June 2021
Financial Planning

Being a grownup brings with it some thankless tasks (doing laundry, filing taxes and sitting in traffic are three that come to mind). But paying your monthly utility bills—which can easily cost hundreds of dollars a month—has to be near the top of the list. Ever wish you could keep more of that money in your pocket? If you're not sure whether one of your monthly bills is negotiable, it doesn't hurt to ask (and it just might help your bank account). There's not much at stake beyond a few minutes on the phone.

How to Negotiate Your Bills

Negotiating your bills can pay off in big savings—if you know how to play the game. As with any negotiation, such as buying a car, it pays to do your homework and plan ahead. Understanding the process, what to ask for and what you're willing to accept can help you be more confident and boost your odds of success in your negotiations. Follow these steps to negotiate your bills like a pro:

1. Gather your info. Create a list of all your monthly bills, including utilities, services and subscriptions, and how much you pay for each. Anything you pay on a regular basis could be fair game for negotiation.

2. Know your worth. Note how long you've been a customer of each service. The longer you've been a customer, the more the provider should be motivated to keep you. The size of your bill may also give you the upper hand in negotiations. A cellphone provider, for example, may do more to please someone with six lines than it would do for someone with just one. Do you always pay on time? Not only does that help build your credit score, but it also makes you a more valuable customer.

3. Identify your options. For each monthly service, identify the company's competitors. It's generally easier to negotiate when many companies are vying for your business and harder when choice is limited.

4. Research rates. Gather details about what's offered by the company you're already with as well as its competitors. Are companies wooing new customers with lower introductory rates, rebates, extra services or other goodies? Write it all down. Based on this information you've gathered, set a goal for the discount you want for each provider and the minimum discount you're willing to settle for.

5. Make the call. Set aside at least an hour for each negotiation. You may have to go through several layers of automation and customer service personnel before you get to someone who can help you. Once they're on the phone, you can start to develop a rapport with your customer service rep. As you make your request, try to stay upbeat, polite and friendly. Customer service reps are more likely to help you if you're nice. Approach the call with a confident tone that assumes you and the rep are on the same team.

6. Keep it open-ended: Reps can generally offer deals you don't know about, so asking a general question like, "What can you do to help me lower my bill?" can get better results than asking for a specific discount.

7. Be patient: Don't give up at the first "no." If the rep you're speaking to says they aren't authorized to change your bill, ask to speak to someone who is—and keep going all the way up the chain.

8. Be willing to walk away: If you threaten to cancel your service, be ready to go through with that threat. Even if you don't intend on going through with it, asking to cancel your service usually gets you transferred to the company's customer retention or loyalty department. These reps are highly motivated to keep you on board and empowered to offer discounts to do so.

What if your service provider says there's no wiggle room? Don't give up. Ask if there are any other options to shrink your monthly bill. These might include: Cost-reduction programs and rebates, Convenience discounts, Retention credits or even signing a longer-term contract.

When you do succeed in getting a lower bill, celebrate—but first, be sure to confirm the details, including when any promotional offers will expire. When you get next month's bill, review it to verify that your cost actually went down. Negotiating your utility bills is a little-known tactic that can pay off big. You may never be able to negotiate your way out of laundry or taxes, but with a little practice, you can negotiate your way to lower monthly bills—and have more money for the things that really matter to you.

If you have questions, please contact us.

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