According to the 2011 CES, most spending on services goes for auto repairs and home remodels—both of which merit their own checklists (see Chapters 41 and 46). For now, let’s focus on more routine services. These tend to cost less, get hired more often, and take less time to complete. They involve formal bids only rarely. Examples include barbers, dry cleaners, tutors, carpet cleaners, watch repairers, computer geeks, plumbers, and daycare centers.
As with the products buying checklist, this chapter summarizes the advice you might receive if any frugal fringers weighed in on your miscellaneous hires. To keep you organized, their advice appears in a system of six strategies:
(1) avoid the service completely;
(2) avoid the service in part;
(3) run background checks;
(4) find low rates;
(5) avoid common pitfalls; and
(6) follow up the hire.
Appendix 2 distills all of this into a very serviceable checklist.
8.1 Avoid the Service Completely
Here’s a smorgasbord of alternatives to evade the entire hire.
□ 8.1.1 Skip Discretionary Services
So many niches sap away our riches: fitness trainers, masseuses, manicurists, pedicurists, event planners, auto detailers, errand services, and professional organizers. All these services are discretionary. Sidestep them and save.
□ 8.1.2 Delay and Hire Later
Simply procrastinate. This lets you seek out second opinions and gives you more time to shop around. If you need a repair, for example, buy yourself some time with duct tape, patches, or glue. Sometimes, a stopgap fix even provides a long-term solution.
□ 8.1.3 Replace High-Cost Services With Low-Cost Products
A reliable product often undercuts the cost of a service.
- Safe Deposit Boxes. Don’t pay bank rentals year after year; instead, install a home safe.
- Private Schools. Buy a home in a good public school district and ditch tuition costs.
- Lawn Services. Supplant grassy yards with sparse xeriscapes. Visit LessLawn.com.
- Exterminators. Rid yourself of this pesky expense. Set mousetraps yourself.
- Caterers. Purchase takeout instead.
- Upholsterers. Buy slipcovers.
- Dry Cleaners. Use home kits from Custom Cleaner, Dryel, or FreshCare.
- Hair Stylists. Replace beauty salons with home dye kits; replace barbershops with clippers.
□ 8.1.4 Rid Yourself of Products With High Service Costs
Steer clear of high maintenance products. When you buy washable clothes, you liquefy the cost of dry cleaners. When you choose push mowers, wheelbarrows, and scythes, you avoid small engine repairs. When you play electric keyboards, you save on piano movers and tuners. If your need for a service-heavy product is unavoidable, but only occasional, rent, borrow, or flip. This way, someone other than you pays for upkeep.
□ 8.1.5 Perform Lower Skilled Services Yourself
Although big spenders could perform many tasks themselves, they choose to pay someone else instead. Not so with the frugal few, where self-reliance is a way of life.
- Housekeeping. It’s good exercise and almost anyone can do it.
- Courier Service. Hand-deliver packages yourself; scan and email documents.
- Home Moving. Host the modern equivalent of a barn raising. Invite able bodied friends.
- Lawn Care. Dust off the mower; get some exercise.
- Chimney Sweeping. Obtain the brushes from a rental center.
- Carpet Cleaning. Rent a machine and save $300-$500 off professional cleaning.
- Window Washing. Buy the same tools that experts use.
- Painting. With time and patience, you can do it yourself.
□ 8.1.6 Study Higher Skilled Services and Do Them Yourself
We live in a golden age of DIY. Well-produced videos show instead of tell us how to do things we’ve never attempted before. Tap into this informative treasure trove and expand your skills set.
- Music Lessons. Buy instructional DVDs on eBay.
- Life Coaches. Self-help books abound; visit the library or Amazon for choices.
- Bike Repairs. Visit YouTube.com. Borrow a how-to DVD from your library.
- Interior Decorating. Buy DIY software from Amazon or borrow books from the library
- Tax Preparation. Join the IRS’s Volunteer Income Tax Assistance (VITA) program and grow your knowledge as you help others. Visit VITA-Volunteers.org.
- Legal Forms. Prepare basic legal documents yourself. For how-to books, visit Nolo.com. For software, visit LegalZoom.com.
- Real Estate Brokers. The standard commission on a $300,000 house is $18,000. DIY and save. Visit HomesByOwner.com. For the latest how-to books, visit your library.
8.2 Avoid the Service in Part
With these alternatives, you save by restricting the amount of work the service performs.
□ 8.2.1 Hire, but Do Some of the Work Yourself
Mix and match someone’s expertise with your own sweaty efforts.
- Tree Removal. Hire expert lumberjacks to drop large conifers without severing power lines. Once the pines lay supine, do the grunt work: trim, cut, split, and stack.
