MONEY COMMENT
Save A Fortune By Haggling

By Cliff D'Arcy
July 3, 2003

According to the stereotype, middle-class Britons are famously reluctant to negotiate when buying goods, the upper classes don't need to, and the working classes drive a hard bargain. I'm not sure whether these labels really apply to modern-day Britain, but it's true that there are two types of people: hagglers and non-hagglers.

I'm from a working-class tribe from the North East and like to drive a hard bargain, but that may just be coincidence. All the same, I approach negotiating with the view that absolutely everything has a chunky profit margin built in, and it's my job to minimise that margin to my advantage. My second belief is that, in this time of economic uncertainty, every seller is crying out for my custom and is willing to cut a deal.

In my time, I've haggled and won:

• One-fifth off a £90,000 house when the housing market was sluggish
• An £800 discount and low-cost finance on a new car (at a time when this particular model was selling like hot cakes and almost all were being sold at list price)
• From 5% to 25% off major electrical purchases in mainstream retailers, including VCRs, camcorders and so on (or, at the very least, a free five-year warranty).

Negotiating is easier to grasp if you recognise that the salesperson is as keen to sell as you are to buy. What's more, your key goal is to shift the middle ground as close to your ideal buying price as you can. In every deal, I'm looking to boost my personal VFM – value for money.

The same rules apply when it comes to financial products. Why put up with over-priced products, when a little shopping around can throw up genuine bargains? For example:

• Bank accounts: 0.1% credit interest - v - 3% or more (thirty times as much)
• Mortgages: standard variable rate deals - v - discounted, fixed and tracker rates
• Credit and store cards: 12% to 33% APR - v - zero-interest balance transfers
• Personal loans: high-street rates of 15% APR - v - direct loans at under 7%
• Savings: pathetic interest rates  - v - over 4% on £1+ with no strings attached
• Insurance: sky-high premiums - v - thousands saved on home, life, health and motor cover.

Of course, once you've found your best deal, you then haggle with your bank (or another leading provider) by challenging it to beat your deal. You'd be amazed what many firms will do to gain your business, plus several offer "price promise" guarantees. So, good luck and happy haggling!

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