Highlights from the Dave Ramsey Show

I agree...ALWAYS pay with cash and forget the game called "90 days same as cash"...

I personally don't have the desire or energy to play the "same as cash" game. When I pay cash (which we did 2 years ago to have major repairs done on the house) I don't have to think about it again. It's done. I don't have to wonder if my monthly payment was recorded properly by some bozo in the finance office. Some folks enjoy the challenges ogf the finance game or just feel like they are being smarter than everyone else and taking advantage of using someone else's money. I need to remind you that they wouldn't make those sweet offers if they weren't pretty sure that they were going to get something out of it. Call me naive if you will, but also call me debt free.

I am all for paying cash. But, I am not much of a bargainer. If the price tag says $XX.XX, then I'm inclined to pay $XX.XX. Dave says to ask for discounts when paying cash.

My question is...At what price should I start asking for a discount for paying cash, and how much is reasonable? One would obviously not ask for a discount on a hamburger at Burger King, for example. When do you start getting into discountable territory? $50.00? $100.00? $1,000.00? And what is reasonable to ask for? 5%? 10% More? Less?

Debt free (except for the house) by June '08!!!!!!!!!!!

I will agree, I do alot with cars and stuff , and when Dawn is talking about "services" I have to agree. When I would get my exhuast done on my past 11 cars (which were all paid in cash) I got a 10% discount always. I am talking about full flowsmaster with dumps on a 91 Fox5.0.

Also to the person talking about the 7,000 they had and did the 12 months same as cash cause they got 300 from intrest, well i am here to tell you that if your worried about 300 bucks then somthing is wrong. If you have the money pay for it. I could save 300 in a week and a half.

Just my 2 cents.

Negotiation, can net you more than "12 months same as cash". I negotiated a price on a water treatment system for $2000, but continued to wince, whine, and complain to the salesman (the owner of the company), that I couln't really afford that much all at once, and would have to borrow money to make the purchase. He then offerred to "finance at 0% for 12 months".

I asked who was carrying the balance for that period. He named a finance company. I pointed out that being the case SOMEBODY was buying down the note with prepaid interest. He admitted that it did cost hime to prepay the first year's finance charges. I then said, "So this is costing you another 10% off your offer?" He agreed that was true. I said, "Fine! Here's a check for $1800... and NEITHER of us will pay finance3 charges!"

His jaw dropped! But he accepted my offer, took my check,, and delivered and installed the next day.

My point: 90-dyas, 1-year, whatever "same as cash" is Hooey! SOMEBODY is going to pay for the use of that money over the "interest free" period, and it's USUALLY the customer. G

to aaron and whomever else asked where one can get discounts:
I've gotten them at grocery stores in the past. You will need to buy a "case" of something (not a six-pack of cokes, but a case of soup or canned vegetables, for instance) -- but if you will buy a case that has not yet been "split" out and shelved, the grocer can and most of the time will give you a 10% discount. They're saving money by not having to pay a clerk to shelf an item, and you're saving 10% off something you want to eat. It's a win-win. They won't offer this -- you have to ask the store manager.
That's just one example. I, too, have also used the discount at other "service" type stores.

MrG, on 10/26/07, makes a FANTASTIC point. I'm a little disappointed in myself for not realizing this. I've always used 'other people's money' if possible. So I've always used same-as-cash offers with no problem. Not anymore! I love bartering and now I'm look forward to more opportunities. Can't wait to hit them with MrG's reality. Thanks MrG! Got any more enlightening ideas?

I own a landscape company in Houston, TX and on occasion a client will ask if they can have a cash discount. I typically oblige them with a 5-10% discount. Most small business's (especially service co.'s) will give you a cash discount. It never hurts to ask and the worst they can do is say "no".

There's a place that will ALWAYS give you
a 10-15% discount. It's the hospital. As long
as you offer to pay the full balance (debit
or even credit card) hospitals will give you
the discount. This works on any size bill
even if it's below $100. Just ask if they'll
give you a discount for paying the full
balance.

