Americans, like those in much of the Western world, live in a fixed price culture. We walk into a store and the prices are laid out before us. Take it or leave it are the only choices, right?
That’s wrong, according to Michael Soon Lee, author of Black Belt Negotiating. We actually can and should look for more “opportunities” to practice our haggling skills, he said. “You would be surprised what you can save,” Lee told HuffPost.
Here are 10 situations where that advice can be applied:
Income taxes are not usually negotiable unless you owe a lot of money. If you owe $10,000 or more, Lee advises consulting a tax specialist who can often get this bill substantially reduced. “The IRS knows they can’t get blood from a turnip, so if you come up with a reasonable amount of money, they’ll often wipe the debt off the books,” he said.
To be clear, it’s not so easy to get the IRS to settle a tax debt for pennies on the dollar. It happens only in cases in which a taxpayer clearly does not have the assets and/or income to pay off the tax debt in a reasonable time. If you have the money to pay the IRS ― or will likely have it in the future ― no amount of negotiating will convince the IRS to settle for less than what you owe, wrote lawyer and author Stephen Fishman on Nolo.com, a legal advice website. This is true whether you represent yourself or hire a high-priced law firm, he said.
What you are really asking is that the IRS accept what’s known as an offer in compromise ― an agreement between a taxpayer and the IRS that settles the taxpayer’s tax liabilities for less than the full amount owed. The IRS will accept your OIC only if you convince the agency that you can’t pay the full amount in a reasonable time or that due to exceptional circumstances, payment in full would cause an “economic hardship” or be “unfair” or “inequitable”― for example, you can’t work due to health problems, or you’d be left with no money to pay your basic living expenses if you sold your assets.
If you want to try it, start with this IRS booklet.
Many store managers have the authority to discount a large purchase by 10 to 15 percent to keep you from walking out of the store, said Lee. “They know that once you leave, the chances that you will come back are small,” he said.
They key is to talk to the manager, not just a salesperson, he said, because you should never take “no” from someone who can’t say “yes.”
Do your homework and find out what alternatives exist for their product or service. The more alternatives you have, the more likely you can get a break on the price.
3. Expensive jewelry
Jewelry is normally marked up 90 to 110 percent, so there’s plenty of room for bargaining. The more pieces you are buying, the better the deal, so Lee suggests teaming up with friends and relatives to do your shopping together.
4. Medical bills
Whenever possible ― which should be every time that you are conscious and not on a gurney in a hospital emergency room ― you should first ask whether a doctor accepts your insurance and is in your network. If not, you won’t be the first patient to learn the hard way about the difference between an in-network provider who has agreed to accept what your insurer will pay and an out-of-network provider who will not. The latter will balance bill you the amount they thinks their services are worth.
When the out-of-network provider sends you a bill, you will likely be shocked. What you shouldn’t do, though, is pay it right away. Many medical entities send patients a bill while an insurance claim is still pending. Once your insurance company reviews your coverage, it will send you an explanation of benefits and tell you how much it paid. Then ― and only then ― should you pay the doctor, and be sure to ask first if they will consider accepting what your insurance paid as payment in full.
Keep this in mind: cash rules. Most doctors pay thousands of dollars each year to collection agencies hoping to recoup what patients owe them, and doctors dislike credit card payments because they come with high processing fees. If a patient pays cash up front or within 30 days, chances are that patient can negotiate a better deal.
Start the conversation with something like this: “Hey Doc, I see you got an insurance payment of $500 for my recent procedure and balance billed me $800. I can give you $200 cash right now but that’s all I can afford. Will that satisfy this bill?”
If you lack the cash to do that, ask for a payment plan.
When it comes to hospitals, where bills are likely to be more costly, call the billing office and begin by saying you hope to resolve this bill today. Would the hospital rather have $2,000 today or chase you for the next several years to collect $5,000? Hospitals are generally eager to get what they can. In some cases, they will direct you to charitable relief.
The bottom line is that hospitals are acutely aware that nobody has ever paid a monthly hospital payment when they needed the money for their rent or mortgage.
5. Appliance repairs
Yes, you can counteroffer when the refrigerator serviceman quotes you $500 to fix your ice maker. Offer $400 and tell him there’s no rush, he can do it between other jobs and at his convenience.
With rare exception, few people of sound mind actually enjoy car shopping. Customers always have the sense they are being scammed. Does the nice salesman really disappear for 20 minutes to talk to his manager or is he just chatting with coworkers by the water cooler knowing you’re in the deep freeze, waiting for the phantom manager to rule on your offer?
Yes, some dealerships are better than this. They boast there’s no haggling on prices and actually expect you to pay the price on the car window. They will still haggle on things like how much your trade-in is worth.
Car shopping requires you to be aggressive and sometimes step out of your polite zone. Dig deep when asking for a discount, Lee advises. If you only ask for a small cut in price and the dealer comes back offering to split the difference, was it worth the effort? The thing you never want to hear when you ask for a discount is the word “OK,” because it means your offer was too low.
Don’t make the first offer. Let the salesman tell you what the best price is ― not what’s on the sticker. When you are negotiating, price the car as clean as possible. No trade-ins, no loans. You can add those things on once you know what you are actually paying for the car, advises Consumer Reports.
Your ultimate weapon are your feet. When you leave a car dealership without making a purchase, you are making a statement. And you can expect that they will contact you again.
7. Car repairs
The bulk of the cost of any major auto repair is the labor and time spent fixing it. Both are very subjective. You can Google the cost of parts and ask the mechanic how many hours of work the job entails. Point out that yours is a multi-car family and you are looking for a shop you can trust and rely on for all your repairs. Some mechanics will offer you an estimate but qualify it to say they don’t know what they might find once they break things down. Repair Pal suggests you respond with, “I would give you approval for this repair if you could give me a break on the price.” Most times, service advisers are commissioned and would rather make less than lose a sale entirely. Most shops routinely offer military, AARP and AAA discounts if they are requested.
Repair Pal also says that if your vehicle is just out of warranty, most dealers will be sympathetic and cut the price. Well-run businesses value customer loyalty.
8. Dry cleaning
Women pay two to three times more for laundering a blouse as opposed to a man’s shirt, Lee said. “And why? Just because the buttons are on the other side?”
He said that if you’re a steady customer at your local dry cleaner, threaten to go to a competitor if the shop owner won’t come down in price. Lee said to point out that you have been a loyal long-time customer, and they don’t have to pay for advertising to earn your business.
9. Credit card annual fees
This is another area with substantial competition. Sometimes all it takes is to ask the company to waive the fee and they will do so rather than lose your business. If you have a credit card with a very low interest rate but pay off the balance every month, that low interest rate isn’t really of much use to you, so why pay a fee for it?
10. Flea markets, farmers’ markets and garage sales
Hit them at the end of the sale. Merchants would rather sell their inventory ― even if it’s for less than they wanted ― than carry it home. Plus, if the goods are perishable, shelf life matters. Some smart shoppers do this routinely and ask “How much for all of it?” Serious low-ball time.
This article originally appeared on HuffPost.