- House Painting. Your home has high peaks that make painting a sketchy job. But you can still tackle the lower work yourself. Negotiate a deal where the painter takes responsibility for the high stuff only and you cover the rest.
- Window Washing. Same idea as painting: hire experts for hard-to-reach areas and handle the lower windows yourself.
- Service Travel. If you drive your computer to the repair center, you sidestep the technician’s travel expenses.
- Carpets. Move furniture and pull up old rugs before the installers arrive.
- Moving. A truck delivers a large bin, which you fill with belongings. Later, it hauls the bin to your new home, where you offload the contents. Visit UPack.com or Pods.com.
□ 8.2.2 Hire, but Procure Materials Yourself
Services simply buy whatever they need and pass along the cost, often with hefty markups. You have far greater incentives to control expenses than they do. Get involved in procurement, and save big.
- Caterers. Borrow tables and chairs from your VFW or church, and you won’t have to pay the caterer to rent them for you.
- Movers. Supply the boxes yourself. Visit a grocery store or UsedCardboardBoxes.com.
- Computer Upgrades and Bike Repairs. Find quality parts on the internet and take them to experts for installation.
- Lawn Services. If you already own a lawnmower, hire a neighborhood kid instead of a well-equipped professional.
□ 8.2.3 Hire Advisors, and Do the Actual Work Yourself
Retain a service for expert advice only.
- Landscaping. Hire knowledgeable designers, but shoulder the burden of moving rocks and shrubbery.
- Lawyers. Most household budgets can’t sustain the burden of legal fees. However, if you’re embroiled in small litigation and don’t want to give in, retain an attorney for advice about how to represent yourself.
- Interior Decorators. Pay them to recommend the best colors, textures, and materials. Armed with their advice, you can move forward from there.
- Certified Public Accountants. Hire them for any complicated tax issues, but complete the return yourself.
□ 8.2.4 Hire Less Often
If you visit a barber every other week, you spend $4,680 over a decade. If you visit only once a month, you save $2,340. In between trips to the barber, trim the hair yourself (that’s cutting back, quite literally). This tactic works for many common services:
- Hair Dyeing
- Lawn Service
- Pool Cleaning
- Carpet Cleaning
- Pet Grooming
- Personal Chefs
- Personal Trainers
- Yoga Classes
- Golf Lessons
- Baby Sitters
- Dry Cleaning
- Car Washes
- Auto Detailers.
A caveat: don’t skip services to maintain your most valuable property (houses, vehicles) or to protect your health (dental checkups, physicals). Never go cheap on that which is most precious.
□ 8.2.5 Hire Basic Services Only
Services love to add bells and whistles that line their pockets, but add little value for consumers. Decline extras and save.
- Car Washes. Have them wash the exterior, but forgo any undercoating, vacuuming, and detailing.
- Barbers. All you need is a haircut, so go without shampoos or special styling.
- Lawn Services. Have the service cut the grass, but decline its offers to spray and fertilize.
□ 8.2.6 Practice Preventative Maintenance
In the long run, regular maintenance costs less than major repairs. Follow owner’s manuals. Find additional advice for upkeep at chat rooms, forums, and discussion boards.
8.3 Run Background Checks
Whenever you hire a service, the most important task is to find someone honest and able. Dishonesty or shoddy workmanship inevitably costs more than whatever was saved by picking the cheapest option.
□ 8.3.1 Look for Customer Feedback
□ Consider Your Own Experience. If you hired someone in the past and liked the results, stick with who you know.
□ Seek Recommendations. People you trust are the next best source of information. Ask for the gritty details. Here are some examples:
- “Were you satisfied with the quality of work?”
- “Was the work completed on time?”
- “Were you satisfied with the level of communication?”
- “Was there a written contract?”
- “Was there a good overall working relationship?”
- “If there were any disputes, were they handled well?”
- “Were there any negotiations on rates or job pricing?”
- “Is there anything else I should know?”
□ Read Internet Reviews. Various websites provide—or purport to provide—unbiased customer feedback. Although your own experience or friends’ advice works best, review sites work better than phonebooks. AngiesList.com boasts a large database that rates all kinds of services, but it charges a monthly fee for access. One frugal approach: join for one month only, research any services you might need for the next few years, and then cancel your subscription.
□ Visit the Better Business Bureau. Before hiring anyone for the first time, check with the BBB. Avoid services that receive frequent complaints.
□ Check Out the Service’s References. Any service should be able to provide a list of satisfied customers. Call several and ask the same gritty questions listed above.
□ 8.3.2 Hold Tryouts
Audition services before you spend on a large scale. For example, attend a few spin classes before you hire the leader as your personal trainer. And retain a plumbing service for small repairs before you hire it for any major projects.
□ 8.3.3 Review Samples of the Service’s Work
Ask to see examples of workmanship. Many services maintain portfolios on DVDs or websites.
