A Simple Step to Save Money on Your Monthly Bills
A Simple Step to Save Money on Your Monthly Bills
Are you looking to save money? Of course you are! Who isn’t, right?! Are you looking to consistently save money on your monthly bills and see a significant impact on your budget? Again, yes, of course you are!
Are you willing to put in some time and effort to see those savings? Okay, I may have lost some of you on that one. If you’re still with me, and you’re willing to put in a little sweat to see some savings, there is one step you can take to save on your monthly bills.
That step is to review and negotiate ALL of your bills at least once a year, every year.
Yes, once a year, take a look at all your monthly expenses like utilities, cable/satellite, internet, home phone, cell phone, insurance, or any service you pay for on a monthly or regular basis, and attempt to negotiate lower payments where you can.
Taking the time to do this can save you hundreds per year and potentially thousands.
Why Would Companies Lower Your Monthly Payment?
We tend to think our bills are what they are. Verizon, Comcast, and the like charge what they charge, and we just have to deal with it if we want their services.
This isn’t necessarily the case. Service providers want and need your business as much as you want and need their service. And while yes, they are giant corporations and won’t shut down and close tomorrow if you decide not to be their customer, they recognize something that we as consumers tend to forget and don’t leverage nearly enough: we have a choice of who we want to do business with.
You can choose (in most cases) which provider you want to give your hard-earned dollars to. Companies know that and are willing to do what it takes to keep you as their customer and to keep you as a happy one. So, with that in mind, you are always in a position to negotiate and save money on your monthly bills—you just have to decide that you’re going to do it.
Make Reviewing and Negotiating Your Bills a Habit
Taking the time to review and negotiate your monthly bills at least once a year can result in significant savings. Shaving $40 off one bill, $20 off another, and $15 off yet another adds up and makes an impact on your budget. Remember, we’re talking about savings that continue every month as long as you have that bill. So, even saving $50 across all your bills saves you $600 per year, every year.
You will likely see your greatest savings the very first time you do this exercise. However, continuing to do it every year can potentially provide additional savings and can also serve as an offense against rate increases.
In addition to saving you money, doing this annual exercise also keeps you aware of what you are paying for your utilities and other expenses. Between paperless billing and automated payments, we’re all susceptible to “setting it and forgetting it.” Unfortunately, this could mean that rate increases and the end of that sweet introductory price you got when you first signed up for service go by unnoticed.
Regularly reviewing your bills will keep you well-informed and on top of what your payments are, and it puts you in a position to save year after year.
Preparing to Negotiate Your Monthly Bills
Okay, so are you ready to save money on your monthly bills? It’s not complicated; it just takes a little time. Here are the steps to take.
Set Aside One Day to Review Your Bills
To review and negotiate your monthly bills, set aside one day to make your calls. It should only take a few hours of your day, but clear one day and designate it as “Bill Review Day.”
Just about every major company has customer service available on the weekend, so no, I am not suggesting you take a day off from work to negotiate your monthly bills. This exercise can be done on the weekend if that is the best time for you.
The end of the year is the perfect time to do this, although it can be done at any time of the year. It can also be done semi-annually. The key is to make this a recurring exercise. I typically identify a day in between Christmas and New Year’s Day to negotiate my bills every year. There’s something refreshing about going into the new year having done this.
Again, making all your calls can be accomplished within a few hours, but I suggest designating a day for it, so that no matter how long it takes, you will see this process through. You have to be committed. This isn’t a particularly fun exercise, but the result will be exciting. If you manage to save just $50 a month total as mentioned earlier, that’s $600 just by spending a few hours of your time. Pretty good hourly rate, right?
Gather All Your Bills
Gather your most recent billing statement for each of your bills. If you do not physically receive your bills, go online to print out your statements.
You want to have your current payment, your current service plan, and of course, numbers for customer service available.
Do Some Reconnaissance
Before making your calls, quickly go online and research what a new customer with your current provider would pay for the service you have. Also, research what you would pay for your service as a new customer to a competing provider.
For your insurance bills, you can go ahead and get a couple of quotes for your exact policy from other companies.
You want to have this information handy and use it when applicable during your negotiation.
Okay, now grab something to drink and some snacks and hunker down. You’re ready to make your calls (and to see some savings!)
Making Your Calls
Call the customer department of each provider. Your goal with each call is to get a lower rate for your service and save some money (any amount) on your bill.
This can be accomplished in three ways:
- Your company extends a discount or rate reduction for your existing service.
- You downgrade your service with your current company.
- You switch providers.
Go into your calls knowing which of these three outcomes you’re aiming for. If you can downgrade your service, that’s an excellent way to save money, but if you’re already operating at the slowest internet speed you can handle, be firm when you are discussing your options for lowering your payment.
What to Say
The first words out of your mouth should be positive ones.
You could say something like, “Hi, I am a current customer of company and have been one for # years (or months). I am very pleased with my service and enjoy being your customer. I just reviewed what I’m paying for your service, and the payment is a little high for my budget. I’m calling to see if you can provide a lower payment or a discount for my existing service. Is that something you can help me with?”
