Haggling with those who sell you stuff can help you regularly save and reduce your personal debt. Just ask Jeff Yeager, author of the book, “How To Retire the Cheapskate Way.” The writer estimates his haggling tactics save him anywhere from 10 to 15 per cent a year on spending.
“I try to negotiate on all sorts of things, every day. And the vast majority of the time, it’s a very positive interaction,” Yeager told Canada’s Financial Post, which published an interesting article not so long ago concerning the art of haggling.
Yeager - along with what Consumer Reports estimates to be almost half the population - employs specific haggling strategies that are proven to be highly effective. Almost 90 per cent of those who make a habit of negotiating prices get positive, cash-saving results, sometimes terrific results. The Financial Post cites the case of journalist Laila Yuile, who wanted to buy a brand-new GMC Sierra.
“I went into the dealership three days before the end of the month, got the paperwork started and then walked out when they wouldn’t budge on the price,” Yuile says. “The next day they called me – and offered another $3,500 off.”
Now, that’s what I call a bold measure for cash savings and sound personal debt management.
Yuile’s tactic of being willing to walk out the door is a psychological gambit that empowers the buyer. It kind of reminds me of the career advice often offered to those who are looking for work. During the job interview, maintain the psychological stance of one who is skilled, who is passionate, and who can bring lots of value to the job, but don’t appear to be overly anxious about joining the team. Above all, show no signs of desperation. But remaining a little aloof, you exude a professional air of confidence and marketability that makes the employer want you all the more.
The secret to the haggler’s wisdom is the understanding that prices in many situations are not set in stone, and one should always be prepared to boldly take the initiative to get a deal. But you need to be smart about the matter. For instance, know how much power rests in the hands of the person you are haggling with. Can he or she make the call on cutting you a deal? In today’s challenging economy, more and more major retailers are giving frontline staff more power to make deals, the Post says. Otherwise, go up the ranks to haggle with those who can say yea or nay.
Timing is also important to successful haggling. Take a moment to think about when you’re trying to strike a bargain. You are less likely to get a deal on a blue Monday rather than at the end of the week when folks are in higher spirits and eager to enjoy the weekend. As Yeager told the Post, “I believe the best day to negotiate anything … is the Friday before a three-day long weekend. Think about it. The last thing people want to do is spoil their own weekend by leaving stuff unresolved.”
The Post article notes the same principle applies to what time of month you choose to haggle. “Is it at the beginning, when salespeople still have plenty of time to meet their sales quotas? Or at the end, when they need to make deals to impress the boss, and put dollars in their pockets to make the rent?”
There are specific haggling scripts one can follow when dealing with reps from banks, telecom providers or credit-card companies, the Post says. There is for example the “escalation script,” which goes something like this: “Boy, I’ve been a customer since 2006, and I’d hate to leave because of a $20 fee.“ With that, there’s a great chance of getting your fee waived.
Due diligence also plays a role in haggling, meaning you ought to know what makes for a good deal through a little prior research into prices. Knowing a store’s prices in relation to the competition arms you price markers that can make a difference in the back and forth. As well, knowledgeable hagglers often buy seasonally on the basis of what merchants want to quickly move off their shelves and out of their showrooms.
It’s not often said that haggling is a key element to good personal debt management. But after taking in the Financial Post article, I’m saying it here. Making a habit of negotiating prices could make a real difference in terms of what you save – and how much you owe in personal debt.
Ready. Set. Haggle.