□ 8.3.4 Review Qualifications
□ Consider the Time in Business. Check how many years the service has been around. Dishonest or incompetent operators don’t survive for long.
□ Look for Trade Memberships, Certifications, and Licenses. Many trades regulate themselves by issuing proof of competency such as diplomas or certificates. Governments license a wide variety of vocations; visit your state’s official website.
□ Know the Level of Specialization Required. If your needs are straightforward, hire generalists. If they’re complicated, hire specialists.
□ Know the Level of Experience Required. For easier jobs, hire the young and eager who are in the early stages of their careers. For tougher tasks, favor those with greater experience.
□ 8.3.5 Learn the Service’s Policies
The more expensive the service, the more you should study its policies.
□ Review the Contract. Read over the forms, including any warranties and guaranties. Favor services that provide greater protections.
□ Ask Who Performs the Actual Work. Is it the owner or unlicensed underlings? If it’s underlings, investigate their qualifications. After all, you have to live with the results of their work.
□ Watch for Unusual Fees. Ask for a complete list upfront.
□ 8.3.6 Weigh Your Own Time Costs
Don’t become overly enamored with the research process. The less costly the service, the less time you should spend vetting it.
8.4 Find Low Rates
After you locate qualified services, find out which ones offer the lowest prices.
□ 8.4.1 Shop Around
□ Compare Prices on Your Shortlist of Prospective Services. Ask for their hourly rates and also whether they impose any unusual fees, including surcharges for credit card payments (see 8.3.5).
□ Ask Friends. Find out if they’ve hired a similar service and what they paid for it.
□ Seek Special Offers on Prices. Some examples:
- Introductory Rates. Many services offer discounts to first-time customers.
- Coupons. Commonly used to promote oil changes, haircuts, and carpet cleanings.
- Group Discounts. AAA, AARP, and similar groups publish lists of services that offer member discounts. The checklist reminds you to review these before you hire.
- Volume or Loyalty Discounts. Such as discounted gift cards, point programs, and punch cards (buy nine haircuts and your tenth is FREE).
- Form of Payment Discounts. Pay cash if the discount exceeds the value of your card’s rewards.
- Deal-A-Day Websites. Sign up for LivingSocial.com and Groupon.com.
□ Seek Deal Sweeteners on Terms other than Price. Fee waivers, freebies, free estimates, etc.
□ Avoid High Overhead Operations. The costs of fancy offices, new trucks, and big operations get passed on to customers. Favor providers with good reputations and modest infrastructures.
□ 8.4.2 Haggle
□ “Can you match your competitor’s rates?” Show written proof of other offers.
□ “If I commit to use your service more often, would you lower your rate?” Negotiate a volume discount.
□ “I know you have overhead, but can you get closer to the online rate?” Bring printouts of website prices.
□ 8.4.3 If Warranted, Seek Bids in Writing
Don’t bother with bids for inexpensive tasks, but for larger projects, seek written offers.
□ 8.4.4 Consider Online Services
Consumers have warmed to web-based stockbrokers, matchmakers, and travel agents. Check out these other online services.
- Tax Advice. Visit HRBlock.com or TurboTax.com.
- Computer Repairs. With remote access software, experts take control of your computer and fix any problems as you watch. Visit OnlineComputerRepair.com, ComputerGeeksOnline.net, AskPCExperts.com, and BoxAid.com.
- Fitness Training. Visit inerTrain.com.
- Tutoring. Real teachers help school kids at prices that undercut local learning centers. Visit Tutor.com, SmarThinking.com, TutorVista.com, or HomeworkHelp.com.
- Piano Lessons. Scale down this expense at ZebraKeys.com.
- Expert Advice. Precise information can help you decide whether to hire or DIY. Take a picture of your problem and post it along with your questions. Visit JustAnswer.com to receive online opinions from mechanics, doctors, plumbers, electricians, and others.
□ 8.4.5 Consider Trainees, Students, and Responsible Teens
Many schools offer teacher-supervised services for less, including those for dental hygienists, barbers, and veterinarians. Submit your legal problem to a law school clinic. Scour the neighborhood for youngsters who walk pets or care for lawns.
□ 8.4.6 Share Services With Others
Split the cost of babysitters with neighbors. Sign up with friends for golf lessons. Jointly hire personal trainers. Band together with others and negotiate volume discounts on tuxedo rentals. (Once again, it’s Group Buynamics in action.)
□ 8.4.7 Anticipate Emergency Hires
Emergencies can derail the best laid savings plans. If you wait until a crisis actually hits, you play Russian roulette with the prices. Plan ahead. For each foreseeable service you might need, find several candidates in case your first choice is unavailable in your hour of need. Copy this list, fill it up with telephone numbers, and tape it to your fridge.
