Australians are comfortably haggling over fridges and dishwashers and enjoying big savings, but are less assertive when it comes to their bills and banking products, a new study shows.
A survey of more than 1000 shoppers found 60% had tried negotiating a better price on a whitegood and, of those, 94% had won a discount. The average saving was $139.
While haggling over a home loan could lead to savings equal to a year's worth of salary, less than half said they had asked for a better rate – but among those who did, 77% succeeded.
"After whitegoods, Aussies are most likely to ask for discounts on home loans, and their efforts are being rewarded with successful home loan hagglers saving close to $1000 on average," said Kirsty Lamont of comparison website Mozo, which commissioned the survey.
"Consumers are least likely to ask for a discount on internet and mobile plans, with just a quarter attempting to haggle. However, the majority who do ask are successful with combined savings over $150."
Australians are more likely to haggle over whitegoods (average saving $139), home loan ($968) and car insurance ($99), and less likely to try with mobile phones ($75), internet plans ($78) and pay TV ($85).
The research also found male shoppers are better hagglers, saving 60% more than women even though just as many female shoppers ask for and obtain discounts.
Nicole Pedersen-McKinnon from The Money Mentor Way, said banks made their home loan rates appear competitive using "big, fancy signs" and that consumers should always ask for discounts, especially if they're after $500,000 or more.
"We're quite law abiding and we follow the retail rules and in particular the banking rules and when it comes to haggling there's this concept of engineered legitimacy – the more official a vendor makes prices look, the more likely you are to swallow them," said Ms Pedersen-McKinnon.
"But the more you borrow, the bigger discount you can command. Even if it isn't a big amount, knowledge is power, know the deals of their competitors."
According to her calculations, the average monthly saving from getting a 1% mortgage discount – from the average advertised big bank rate of 5.25% – on a $363,300 loan would be $209, or more than $2500 a year.
"To someone who thinks this is all too hard, this saving is probably equivalent on your home loan to one year of your salary over the lifetime of the mortgage," she said.
"Civility is key. Arm yourself with information and then be clear, calm and compelling. I just knocked $200 off my house insurance premium as a result of a very amicable chat with the consultant."
Consumer advocate Christopher Zinn said being an effective haggler required time and persistence.
He said negotiations should start with a polite question about whether the retailer is open to negotiation and the customer should go through with the deal.
"You can haggle over furniture, beds, consumer durables essentially because retailers have to shift stuff," he said.
"We do not live in a fixed price universe. We're given the impression of that. You can ask and if they decline, take your business elsewhere."
How to haggle
- Do your research: Compare prices so you know what rates or fees are on offer and tell the provider they'll have to beat the best offer to get your business.
- Don't accept the first offer: Always ask if the initial discount you're offered is the best they can do.
- Use your bargaining power: Ask if you can get a bigger discount by bringing your credit card to the bank or bundling your mobile, internet and pay TV.
- Don't limit yourself to haggling on rates: You can also ask for discounts or waiver on fees or for extra features to be added for free.
- Prepare to bluff: Tell your provider you'll walk away so they know you're serious about getting the best deal.
This article was originally published by the Sydney Morning Herald on 8 November 2016. It represents the views of the author only and does not necessarily reflect the views of AMP.
Our 5-step financial makeover to make the year of the dog your best yet.