The Power of FI
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To sum it up it has been one hell of an expensive month. In the past 30 days I have had the following unexpected expenses come out of the blue,
Yah that’s right I have had over 9,000 dollars in unplanned and unanticipated expenses come out of nowhere and punch my bank account right in the face. But despite all these unplanned expenses I am not going to go hungry, I am not going to miss a mortgage payment, and I am not going into any credit card or other debt because of all this.
If you are already wise to the power of FI then this will come as no shock to you. Anyone that has been on the road to financial independence knows that while this is a annoying set back it doesn’t really affect me because of the money saving systems that I have in place to make sure that I will always have money for unexpected things that happen every now and then.
But through this experience I and the missus had the chance to practice some of the techniques that someone pursuing FI can do to maximize the effectiveness of their money in both planned and unplanned expenses.
This is of course the practice of matching a price usually found online for the goods or services that a business provides. In this particular case we had to get a last minute hotel room that would also accommodate a pet. As we were slowly crawling towards our destination with me white knuckle driving the wife began to look up hotels and prices. By the time she was done she managed to get a room that would normally have cost us around $95.00 for around $66.00 just because she managed to find a good online deal.
We didn’t even have to book the room online to get that price we just showed up to the hotel and showed them the deal we found and that’s the rate they gave us. Price matching can be used across many industries and many situations so it nearly always pays to look.
Upfront Cash Payment
In todays world of credit cards, mortgages and people budgets stretched to the max it is rare for the average joe to pay for any large item entirely with cash up front. This has led to an expectation from businesses that any large ticket item like cars, health care bills, or in my case a new furnace will come with financing in one form or another. A lot of these business even offer the financing themselves for a certain rate. But this financing comes not only at a cost for you in terms of interest payments but at a cost for the business you are working with. Rather than being a onetime exchange of payment for a service they now must track how much money they still need from you and hound you for that payment. This is a headache for a bank whose sole job is keeping track of money much less a HVAC company or a hospital.
So when working with a company it pays to ask them is they are able to give you a discount for paying the entire bill upfront. Many small business and hospitals will jump at this chance because it eliminates work for them and guarantees them their payment. I was able to put this technique to use on my recent furnace replacement quite effectively. After we had decided on what we wanted and had received our quote I asked about a getting a discount for upfront payment. Luckily, we were talking with the owner of the company and he said he would be willing to give a 8% discount of our bill if we could pay in cash.
That added up to around 800 dollars in savings off our bill dropping it from over 9,000 to 8,500. Just by asking and by having the means to back it up we were able to save serious money on something we needed.
This furnace and the hotel room were the first times I really got to test out my new found power with being more financially secure and knowledgeable. By knowing that I can ask for discounts and that places really will honor lower rates you bring to their attention it has opened my eyes even more to the power of negation and the Power of Fi.
The Moral of the Story
Once you begin to get real savings built up behind you the options for taking control of your money and your life really begin to happen. You will be amazed at the power you have in your life when you are debt free, can buy a car in cash and when a $10,000 bill doesn’t send you into financial ruin. I’m not there yet but I can feel it coming, I can feel the Power of FI building in my life with each dollar saved, each useless item not purchased and each deal negotiated to my benefit.
The Power of FI is real and boy does it feel good.