Explaining the Starting Rate of Savings

BBC Sounds Music, Radio Podcasts As that was substantially cheaper than the April price cap, you have been saving since then. We do not have a right to a cheaper price, but they do not have a right to our customs. My mate to school always used to say I'd end up with a brown maxi. I'm on a fix, I should fix. No in the right industries you can often say a shedler. Olivia in the trap. Hello, I'm Martin Lewis and this is the cunningly named the Martin Lewis podcast. I do wonder what that's going to be about. And this is our big topic episode where each week we lead on a main subject to help you save. Now much of it comes from my BBC radio five live show with Adrian Chiles, but there's also bonus money saving tips and tricks just for you lucky lucky podcast listeners . In today's episode, our big topic is haggling, specifically call centre haggling for broadband TV, breakdown cover, insurance firms and more. Many can save hundreds of pounds a year with just a simple phone call. I'll tell you the top ten big firms to haggle with. I'll give you my top haggling tips , but also we've got top tips that call centre staff has told us too , including one that I genuinely found really shocking. Plus, with the agreement to extend the ceasefire in the Middle East, wholesale energy prices have dro pped. So what does that mean for domestic energy bills? When will they get cheaper and is now the time to fix? And in this week's Money Mastermind, it's all about a tax free savings allowance few know about. Will Adrian? We'll see. Play the theme trees Mark and I understand you haven't got your BBC pass with you and that actually means you don't exist. You're a n on. person I have a temporary pass agent. Am I a temporary person? You're a temporary person, but very temporary. It only lasts the day, then you cease to exist again. You haven't, you haven't lost it completely, have you? You haven't your pass. Somewhere between being in the studio last week and leaving the door of the studio my past disappear. The consequences for this are grave. It's the most unbelievable amount of faff . We might in fact I don't feel as if I can broadcast with you. I think I'll have to ask you to leave. Fine. No, actually don't go till one o'clock then you might well be led away. I wish you well on your journey with building a new person. No, I've been there before I'm not happy . Energy bills, then what are we what are we thinking now in the light of peace breaking out at least temporarily? So it depends which bills you're talking about. I think it was worth starting. I have a graph in front of me. It is the UK Natural gas price. If you'd like to look at it yourself, I'd go to trading economics and you want UK natural gas. I'm looking at the six month chart and it is really worth a look. I'm going to try and paint you a picture of what's happened because this is what feeds in to the prices that we all pay. Now there are lots of other factors in our energy bills. Policy costs are huge and the cost of the company and the retailers, but the big changeable factor, the thing that moves most rapidly is these underlying wholesale rates. And even though I'm talking about the UK natural gas rate, because so much of our electricity is generated at the final point the marginal call by gas, actually this has, a huge impact on the price of electricity too. So this is the graph that counts if you like. So what you had, you had at the start of the year, while there were a couple of little peaks , you had the price was around seventy to eighty pence was pretty typical. So have that in your head. Let's call that normal. What the relatively recent normal has been seventy to eighty pence . We then had at the start of March, we had the start of the conflict going on in the Middle East and the price immediately shot up to around one pound thirty, one pound forty peaking at one pound fifty , stayed there for a while , dipped just before April down to around a pound again, but then went up to around one hundred and twenty . So the big picture since the Middle East conflict started a move up from seventy to eighty pound to somewhere between one pound and one pound fifty . So you can see that that is, you know, it's a minimum thirty to one hundred percent rise in the underlying rate of wholesale gas electricity . What has happened since the announcement of this treaty that we've come or the ceasefire that we've come? Well, the prices just dipped below a hundred, just dipped below a pound . So it's now at about ninety eight pence . That is less than it has since the conflict started , but it's still nowhere near back to the seventy to eighty p that it was before the conflict started. So prices are still twenty percent more than they were . Hopefully that has given you a rough idea. Now the real what you have to get really complicated here is the impact of those prices how it impacts depends hugely on whether you're tal king about the switchable market, fixes and discount tariffs or whether you're talking about the price cap . The energy price cap you have to understand is time lagged , right? So we already have the price for July and the price for July was there based on the wholesale rates from the middle of February until the middle of May . So about half of that was the Middle East conflict period. The beginning part wasn't. The price for October , the next one that we're going to, is the middle of May till the middle of August. So the first month