Your budget is full of expenses you don't need or are overpaying for. These are services you signed up for years ago that, at the time, made sense. But over time, our needs change.
And what we pay for needs to reflect that.
And for many of the things that haven't changed, prices keep going up but they don't have to. If there's a service you're paying for that you still need and are unwilling to cancel, make sure you negotiate down your rate. With just a few simple steps, you can lower how much you're paying each month and put that towards more important things like paying down debt, saving for a vacation or even your retirement.
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Here are 15 expenses you should renegotiate right now.
1. Auto Insurance
If you own a car, you're required by law to have auto insurance rates seem to keep going up each year. Insurers aren't stupid, they price their policies based on a variety of risk factors such as mileage, commute pattern, where you live, and even where your car is parked. If your driving situation has changed, such as if you work from home, call your insurer to see if they can lower your rates based on your actual usage.
It's also important to get auto insurance quotes from other companies to better understand how much you should be paying. You can use these rates to get your current auto insurance carrier to lower your rates or, if they won't play ball, use them as an option when you switch. Getting a quote gives you leverage, even if you don't use it.
2. Medical Bills
Tragically, medical bills are the leading cause of bankruptcy in America. Many don't know you can negotiate these bills and hospitals expect it, since they deal with it all the time with insurance companies. Make sure you ask for an itemized bill, review it for errors and duplicate charges, and call up the billing department to ask about discounts. You may be able to get financial assistance as well.
DollarFor is a nonprofit that helps Americans navigate “charity care,” which is financial assistance programs that nonprofit hospitals must offer by law. They don't charge you a penny for this help, it's their missing to help Americans get the benefits their due.
3. Homeowners Insurance
Much like auto insurance, homeowners insurance premiums also rise over time as costs and risks increase. And much like your auto insurance, what you pay today may not be what the market requires. You will want to comparison shop your homeowner's insurance with a few providers and see if the rates you're paying are still fair.
Then, go back to your current insurer and ask if you are eligible for any discounts or if there are changes to your home that could facilitate a discount. You may be over-insured or have unnecessary riders. Again, there's no such thing as loyalty when it comes to insurance.
4. Streaming Subscriptions (Including Apple TV+)
It seems like every month, another streaming subscription increases their rates. What was once $7.99 a month is now $9.99. $12.99 becomes $14.99. And how many services are you signed up for? I have half a dozen, each of which is “important” to someone in our family!
Now's the time to audit your usage to see which services you're actually using and which could be replaced with Youtube or some other free service. Consider canceling the services you don't use, downgrading the ones that you do if a lower tier exists, or potentially switch to an annual payment if it offers significant savings.
Or, since there are no costs to canceling and signing back up, rotate among services so you only pay for what you use. Sign up, binge for a month or two, then cancel.
5. Internet Service
Most people overpay for internet service either by paying for too much speed they don't need or because they don't comparison shop and make their company compete for their business. Your first step is to call your provider and ask about promotions, loyalty discounts, or potentially degrading your plan.
If they won't budge, look for alternatives. Internet companies are constantly competing for your business so look around to see what new customer promotions are available. It's such a commodity that loyalty means nothing. You may need to threaten to switch before your existing provider plays ball.
6. Cable or Live TV Packages
Like internet service, your cable and live TV packages are the same. You're probably paying too much for a service you're hardly using. We cancelled our cable years ago and barely noticed, though we are now paying almost as much for all the streaming packages!
Call up your provider and see if there are discounts they can offer or if you can downgrade to fewer channels you're never going to watch. Are there premium add-ons you are paying for but don't use? What about promotional pricing if you stick around?
Or, if all else fails, maybe cancel it and see if you even miss it. If you're paying for streaming services, chances are you don't need it anymore.
7. Cell Phone Plans
If you aren't locked into a cell phone plan contract, you should be shopping around for a new contract either with your current provider or a new one. Many companies are offering new phones, lower plan prices, and other incentives to get you to stay. Legacy cell phone providers are afraid of cheap no contract MVMO cell phone plans like Mint Mobile, where you can get basic cell service for only a dollar or two a day.
8. Credit Card APR
If you carry a balance on your credit cards, call your credit card and find out if they will lower the interest rate, or APR. Credit card companies charge very high rates on your balance but you can ask for a lower rate or a temporary promotional APR. If they won't budge, threaten to switch to a new credit card that may offer a 0% balance transfer.
This promotional balance transfer rate is a very attractive way to catch up on your balance. When you use those balance transfers, you will pay an up front transfer fee, typically around 3%, but get 0% for 12-18 months.
9. Rent
Despite what many people believe, rent doesn't always go up. If you are a reliable tenant that pays on time and doesn't cause problems, talk to your landlord about a potential rent reduction the next time your lease is up. You can offer to sign a longer lease and they get the stability of a reliable tenant while you get your rent cost fixed and predictable.
If they won't budge on rent, it's possible they will throw other amenities in like parking, storage, or other benefits. At the very least, you'll know where you stand with the landlord.
10. Property Taxes
Property taxes are another area where negotiation matters. When you get your property tax assessment, it's important that you always appeal it. Do not just accept what the county states.
The market may have shifted, they may have your home details wrong, and a few hours of research and filling out of forms can result in hundreds, if not thousands, in savings. Check your assessment, pull recent comparable sales, and challenge it if the numbers don’t line up.
I did this a few years ago in Maryland and was able to secure significant savings.
11. Gym Memberships
Gyms sell more memberships than they could reasonably service in their facility. They do this because they know that not everyone who pays for a membership will use that membership. It's no wonder the gym is always packed in January and empty by February!
With this one, it's time to be honest with yourself. Are you using the membership? If so, wonderful. If not, it's a waste. You're under contract, see if you can downgrade your membership or get a discount for using it less. It's often not going to be very fruitful when under contract but it's still worth a call.
If you're not under contract, cancel. Or switch to a cheaper gym. Do something! Don't just keep paying.
12. Banking Fees
Banks make billions each year just off the fees they charge – monthly maintenance fees, overdraft fees, ATM fees, and the like.
Did you know that many are negotiable? If you are charged a fee on a regular basis, call your bank to see if you are eligible for fee waivers. If not, are there better account options based on your usage.
If they still won't budge, it's time to switch banks. Many online banks won't charge you any of those fees and they'll even pay you a high rate of interest. In fact, I'd be hard pressed to find an online bank that will charge you maintenance fees these days. Many offer ATM fee reimbursement and free overdraft.
Don't accept that paying your bank a fee is a way of life, it's not true anymore.
13. Student Loan Interest Rates
If you have private student loans, look into refinancing them. If your income or credit have improved, you may qualify for a lower rate and that can significantly decrease how much interest you're paying over the life of the loan.
If you have Federal student loans, that world is a bit trickier because of income-driven repayment plans, forgiveness options, and whether recertification could lower payments.
14. Home Services (Trash, Pest, Lawn, Security)
If you pay for home services such as trash collection, pest control, lawn care, or security systems – you should shop those around as well. At the very least, call to see if there are loyalty discounts because they may offer you a small incentive not to look around.
Companies want to keep your business so if you find alternatives, they may be willing to match or beat offers and keep you around. These are really easy services to switch too and they know it.
15. Software & Digital Tools
Finally, if you pay for any software subscriptions, see if you get it cheaper with discount codes, paying for an annual plan, electing nonprofit or creator pricing, and the like. Sometimes you can just threaten to cancel online and find “cancel-flow” discounts. That's where they automatically offer you a discount, as part of the cancel process, to keep you around.
The worst case is if you do end up canceling and they don't offer a discount, you'll just have to sign up again!
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