Financial win

posted by Unknown On Thursday, October 01, 2009
Yesterday, I ended the battle over the remaining money my family owes the hospital for my son's birth. After an insurance review that went nowhere and several months of waiting and nerve racking phone calls, it's finally over. And I won.

It ended with the hospital settling and discounting the balance we owed by 45 percent. This is a tremendous financial relief, as well as a major ego win for me.

It felt wonderful to confidently ask for a discount and get it.

And really that was my whole process. I asked what the options were. They said I could pay it in two installment. I asked what else, and they said over six months. I asked what else, and they said we could pay it over 12 months. I kept pushing this all the way out to 24 months with no interest on the balance.

I then asked if there was any way to discount the balance. They said they could take off 25 percent. Then I followed the same steps as above pushed to find out what the process was to get more, looked at the numbers, and asked for what I wanted. A few days later the offer was accepted.

I also had a recent and similar experience with my cell phone service. I won't name my carrier here or what they did for me because I told the manager who helped me that I wouldn't tell. Suffice it to say that it was good enough for them to want to keep it a secret.

However, now I wonder: in how many situations do I pay too much? Where can I get discounts by asking? I want to be financially smart, and part of that is paying as little as possible for the products and services my family needs.

I think what I'll need to do now is go through my family budget, line by line (which won't be too difficult since there's only a dozen lines in today's version). This will be a fun project that I'll work on over the next several months. I'll share my successes, I'll try to share my failures (maybe), and I'll share what I learn along the way.

Prices for most things are, to a great degree, arbitrary. They only represent a point of intersection between what people are willing to pay and what businesses are willing to sell for. However, what I'm willing to pay is usually below the price on the tag, and the real key is that the price business are willing to sell at are lower too.

Many purchases are small and the prices are set at a very low margin to begin with. However, other purchases are for services that will be paid for over a longer period of time, such as insurance of cell phone service. Small savings in monthly payments can easily translate into large long term savings.

The time and effort it takes to get these savings is a cost in itself. Haggling over the price of a soda or a pack of gum would not be worth it. The amount I'd save wouldn't be in proportion to the time and energy it would take to come to an agreement.

However, if it takes two hours to lower my monthly premiums by $20, over the course of a year, that two hour effort would equal $240. I don't currently make $120 per hour so I'd consider that a big win and a good use of my time.

These are the types of solutions I'm looking for. I'll be exploring the blog-o-sphere for inspiration and answers, and will share here my progress and what I learn and what works in practice.
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