of the October price cap has been at the high Middle East conflict rates. So that's already locked in because the way the price cap is set is an average of wholesale rates over three months. We already have one month of the three months locked in. So whatever happens, you've got that high start point. So for it to come down a lot, you would need the wholesale rate to come down very much more than it was before the conflict started. I would say to come down a lot, Mike just try and give some actual numbers on that. For the October rate to be cheaper than what we're currently paying because the current rate that we're paying is the April price cap, all of which was before the Middle East conflict, we would need the natural gas price to come down probably to significantly lower than it was before the conflict. That is unlikely to happen and if it does, it will probably be in only the last month of the assessment period. So all of that means it's now looking like the October price cap may be slightly lower than the July price cap but it, certainly will still almost certainly be higher than what we're currently paying. That's what we know. And that, of course, is predicated on this ceasefire sticking . So the price cap and people always say, Oh , they rise quickly, they fall slowly. That isn't true. With the energy price cap , the price rises slowly and falls slowly. They can prove this by the fact that the rise in July is the first rise based on the Middle East conflict which started in March. That will only hit in July, and it will still be hitting in October until the end of the year, even if this ceasefire continues right now . But the price that you can fix at and the price that you can get discounted tariffs at , they tend to very much be based on today's prices . In other words, if you think about it this way, to set a fixed rate, to set a new rate that you can lock in a price at, what a company does massively oversimplifying but gives you a good picture is it says what can I buy energy at today? Okay, I can buy it at that rate I. will So sell it at an equivalent rate with some markup on obviously because it's being retailed to consumers at that rate because I can buy it today and I will buy it for a year ahead and I will buy thirty million pounds worth of that and I'll sell thirty million pounds worth of that plus the marker added on top. And then when that's gone, I'll look at what the new prices are and I'll do a new fixed rate. So the rate of fixes that you can get a fix that moves much more quickly than the price gap . So we've already started to see fixed rates come down a little bit because of this chipping away at the UK natural gas prices . And my prediction is by this time next week, I think that will have got a little bit cheaper again . To put this in perspective , a few weeks ago, you could not get a fix cheaper than the April price cap, the current price cap that we're all on. Last week, you could get it about one or two percent cheaper with the very cheapest on the market , many fixes weren't. My guess is this time next week. I mean, currently we're at about three percent cheaper. We'll probably go to four or five percent cheaper than the April price cap will be the cheapest fixes. So the two things , the rate you can fix at is based on the immediate underlying wholesale rates. The price cap is massively time lagged. So we're going to get to this perverse situation potentially if everything continues in October , that the price cap will still be high based on prices right now, but the market could be entirely different for fixes. So there is a potential that back in October, you know, you could see fixed rates at twenty thirty percent cheaper than the price cap that we've got then. That was a very long answer to the question. I hope it made sense then. It did make sense. Rachel's got a question coming to an end on my gas and electric fixed rate with Octopus wants advice on whether to go on variable or fixed again family, of four with an electric car . So let's just go very, very simple here . Variable rate is the price cap . So we've talked about this before, but I will just reiterate it again because whenever I ask people if they're on the price cap, they don't know if you are not on a fix, if you have not chosen a special deal, if your fix has ended and you haven't done anything, you're on the price cap. So when that question is about variable rate , that means should I go onto the price cap or should I fix ? Well, I mean that you would not wanna why would you go on to the price cap when fixes are getting cheaper right now and the price cap is going to rise thirteen percent in July. I'll probably say somewhere about that level, although it's some crystal ball going into that in October. It might come down a little bit from where it is in July, but it won't be as cheap as it is right now. But you can fix right now at less than the current price cap and that's likely to be the cheapest it'll be for the rest of this year . So absolutely if you're giving me a binary choice between staying on the price cap and going on to a fix I would be moving on to a fix. I mean when you, move on to a fix is a more interesting question, depending on what your current situation is. But compared to being on the price cut, you may as well just burden the hand and sort it out now. The only thing I would note in there is you have an electric vehicle tariff. You have an electric vehicle and you might want to look at EV tariffs. EV