How much do we miss out on because we fail to do one really simple, free and easy thing. This one thing can greatly improve your finances. Amazingly, it can lower the interest rate you pay on a home equity. It can eliminate the balance transfer fee on a credit card. It may get you a raise at work or more money at your next job. And I know from experience that it can get you more investing options in your company’s 401k plan.
And this one thing has applications far beyond money management. It can improve just about every area of your life. So what is this one thing?
Asking questions. Now, before you hit the backspace on your browser, at least give me a chance to show you just how powerful getting up the nerve to ask for something can be.
Home equity line of credit: Have you ever thought to call your home mortgage company and ask them to reduce the interest rate on your home equity line of credit? Most equity line interest rates are set in relation to the prime interest rate. For example, you may be paying prime + 1, meaning your rate is equal to the prime rate plus 1%.
When I opened a home equity line in 2004, my rate was prime + 75 basis points, meaning prime plus 0.75%. After about 2 years of on time payments, I called up and asked for a lower rate. To avoid losing a customer, they lowered my rate to prime – 50 basis points. That one phone call has saved me literally thousands of dollars over the last several years.
Increase in salary: In my last two jobs, when I was offered a starting salary, I asked for more. In both cases they gave me about 5 to 10% more than their original offer. Taking the time and having the nerve to ask for more resulted in thousands of dollars in additional income.
401k Options: At my current job, our investing options in our 401k were just dreadful. So several of us starting asking if the company would add options. Nothing happened at first, but after about a year or so, they did. We went from about 10 options to over 200! Now not all 200 investing options are great. Some come with ridiculously high costs. But many of the new options are a vast improvement over what we had before.
Balance transfer credit cards: Recently I wrote about whether one should sell investments to pay of credit card debt. My plan is to move the debt over to 0% balance transfer credit cards. I applied for and was approved for the Kiva credit card (15 month 0 APR balance transfer), but it did not cover the entire debt. I had a 12 month balance transfer offer from Discover, but the offer did not have a cap on the transfer fee. So I called up Discover and asked them to cap the fee. Discover said NO!
Which brings me to an important point–get ready for rejection. You’ll hear “no” a lot in this business of asking. But just remember this Chinese proverb:
He who asks is a fool for five minutes, but he who does not ask remains a fool forever.
As it turns out, however, Discover did have a 6 month balance transfer offer with a capped fee, which I took advantage of. And this brings me to another important realization about asking, from none other than Mick Jagger:
No, you can’t always get what you want
You can’t always get what you want
You can’t always get what you want
And if you try sometime you find
You get what you need
The keywords are highlighted there for you. “And if you try sometime,” that is ask, you may be surprised by the results. So let me be the first to give this a try and ask for comments that describe how you improved your finances just by asking.