(I stress existing because the very first thing most companies will suggest is that you reduce your service or coverage to get a lower rate. So if that is not an option for you, then you want to stress that you are looking to keep your existing service but are requesting a rate reduction or a discount.)
Your initial words to the customer service rep are crucial, as they set the tone for the conversation you will have. And yes this will be a conversation. They will start exploring options for you. If the rep flat out says there’s nothing they can do, politely ask to speak with a supervisor.
Expect to spend some time discussing your options with the rep or supervisor. Keep the tone conversational and friendly, not combative. At the same time, be firm in what you’re asking. Be expectant that your call will be successful.
You may also be transferred to a “retention” or “escalation” department that is able to extend discounts to keep customers from leaving. That is fine, and in some cases preferable, as they will cut straight to the chase of finding a solution to lowering your payment.
Use Your Research
Within your conversation, use the information you gathered while researching. You can say something along the lines of, “I see a brand new customer can get my exact package/service/coverage for $___. Is there any way that rate can be extended to my service?”
Or, “I am able to get my current package/service/coverage for $___ if I switch to company. As I mentioned, I am pleased with your service and am not looking to change companies unless I have to. Are you able to match the rate they are offering?”
There are other tactics you can employ during your calls. Use your judgment on when to use them.
Play the Loyalty Card
You can leverage your loyalty to your current company. “I’ve been a customer for # of years…” Of course, you can only play this card if you are indeed a loyal customer. For years I was given an “off-the-books” rate with my cell phone provider because I leveraged my loyalty to that company.
Threaten to Cancel
You could threaten to cancel your service; however, I do not recommend this unless you are willing to go through with it and have a backup plan should your threat fall on deaf ears.
One company I was dealing with called my bluff when I threatened to cancel, and I was left without service. Threatening to cancel can fast-track you to the department that will throw discounts at you to keep your business, but it can also fast-track you to having no service. So be prepared.
If you’ve compared rates and you are willing to switch if it comes to that, then by all means, play this card (nicely).
Possible Outcomes of Your Negotiations
Some companies will surprisingly be extremely willing to review what you are paying and provide a lower rate. You’d be surprised how simply expressing that what you are paying is more than you can afford, can result in a change to your bill.
Other companies may not be as willing and may make you work a little harder for the discount or perhaps not extend one to you at all.
Here are the possible outcomes for your calls:
- Temporary discount to existing plan/service (For example, some companies may offer you a discount for six months. At the end of the six months you can call again.)
- “Permanent” discount to existing plan/service
- Lower payment with a new/renewed contract
- Downgrade of service
- Switching providers
- No change
Take Good Notes
Be sure you take detailed notes during and after your calls. Ever need to call back a customer service department only for there to be no record of your initial call? Should you need to follow up, you want to have all the details of what you discussed documented.
Record the following info for all your calls.
- Name or ID of customer service representative
- New payment
- New terms of service if applicable
- Date to follow-up (if discount is temporary)
- Any additional details of the conversation (e.g., when the new rate will go into effect, etc.)
You can also download this free Bill Review Worksheet to record all this information.
Tips to Keep in Mind as You Make Your Calls
If this is your first time attempting to negotiate your bills, you may feel a little nervous. That is only natural. Just relax and keep the following in mind:
- Call with confidence. Call with the expectation that the conversation is going to result in savings of some kind.
- Be nice. You know the adage, “you catch more flies with honey than vinegar.” It’s true. The rep on the other line is more likely to help you if you are kind. No one wants to help someone who is nasty to them.
- Be firm. Know what you are willing and not willing to do to lower your monthly payments.
- Don’t give up. Ask to speak to a manager or supervisor or call back to get a different representative if necessary.
What to do After You Hang Up
When you’ve completed all your calls, the hard work is over. You may revel in your savings and think about all the responsible things you will do with this newly found money like starting an emergency fund, or the not-so-responsible (but fun) things like going out to eat. But you’re not finished yet. Two things need to happen after you hang up.
Make sure the changes you discussed went into effect. If they did not, get on that phone again to follow-up. That’s what your notes are for.
Also, remember to follow up if you were given a temporary discount. Set yourself a reminder in your calendar as soon as you finish your initial call, so you will not forget.
Commit to Repeating
As mentioned earlier, this exercise should become an annual habit. Commit to doing this and you will see how reviewing and negotiating your bills annually can become a powerful money-saving tactic.
Okay, so are you convinced? Are you willing to put in a little time in order to save money on your monthly bills? Good. Identify when you plan to review and negotiate your bills. Go ahead and put that date on your calendar today. Download the Bill Review Worksheet so you can keep all your notes in one place.
Again, the end of the year is the perfect time to do this exercise; however, it can be done at any time as long as it’s done on a regular basis.
By incorporating this annual practice, you protect yourself from “setting it and forgetting it” when it comes to your payments, and you ensure that you give yourself consistent opportunities to save money on your monthly bills.
Do you plan to give this exercise a try? I would love to hear if you were able to save money on your monthly bills. After you’ve made your calls, come back and drop me a line in the comments.