tariffs and there are lots of different ones with certain providers like Ovo and Scottish Power, you can get fixes and have an EV add on with other providers when it comes to an EV tariff you get cheap rates for overnight charging and then you pay pretty much price cap rates during the day . So therefore you have a variable element that goes on within that price cap r ate and the question there depends on just how much of a proportion of your home energy bill your electric vehicle charging is. If it's a substantial portion then the EV tariff will be cheaper . If it's not a substantial portion, you may be better off on the f ix. Okay, Brooks Fontini, I have fixed till the end of August. Do I switch to fix now? I haven't got any exit fees, even though it's at a higher rate than my current book will be cheaper if things increase as expected comp first of July or stay put. No, I don't know how you know no, no, no, I can't and I'm not of course I'm not angry with the person calling. I get this question so often. It's completely false logic . Things are not increasing in July because the price cap is increasing in July . The price gap in July is going up because prices between February and the middle of May were high. That's why the price cap goes up in July because it is completely time lagged. It is based on three to five month ago past prices. That's what will happen in July. So the idea that you should fix now because of what will happen in July is a completely false decision. What you're effective, what we have to look at in this case is what will the prices of fixes be in August when my current fix ends . Will the prices of fixes in August be cheaper than I can currently fix? And the prices of fixes in August, the price gap is completely irrelevant for that because the prices of fixes in August are based on underlying wholesale rates . The problem is I can't answer the question because the prices of fixes in August were based on those worldwide markets . If the ceasefire holds and everything continues , then I would expect that you would be able to get a fix in August for less than you can get a fix now because the natural gas factories will be being repaired, the ones that are there and the oil tankers will be coming out of the Straits of Hormuz and things will be starting to flow and things should be improving by then, though I don't think we'll go back to where we were on that basis. That's not my area, but on the stuff I've been reading anyway . So yes, there is a real potential that things in August would improve, but if you're so if you're asking me should I get out of my fix now to pay more now because of the risk that fixes will be higher in August? I think it's predicated on a false underlying assumpt . You know, things look like if we cross our fingers and the ceasefire holds , fixes will be cheaper in August. So you would want to hold on as long as you possibly can on your current fix. Of course , there is a huge amount of volatility, but there's nothing special about fixing right now if you're on a fix. And this is sorry to go on about this Adrian, but I think I've really been struggling with this messaging in my work. I've tried to be as clear as possible. My message has basically been if you're on the price cap, get off the price cap and move on to a fix . If you're on that variable price cap, and lots of people are on fixes are reading that as I'm on a fix, I should fix. No, that advice is for people who are on the price cap where we know what's going to happen. We know it's going to rise thirteen percent or more accurately seven percent on electricity and twenty six percent on gas twenty eight percent on gas coming on the first of July. We don't know what's happening for fix rates . It doesn't apply on a fix , so if you're making the decision should I come off a cheap fix to get a more expensive fix . I mean, you would have to think fixes going to be much more expensive in future than they are now and actually the hope is it will be the other way around I think there's a question from Lisa Campbell and there might be a barb in it. I'm not sure. But it says, What about those that followed your advice? Well, you don't really give advice as such, do you? What about those that followed your advice and fixed in May before the first of July price hike? Will those fixes come down like the first of April or do we just have to accept we drew the short straw this time? Well, if you fixed, I did a call out saying if you're on the price cap, there was a point in May you really need to get off it because wholesale rates have just dipped and you might want to get in now because there were cheap fixes available . At that point from memory , the fixes were about five percent under the April price cap Since that point , you have been fixes got more expensive, so you're only able to fix at best one percent and in some cases you couldn't fix it all cheaper than the April price gap. That's what that call was. So as that was substantially cheaper than the April price cap, you have been saving since May and you were on the price cap. As long as you got a cheap fix, as long as you were if you say you're following what I was saying, then it was about get a cheap fix. And I've never I've always been told people to be careful about fixing it more than the April price cap. So you've been saving. But yes, at the time, and you can go back and listen to the podcast where I talked about it, I said, Of course nobody knows what's going to