Visa/MC/Amex/Discover charge everyone who accepts their cards a % of the total amount. It is a useful bit of info when they say the price is locked. $100 charged - 5%, or $95 is the same either way as far the bottom line is concerned.

I moved into a house and charged the appliances (no fridge, dw recalled for catching fire).
I used a credit card to purchase the items (no payts no interest for 12 months).
It was paid off in 8 months, but the anxiety over this was not worth it.
Pay cash and there's no stress!

I have gotten myself a couple discounts lately.
I bought my wife a baby doll charm necklace and we asked what payment method he perfered. He told us cash
and confirmed what a previos poster said about credit
card companies chargeing him more. He then took about 15 dollars off. so we got 2 kid charms and a necklas
dor 50.00. more recently I was at the mechanic shop going
to get some work done on our paid for van. He told me a brake job would
be 115.00 a fuel filter would be 60.00 and a fuel injection cleaning
would be 89.00. I quickly called another shop and found out they charged 60.00
for the injection cleaning and about 100.00 for the brake job.
I told the guy what i found out and let him know i would be going down the road
if he didn't come off of his price. I ended up getting all 3 service's plus oil
change tire rotation and fluid check for 185 tax and all.

Hey Jess - who responded to 2 cents post. You weren't referencing the right post. 2 cents was talking about the post from Tim,
not Rebekah. Tim financed $7000 to save $300. That is roughly a 4.25% savings. I think I would have bargained taking the business
elsewhere. Anyhow, just thought I would reference you to the right posting.

well we are some stupid ones that fell for the same as cash deal and when things happened that took away the money where were going to pay on this bill it didnt happen and now the bill went from 4000 to 8000 over night. We have called them and asked to have the interest lowered explaining that I will not be working this summer and not have the income this summer to pay it. They said we did not qualify for the hardship program and refused it. Now what?

I currently have a 2003 Subaru, my payments are $432.86 per month and I have 13 payments left. I am wondering if I would be better off continuing to pay my payments until it's paid off and then keeping that car and using the money to pay off other debt. Or if I should sell the car now and buy a cheaper car that would be paid in full now and starting my debt reduction now. Please advise.

Loretta, about the car.. sounds like you'll be paying off about $5000 in the next 13 months..? Depending on how cheap of a car you were thinking you might trade in for -- wouldnt it be ok to just hurry up and roll this car into your Debt Snowball, and pay off the car ahead of time? That would save you the trouble of trading in, saving up cash for another used car, etc. Just pay off the one you have, faster! Good luck

Ask for a deal. This just happened to me two nights ago. I had to replace my hot water heater, and I had my baby emergency fund already in place. So I went to the local Home Depot and got the water heater and all of the needed supplies to install it. I went to the check out and asked the clerk if I would get 10% off if I opened a Home Depot credit card. He said I would, I then told him I do not believe going into debt, and I would like to get 10% off for writing him a check for the purchase. He of course told me he couldn't do that. I then asked who could, his reply, "the manager". Well, let me speak to the manager I asked nicely. After waiting 20 minutes, I finally got to talk to the manager, I told him the same thing that I did not believe going into debt, and I would like the 10% off for writing a check. The manager explained that he gets "perks" if I sign up for the credit card and use it. I calmly replied, "Well you will also get a perk if you give me 10% of for paying cash." He looked at me and asked "What type of perk would that be?" I replied "A loyal customer." He at once turned and looked at the clerk and told him to give me the 10%.

What is the point of all this? It is to remind everyone that it never hurts to ask. I would have never thought to do that until I took FPU. I am so thankful for Dave's ministry. My wife and I have around $34,000 in debt to pay off, We will be debt free within the next 2.5 years.

Thanks Dave!!!!

