotiate a payment plan with the hospital or doctor’s office, making repayment much easier. Give the billing representative a monthly amount you are able to pay, and they might be able to help you out.
If you still don’t succeed, consider hiring a medical billing advocate to negotiate the bill for you. These are professionals who are hired to save patients money by auditing bills for errors and then fighting the charges. For further help, consider getting a free consultation from a medical billing expert.
Credit Card Interest Rates and Fees
If you carry a balance on a credit card instead of paying it off in full each month, negotiating down the annual percentage rate (APR) can potentially save you hundreds, if not thousands, of dollars in interest.
Let’s say you have a credit card with a $10,000 balance and an APR of 15 percent. By making the minimum monthly payments of $200 a month (2 percent of the balance), you’ll pay total interest of $5,791 until it’s paid off in full. Haggle down the APR to 12 percent, and your total interest costs drop to $3,932. That means one simple phone call could result in a savings of close to $1,900—not a bad day’s work.
(MORE: 6 Credit Score Myths Debunked)
Turn over your credit card and you’ll find the company’s customer service number. Call the number and ask a representative to lower your APR. The longer you’ve been with the company and making on-time payments, the higher your chances of getting the rate lowered.
If the credit card company can’t help you out, you might be able to get a better interest rate elsewhere. Consider consolidating the debt to a new credit card that offers a 0 percent introductory rate period to save on interest costs. If you do this, watch out for balance transfer fees, which typically cost 3 percent of the balance being transferred. But this is something you might also be able to negotiate with the credit card company.
Tell the company the fee is just too high for you and ask if they can do something better. A couple of hundred dollars is not as important to them as your new business, so they should be able to help you out.
Car Insurance Rates
Saving just $25 a month on your car insurance premium equals a $300 yearly savings, so why not take the time to negotiate your rate down?
First, you’ll need to figure out how much you’re paying for the type of coverage you have. Once you have this information, you can compare your current rate to what other providers are offering. Simply call other providers to see if they can beat your current rate with the same coverage, or compare auto insurance quotes online.
(MORE: Car Insurance and Homeowner’s Discounts)
Once you’ve got better quotes in hand, you can go back to your current provider and inform the company of your new offers.
Keep in mind that even if your provider says it can’t lower your current rate, you still might be eligible for a discount. You may qualify for a lower rate if you’ve completed a defensive driving course; have driven at least three years with a clean driving record; or if your car has certain safety features, like extra airbags or daytime running lights.
Cable and Internet Service
Cable and Internet services are basic, yet expensive, household costs that can be easily reduced. It can be as simple as calling customer service and threatening to cancel service because your bill is too high, or asking the company if you qualify for promotions currently being offered to new customers.
Here’s a tip: Try negotiating near the end of your current contract, since the provider would rather keep you as a customer than see your business go elsewhere. Before calling to begin negotiations, do your homework and scout out what rates other providers are offering, so you can ask your provider to beat or match them.
If you’ve been a loyal customer and paid bills on time, the company is likely to help you out. But if they can’t, be prepared to walk and take your business elsewhere.
If you can’t find any good cable deals, consider downgrading from expensive TV packages to more basic services to save some cash, or sign up for a low-cost streaming service like Hulu or Netflix.
Steve Nicastro is a financial writer for NerdWallet.com, where he covers topics such as investing, credit cards, mortgages and insurance. You can follow him on Twitter.