happen. If a ceasefire comes in, prices could get cheaper and they could get cheaper. And if you fix right now and you're on the price cap, it could be cheaper to wait and fix in six months' time, but you will have been paying more in the meantime. There is no way to judge that market. If you locked in on a cheap fix in May you've already been saving, you'll be paying less than you would have done being on the price gap in July, less than you would have done being on the price gap in October, almost certainly, but you might have been able to get a cheap fix if you waited, but you'd have to pay more in the meantime, but no one knew that. So I would question whether you have drawn the short straw. My actual we're not back. Fixes right now are not as cheap as they were at the point I made the big call in May . So I'm hoping they'll be back to that sort of level next week. Meantime you saved . But yes, I always do the risk analysis. I always talk about the crystal ball element. And you know, for anybody listening, if you're waiting to fix , you may be able to fix cheaper coming October or November or December. I don't know that, but in the meantime you would have paid more. So the exact phrase I used at the time is the risk averse thing to do if you're worried about price hikes is to lock in on a fixed now cheaper than the April price gap. You did that, you saved money, you've achieved the risk averse solution , but there's no way to know if in hindsight it will be the best solution or not, but it would certainly be better than staying on the price cap. I'm not trying to be defensive about that because I've got in fact I remember having a long conversation with my team about communicating this and I said that we have to talk about this in terms of risk because it's so unknowable. So the phrasing must always be about it being the risk averse thing to do because we can never say it's the best thing to do because you can't do that unless you know you're tal itking six mon,ths eight months, eight later . Right. He wants to know if there's any particular advice for somebody purchasing a new house in terms of looking for an energy fix or not or whatever. Well, I mean, if you're going to be purchasing a new house and you were to get a fix now, they are portable in most cases. I think the only ones you aren't off the top of my head are outfox Ovo and Scottish power . Most of the rest have fixes that are portable, but I'd always check. So you can fix now and you can take that with you to your new house. The thing to be careful of is, for example, if you got a dual fuel fix now for gas and electricity and you were moving to a property that only had electricity, then it may not be portable. But yeah, the same rule applies. If we're talking the really simple decision should I stay on the price cap which is absolutely undoubtedly going up thirteen percent in July and will probably element of crystal ball still be higher than it is now in October and comparing that to fixing now but making sure you get a fixed govara comparison site that's whole of market. If it's not whole of market, make sure you tick the box that says show all tariffs. But comparing it to a fix that is cheaper than the current price cap , then it is very substantially likely unless there an ext'sraordinary change that over the next year you would pay less on that fix than you would staying on the price gap . And not only that, but you also get certainty of knowing what you're going to be able to pay and budgeting certainty too. So if it's priced but it's a if choice between EV tariffs or type of use tariffs like the agile and tracker tariffs that octopus offer, then it's a much more complicated decision. Okay, haggling is a big topic this week, specifically hagg ling with call centers . What are you getting at here ? Okay, so basically what this is all about is many mature markets out there are whether it's insurance or mobile phones where effectively we've all got the product . So the real fight is they want to keep your customer and win business from other companies , haggling . And by that we mean simply saying when you get to the end of your contract or you're out of contracts and they will often try and put your price up saying that is too expensive, I want to pay less is incredibly lucrative. Now, of course, you could always switch elsewhere, but many people if they're happy with the service and they don't want the churn , they just simply accept their renewal. And this is primarily a lesson in don't just accept your renewal, especially in the right industries you can, often save a shed load. That's what we're talking about. So it's cool center haggling primarily we're going on about here. Okay, we've had some successes sent from people who followed your advice I called sky every year and play the game. We say we want to cancel, we get transferred to the typical overfriendly sales saver that they're there to stop me. We do a round of what if we did this discount for you . I say no, we go again until we come to the final boss . Let me put you on hold while I speak to my manager to see if there's anything we can do. They hold me for a few minutes while they doodle and build suspense and then come back with a new price . It's always fifty percent off the current monthly with some sort of freebie like movies for three months, et cetera. I mean it's it's just so fatuous the process but this you know, Andy is right. That's how it works. It is how it works and ultimately