Service No. 1 Service No. 2 Service No. 3
A/C and Furnace
□ 8.4.8 Trade or Barter Services
Exchange your own expertise for someone else’s: tax preparation for brake jobs, prepared meals for housekeeping, kid watching for the same in return. Naturally, the IRS wants to get involved, and the tax complications are more than annoying. To dip your toe into the morass, download IRS Publication 525. Consult a tax advisor.
□ 8.4.9 Insure
You can buy all kinds of insurance to cover routine services, but usually you’re better off creating an emergency fund for the inevitable small disasters. Insure for major risks only: health, home, auto, and, if you have dependents, your life.
- Vision. Instead of buying insurance, follow Chapter 35.
- Dental. Don’t buy coverage; instead, use the dental care checklist (see Chapter 36).
- Major Repairs. For large appliances, buy reliable brands and self-insure for any breakdowns.
- Legal Services Insurance Plans. Unless your interaction with the law is constant, pay for lawyers as the need for them arises.
8.5 Avoid Pitfalls
□ 8.5.1 Require a Physical Address
Beware of local businesses that only list a P.O. Box—it’s often a red flag for a sham operation. Before you hire, drive past headquarters and look for signs of a legitimate business: equipment, parking, foot traffic, etc. (In contrast, small online service providers commonly use P.O. boxes, and it’s not a red flag if you see ample positive reviews.)
□ 8.5.2 Never Hire Anyone Who Contacts You First
Beware of anyone who knocks on your door. You decrease your chances of hiring a fraudster if you identify prospects based upon thorough background checks.
□ 8.5.3 Avoid Quick Hiring Decisions
Don’t rush; adhere to the checklist.
□ 8.5.4 Hire the Right Level of Specialization
Generalists charge less. Hire specialists only for complex projects.
□ 8.5.5 Hire the Right Level of Experience
Hire experts for complex work; otherwise, hire the young and eager.
□ 8.5.6 Avoid Unnecessary Hires
Plan ahead to meet your true needs and seek second opinions.
□ 8.5.7 Never Pay for Work That Isn’t Performed
Whenever possible, try to observe any work in progress.
□ 8.5.8 Decline Oversells and Upsells
Beware of project creep. Favor the original scope of work over spontaneous suggestions that increase your costs.
□ 8.5.9 Read Contracts Before Signing Them
Always read contracts before you sign. If you see unclear language, seek help from a trusted friend or advisor.
□ 8.5.10 Never Use Debt to Fund Discretionary Services
Don’t pay interest on discretionary services. Do without or DIY.
□ 8.5.11 Research all Recommendations
Services often make referrals in exchange for kickbacks from those they recommend. Don’t accept any referrals that you haven’t run through the gauntlet of this checklist.
□ 8.5.12 Beware of Deals “Too Good To Be True”
Beware of extremely low offers. They’re often red flags for fraud.
8.6 Follow Up
Minimize future hassles with these tactics.
□ 8.6.1 Inspect Work
Check the workmanship. If anything’s amiss, have it made right.
□ 8.6.2 Oversee Touch Ups
Make sure the service performs any fixes to your liking.
□ 8.6.3 Check for Math Errors
Yes, you’ve hired someone smarter than a fifth grader, but check anyway. Make sure the correct rates and hours have been applied.
□ 8.6.4 Monitor Sales Taxes
Most jurisdictions don’t charge sales taxes on services, so they shouldn’t appear on the bill.
□ 8.6.5 Agree to the Form of Payment
Discuss whether discounts are available for payment in cash. If not, pay with plastic and reap the rewards.
□ 8.6.6 Don’t Pay Until You’re Satisfied
Your best leverage for quality work is the final installment.
□ 8.6.7 Build a Long-Term Relationship
If you’re 100 percent satisfied, show your appreciation. Say thank you, offer to make recommendations, or, if appropriate, leave a tip.
□ 8.6.8 Make the Work Last
Ask your service provider for advice about upkeep.
□ 8.6.9 Retain Paperwork
Keep a file in case of future disputes. This information also helps if any friends ever need the same service.
□ 8.6.10 Consider Possible Tax Impacts
Services with potential tax ramifications include auctioneers, movers, stockbrokers, real estate brokers, and tax preparers. Consult your tax advisor.
□ 8.6.11 Keep Motivated With a “Checklist Savings Log”
Finally, each time you complete a hire, enter your savings into a “checklist savings log” that tracks your progress and reinforces your SLN! habit. After all, you’ve just stashed away money that most consumers would have willingly surrendered. It’s time to celebrate with a modest use of metrics. For details about logs and other motivational tools, read Chapter 47.
* * *
You now have at your fingertips a frugal system for hiring miscellaneous services. For a condensed version that reduces all this into a few pages, see Appendix 2.