I purchased an engagement ring a few years ago using "one year same as cash" financing. I set up payments to be automatically paid using bill pay from my bank account. However, in October the bill pay didn't go through on time because of a long weekend (who gets off work for Columbus Day!?!). As the year went on, my automatic payments we still for the original amount and when the payments were done, I still owed $17.92 due to the late fee. Unfortunately, I didn't notice the fee and let it go beyond the 1 year mark where I was instantly charged all of the interest fees from the previous year. At 20.9% interest, I ended up paying over $765 in stupid tax. Play with snakes and you will get bitten.

I hear reference to 12% return on mutual funds all of the time. The auto skit says that is the average.
Is anyone getting this type of return from a Mutual Fund, and If so which one?
Thanks
Gear.

Cash worked for us today, and it was fun. I'm a contract negotiator by vocation, but had not ever used cash as
a bargaining tool. Today we went to a locally owned furniture store's discount outlet and after
identifying a suitably deeply discounted discontinued bedroom set, we asked for an additional concession.
The sales person "called his manager" and came back with an offer to split the difference. As he was
explaining this, we took the cash out of our envelope. We shook our heads and said that just wasn't
good enough,we'd continue our search, and my husband began to move the money back into the envelope and
into his pocket. The salesman ask if that was the $1000 cash we'd been willing to pay, and when we
responded that it was, he said "the sales manager can beat me up later. Let's do it." And we did!

I have done the 12 months same as cash deals before on a few things and luckily Murphy never knocked on the door. However, after reading Dave's books, I am not a betting man and will never tempt Murphy again. He is always ready and waiting.
Cash is king and nothing lights up a salesman's eyes more. Always, always ask for a cash discount on every big ticket item.

I pay with cash I pay the full price. I wold never dream of asking for a discount. That's called fraud in my book, not bargaining.

My comment is to Barbara Weatherly's post on 1/10/09.

Would you pay sticker price for a car? I sure hope not!!

Why the heck would you pay the sticker price for anything else!!

Your're just being ignorant, by saying that somone who gets a deal is commiting FRAUD!!

If I were a betting man I'd say that the stores, dealerships, and Service people out there love dealing
with you!!

The great P.T. Barnum said there's a sucker born every minuet.

I'd have to say that I love lets make a deal, but I must admit I've fallen for the 12 mos same-as-cash
deals too (even though I have the money already in the bank). After seeing the light I think I'm gonna run down to the stores and pay them off!!

My wife and I own a salon/spa and we regularly offer wedding groups or ladies days out discounts of 10%. Our credit card processor charges us 1.75% plus .20 cents of each transaction, so on a $100 transaction 1.95 is credid card fees and not usually discounted for cash customers. We run other specials that cash customers can take advantage of which amounts to more than the 1.95.

Tim and Kat:

Would holding on to that $7,000 and making 4.25% on it ($300), and bearing all the risk for what happens for nearly a whole year, make sense if you could save 10% ($700), or even 5% ($350), making a cash deal?

Consider some of the points other people here made. SOMEONE is paying for the use of that money in the same-as-cash package for a wyear, and you can be pretty darn sure they're paying more than 4.25% for it. You can likely save the VENDOR money if you pay cash with a 5% discount. Same is true if they're not offering same-as-cash, but are just accepting credit cards--they're likely paying the credit card companies 3-5% of the transaction amount. That means that anyone who accepts credit cards should be willing to accept a 3-5% discount at least for cash.

Given the even higher costs of financing same-as-cash deals, anyone who offers them should be willing to accept a 5-10% discount for cash. If they actually know their business, they will see that this is the SAME deal, except the money is only going between you and them, not to some third party financier. And they earn your good will by giving you the discount while avoiding risk--intangible benefits, yes, but free marketing.

As commonly accepted as credit cards are, and as common as financing deals are, you should be able to get at least a 5% discount for cash ANYWHERE (for major purchases).

In other words,the VENDOR would be a FOOL not to deal with you and give you a discount, because he wouldn't understand his own business. And YOU would be a FOOL to play risky games to try to make 4.25% when you could save 5-10%. So Tim's deal was a deal made in ignorance that most likely COST him $50 to $400 had he been willing to negotiate with cash--and the VENDOR would likely have been better off if such a deal had been made, as well.