this is all based on price differentiation, which is an economic term that says one of the ways you have profitability is you charge each customer the maximum they are willing to pay. So those customers who automatically accept and those customers who renew are clearly willing to pay or they're not willing to pay but are unaware that they can pay or accept and do pay more than those customers who make companies fight for their business. That is simply the way that it works. And therefore, you have to decide you have three choices. Either you can't cope with haggling, in which case ditch and switch and move elsewhere and you will get a cheaper price. You can cope with haggling in which case as we're going to do tips on it coming in a moment, you'll be able to save the price or you just do your renewal and you pay more . Now I'm not justifying the way that the system works, but that is, I'm describing the way that the system works and talking about the consumer techniques that we can get there. Now, one of the biggest tips and one of the most important tips was contained in that success. And that is the fact that what companies tend to refer to externally as customer disconnections , the disconnection department are internally referred to as customer retentions . So if you say you're going to leave and we'll talk about it in a bit more detail I know we've got the news to come. If you say you're going to leave , then a company will often put you through to disconnections where they have the people with the real power and authority to give you the discounts and deals which will keep you. So one of the absolute cores here is if you're not getting the deal and discount that you want and that you need get yourself through to customer disconnections internally known as customer retentions . So if you what happens I'd love to know if I'm sure but I can tell by the way Andy's written his question he must have tried this. What if you ring up and say, look, I'm not going through the palava. Can we just get cracking? I'm going to disconnect, just give me your best off at and if it's not good enough, then I'll disconnect it anyway. I mean, is there a way of not going through this charade ? I mean no, I mean leave and go elsewhere . It's as simple as that because I ultimately Adrian what you've just said, I mean just imagine that you're in the call centre and you've got that alcohol. Well, they're going to say this is the best price that we can give you. And you don't know. Haggling is a negotiation . You know, it works like that. Now look, you might be lucky sometimes and you'll get the discount that you want straight away and you might be unlucky sometim es and you won't get a discount at all. This is art not science. But unfortunately, the frustration that's going in your voice indicates that you are effectively, you can't really be bothered with this all this ad shir and therefore the price isn't that important to you. No, no, it is no don't say that. It is important. I just Well, that's better. , but you know, the other thing is you have to start this with a different attitude. The most important way to do this , this is about Hutzpur and charm and winning the person you're talking to to your side. Going in with frustration and aggression is just not a good haggle sorry. It wasn't exactly a haggle, but I ran over my mobile phone . Don't ask me how while I was abroad. And I've put it in a car or with your feet. In a car? Okay, in a car, quite a large four by four. Okay . And I thoroughly recommend the case it was in because it's hard to survive but it's just about but the screen was right anyway. I paid for insurance so that I'm going to claim it. I went in with my studs. I'm so fed up with insurance and I rank the poor blood. I said Look, before he said anything, I said, I paid for this insurance , I was told it was no quibble. I wanted to pay and he was going, alright, alright, alright, alright, all right. And they did pay up and I felt a bit bad afterwards. But even he was saying to me, which I thought extraordinary for a call, and he said, You know you can do this online. So that somebody works in a call center trying to talk themselves out of a job just trying to I mean, they all have targets and the number of people that they can hit and they have to push people online in order to do it to get it going through. So I'm less surprised by that. And it's worth me saying when we're talking about haggling here, we could be talking on the phone. You could equally be talking these days with a web chat system and going through a web chat system to do it and talking to somebody there. It doesn't necessarily have to be on the phone . Do I believe you have a top ten of firms to hangle with? Do we have a little music bed? We do call it for this. We have a music bed. We're going to play it in just a second yes terday. This is the top ten UK service companies to hangle with from a poll that I've done based on the back of it. Now the success rates are for people who tried to haggle, not overall, it's only those who actually went for it. And what we're going to talk about. Olivia, hit the track . In at number ten it's LV with sixty nine percent success rate. Closely above that at number nine it's sky television, not its only entry in the top ten. Also with a sixty nine percent success rate . It is just behind its own stable mate sky mobile phones at seventy two percent. Sticking in the telecoms arena at number seven, it's talk with a seventy three