Tim and Kat:

Would holding on to that $7,000 and making 4.25% on it ($300), and bearing all the risk for what happens for nearly a whole year, make sense if you could save 10% ($700), or even 5% ($350), making a cash deal?

Consider some of the points other people here made. SOMEONE is paying for the use of that money in the same-as-cash package for a wyear, and you can be pretty darn sure they're paying more than 4.25% for it. You can likely save the VENDOR money if you pay cash with a 5% discount. Same is true if they're not offering same-as-cash, but are just accepting credit cards--they're likely paying the credit card companies 3-5% of the transaction amount. That means that anyone who accepts credit cards should be willing to accept a 3-5% discount at least for cash.

Given the even higher costs of financing same-as-cash deals, anyone who offers them should be willing to accept a 5-10% discount for cash. If they actually know their business, they will see that this is the SAME deal, except the money is only going between you and them, not to some third party financier. And they earn your good will by giving you the discount while avoiding risk--intangible benefits, yes, but free marketing.

As commonly accepted as credit cards are, and as common as financing deals are, you should be able to get at least a 5% discount for cash ANYWHERE (for major purchases).

In other words,the VENDOR would be a FOOL not to deal with you and give you a discount, because he wouldn't understand his own business. And YOU would be a FOOL to play risky games to try to make 4.25% when you could save 5-10%. So Tim's deal was a deal made in ignorance that most likely COST him $50 to $400 had he been willing to negotiate with cash--and the VENDOR would likely have been better off if such a deal had been made, as well.

Tim and Kat:

Would holding on to that $7,000 and making 4.25% on it ($300), and bearing all the risk for what happens for nearly a whole year, make sense if you could save 10% ($700), or even 5% ($350), making a cash deal?

SOMEONE is paying for the use of that money in the same-as-cash package for a year, and you can be pretty darn sure they're paying more than 4.25% for it. You can likely save the VENDOR money if you pay cash with a 5% discount. Same is true if they're not offering same-as-cash, but are just accepting credit cards--they're likely paying the credit card companies 3-5% of the transaction amount. So anyone who accepts credit cards should be willing to accept a 3-5% discount at least for cash.

Given the even higher costs of financing, anyone who offers them should be willing to accept a 5-10% discount for cash. If they actually know their business, they will see that this is the SAME deal, except the money is only going between you and them, not to some third party financier. And they earn your good will by giving you the discount while avoiding risk--free marketing.

As commonly-accepted as credit cards are, and as common as financing deals are, you should be able to get at least a 5% discount for cash ANYWHERE (for major purchases).

In other words,the VENDOR would be a FOOL not to deal with you and give you a discount, because he wouldn't understand his own business. And YOU would be a FOOL to play risky games to try to make 4.25% when you could save 5-10%. So Tim's deal was a deal made in ignorance that most likely COST him $50 to $400 had he been willing to negotiate with cash.

Tim and Kat:

Would holding on to that $7,000 and making 4.25% on it ($300), and bearing all the risk for what happens for nearly a whole year, make sense if you could save 10% ($700), or even 5% ($350), making a cash deal?

SOMEONE is paying for the use of that money in the same-as-cash package for a year, and you can be pretty darn sure they're paying more than 4.25% for it. You can likely save the VENDOR money if you pay cash with a 5% discount.
Given the even higher costs of financing, anyone who offers them should be willing to accept a 5-10% discount for cash. If they actually know their business, they will see that this is the SAME deal, except the money is only going between you and them, not to some third party financier. And they earn your good will by giving you the discount while avoiding risk--free marketing.

In other words,the VENDOR would be a FOOL not to deal with you and give you a discount, because he wouldn't understand his own business. And YOU would be a FOOL to play risky games to try to make 4.25% when you could save 5-10%. So Tim's deal was a deal made in ignorance that most likely COST him $50 to $400 had he been willing to negotiate with cash.

I just save $35 per month on my cable bill.

I simply called me cable company to downgrade my services in order to reduce my monthly bill. My call was routed to the "Retention" department. They gave me a promo discount without taking any of my services away or downgrading. This was in order to "make me happy", he said. I asked how long this discount would last. He said it would last for 6 months. I said "and then what?". He said I should call back in 6 months and do the same thing all over again. With high speed internet and preferred cable TV, we were paying $147.84 per month. Now our total per month will only be $100.18. Just make a call and ask!

Tim of 9/2/07 "saved" $300 by making interest for 11.5 months. While that seems good, what if you have walked in there and said, I'll pay $6,500 today" instead. Since money talks, I would bet Time would have received an instant 7% 'gain' on his money instead of waiting 11.5 more months to make 4.5%. In hard numbers, that's $200 more.

I have $2,120 left today to pay off a $10,000 window job which was "12 months free financing" --IF you pay it off in full before the due date. Trouble was that the due date switches before the 12 months were up, and you are supposed to pay it off BEFORE the due date. I paid $843.60 in finance charges even though I paid $3,000 and transferred the other $7,000 to a 0% interest for 18 months credit card deal. I HATE GE Project Line and for falling into the sales trap set by the high-pressure window salesman. While I paid $5,000 too much for 10 windows (3 are still not installed 3 years and 2 months later), I also have been sweating it all out for the last 17 months trying to pay it all off before the July 2009 due date on the 0% credit card so I don't pay another dime to anyone for that purchase.

I took Financial Peace University a year ago, and I know what it will be like to pay cash without the the venomous sting of creditors or falling prey to salesmen; both have bitten me hard. I will be debt-free in August except for my mortgage, and with the extra $625 I'm now able to throw at debt beginning this month, I will be sitting with $3,150 cash by Christmas. I already know what it's like to have a cash Christmas thanks to Dave Ramsey. You can try to make a little savings, or you can learn from Dave Ramsey how to put your whole financial picture in focus.

One more reason to follow Dave's advice in gaining freedom was SATISFYING. This last November, the bank called and said the Overdraft Protection annual fee was going up to $30, BUT each over-the-limit transaction was also going to include an additional $30 fee along with the 18% interest. (You know what the real late payment date for your mortgage is the 16th of each month, but every now and then I'd have the mortgage payment run under the balance). I not worried anymore about overdraft protection and canceled the service. Instead, I took my $1,000 Emergency Fund money and stuck it into the checking account so I don't have to worry about any overdrafts again. Do I worry about money? Not like I used to because of D-A-V-E. I'll pay cash for my 'new' car in December!

Here's my cash story. I wanted to buy a big-screen TV. I saved up my cash budget and put it in my pocket. Went to the biggest wheeling-dealing store I could find in my area. Told the (commissioned) salesperson that I wanted buy TV model X and I pulled "my friends" Andrew, Ulysses and Ben out of my pocket. Then we started to dicker. He called his boss over and the boss told me "We make more when people buy on credit then when they pay cash." But I could tell the salesperson REALLY wanted to get to know my friends better so he said "wait here." Well he came back a few minutes later with a great deal on a similar model TV, plus 3 years warranty servie and replacement which they would have tried to sell me. I spent under my budget and my salesperson was happy to make a wad of new friends. Don't let them tell you cash doesn't work - it does, especially with small business and commissioned people.

I'm not much of a negotiator, but after reading these posts, I got up the nerve to call our satellite company, DirecTV. I explained that
our local cable company was offering me a deal to switch. At first DirecTV offered me a so-so deal on a lesser package, but when I told
them I wanted to stay with my current package they gave me a $20 discount on my $56 package (that 36%) for six months and said to call
back at the end of that time to extend the discount. Thank you, DAVE. And to my fellow posters, go for it!!!

Why didn't I do this a year ago?