percent success rate and then we start to move into the big ones where more than four in five people who tried succeeded. You've got AA insurance. I'll be mentioning that name again later at eighty percent. Hastings direct insurance at eighty two percent. Admiral insurance at eighty three percent. We get to the big three now in at number three getting right up there . A huge success rate of eighty five percent is virgin media and the top two come from the same sector. Those who haggle often will know exactly where this is going to be. In at number two , ninety percent success rate. Nine in ten people who try to succeed is the AA only being picked by its biggest rival , RAC for breakdown cover at a staggering nineteen one percent success rate of customers who tried to haggle succeeded. sixty two percent say they had a big success, twenty nine percent say they have a small success, add them together and you get ninety one percent. Right. One of the top two I haggled with, but I was so livid with them . I was so livid with them for offering me a much lower price than I'd found myself stock on. I just left them and swore never go back and wrote them a rule. I mean let me go through my haggling tips because that makes perfect sense. I get your frustration in this. Some people enjoy it, some people don't. But Adrian, the fact is, I mean, it is a golden rule. When you are coming to the renewal of your breakdown cover, do not do not simply accept the price you're getting. We had someone on the question time version of the podcast the other week who save five hundred and fifty pounds a year by haggling. I couldn't untick the auto renewal box that I'd stupidly ticked several years before. They wouldn't let me untick it without ringing them and then I couldn't get through . Yeah, I mean that's very frustrating but look, my number one tip is always before you do this benchmark the best buyers that are available elsewhere and be asking them to match that so that if you were willing to go elsewhere you could but equally I was going to my last tip is always if you don't get what you want then feel free to ditch and switch. Remember we do not have a right to a cheaper price I'm afraid, but they do not have a right to our custom . And as long as we don't make this aggressive with the individuals that we're talking to, they are free to charge you the price that they're charging. You are free to go and take your business somewhere else. And that's ultimately the trade off that goes here. I'd just run through my quick tip quickly because we've got lots of people who've got in touch with their own tips and I've also got tips from people who walk in call centres too . Number one tip, just say again, always be polite and charming, never rude. Some operatives have discount quotas , so you want to try to win them over so they support you and they give you one of their discount quotas. You've just got to go in with the attitude of financial flirting if you like. Can I ask you something about that? A bit nice. If somebody says oh hi, it's Aloysius here. Good morning to you. Do you say Oh hi Aloysius how are you? Do you use if they're giving you the name, do you use the name? If it feels right, if that's your normal conversational mode, if that's how you do it, I mean one of the most important things is we can tell let's do an me and you do this exercise now Adrian. Okay . Okay , so I'm talking now. I'm going to not do it just yet. I want you to tell me when I start smiling, okay? So the next tip I have is know when to haggle, focus on mature industries and now exactly. You heard it , right? You heard the smile in my voice. I'm livid though. I can't swell. I can't smell well, look, you know, you're an actor. You just got to get round, you got to do this. We can't be livid with them. It's not going to work. that was a real tip. Know when to haggle, focus on mature industries when the contacts end. Know your haggle reason before you call. So what is the reason you're going to say you want a discount ? This is over budget. I've found it cheaper elsewhere and you should have benchmarked those prices. I've spoken to my wife, my partner, my budgie, whatever it is, and they say , we can't afford this at this rate. So I'm going to have to get rid of it. I don't want to get rid of it. I'd prefer to keep it, but I can't keep it at that price. Have in your head what the reason you want a cheaper price is . We've already talked about no joy going to disconnections just going to read your success here because if we're talking mobile phones specifically , while you may be better haggling, there is a shortcut that you may enjoy. The final point when you found a new deal elsewhere that you do on your mobile phone bill is you ask for your pack code, your PAC code , right? And you can do that by you just text PAC. I just have to double check my head at six hundred fifty seven. I hope I've got that right, I'm doing that from memory. Have you got Rosie with your shield? We'll check that she knows. Rosie, Rosie will message producer Matt and Matt will then say in my ear whether that's right or not. PAC to six five seven. That's the magic behind the scenes, Adrian.ne That's how it works . So when you do that, in quite a lot of occasions, the company that you're leaving because you're telling it you're leaving will try and keep you and you'll get a text back saying, okay, here's your pack, c butode this is what we'll do if you stay. Let me read this from Sue. After reading your email so she sent this to me, I was finally prompted to switch my SIM from O two to GIFGAF. I'd previously tried haggling down my monthly tariff with OT without success. I read the advice about getting a PAC number and then waited a while after getting it. As predicted, O two called and offered me a deal, reducing my monthly tariff from over twelve pounds to six pounds and upping my data allowance from five gig to twenty five gig. Encouraged by this, my partner did the same and reduced his SIM only monthly tariff from eighteen pounds to eight pounds. Between those we've saved two hundred pounds a year and increased our monthly data allowances considerably . See, that's it and she goes on to thanks. Got it. Simply putting PAC in, telling them you're going to leave. It's all about letting them know you're going. A couple of final tips from me before we get onto the tips from out there , do not be forced to cancel This is what scares people off. I go through to disconnections like you say, but what happens if they say I'm going to disconnect you? Here's the answer They get on the phone here you could be the call center. So I'd like to cancel, we've gone through the talk and you tell me now you're going to cancel me Adrian. Well, in that case, I'm afraid you know, I know you're Martin Lewis and I know you're smiling as you talk, even though you're not particularly happy and I'm going to cancel you. Don't want you . Okay, yeah, I just need to go and check that with my wife before I do that she's happy with me to cancel and I will call you back on it. It could be your wife could your husband could be your boyfriend could be your girlfriend could be your father, could be your daughter could be your auntie, your uncle or even your pet parent. I don't care. But if your concern is, what happens if they call my bluff, then you just have the I just need to check with someone else and that saves your embarrassment and it gets you off the phone. Because next tip if you fail, try again in a few days. Different person, different time can get you a different result. And I've just had a message in I'm sorry , five seven five is the right number text P AC . And just because you're getting your PAC code by the way, doesn't mean you're leaving, it's only when that goes to the new provider that that's right. And the final tip of mine , if all of this doesn't work , if they haven't given you a deal or the discount that you want and you think is appropriate. If there are cheaper prices elsewhere, ditch and switch. We've got tips from people to haggle with a call centre, from people who work in call centers. In some cases, you've got the tips. We did a tellers on this. My tellers was call center secrets. If you work or worked in a call center, what tips do you have for people to get the best deal? And then I did another one which, is for people who are good at haggling to get in touch with their haggling tips. So you've got the haggling tips, I've got the call center tips from the call center staff, and we can alternate them. We'll play different roles in this. I'll be call center staff, you be a haggler, even though you're clearly not. Okay, haggling tip Saint Peter. Pressing, hash when going through the automated menu usually pushes you through to a human, yep . Kirsty from the call centre says be nice. If you're rude, I'll do what I'm paid to do. If you're nice, I'll do everything I can to help you. Interesting, interesting because I realize to the extent to which you assume they're almost automatons and they're only going by a pre read script. You forget they've got and you should remember this at all time , you know, they are, you know, they've they've got hearts and minds and it's probably not what they grew up wanting to do. And the people well not necessarily .' Its not a bad job and it's moving through a process, you know, it gets you there. But the point I would make is literally I've had call center staff tell me in the past they have a certain number of discounts they can give in a day . That's the point. So there is a discretion there of who they're going to give a discount to and who they won't. What's your next tip? The only effective way to haggle is to say you're cancelling because car insurance particularly is an annual time wasting ritual when they hike the renewal for no reason at all. You 're to called cancel and they immediately fold and combat with a better offer. Who's that one from? That's from System . Now I have to tell you , this one from Ellie has sent chills through me and I think it will send chills through everyone who hears it. Ellie and from a call center staff . If you think you're on hold , don't assume because there's music that the call handler can't hear what you're saying. Whilst you're on hold. That's not cricket, is it? Well, I think it's probably just done for the system. So I mean in purely haggling terms, what you don't say is you turn to your partner and say, Oh, they're offering me fifty. If they get down to forty, I'll accept it because that would clearly you've then given it away. But equally, what else could you be saying? I mean , I'm a little bit blown away by that one. What else could you say? What else could you say No, I don't mean about that haggling. You could be having a private conversation, you could be talking, you could be brushing your teeth, you could be doing anything else at the time , the fact that they can hear you when you're on hold. Yeah, absolutely. Cricket knot says Yep, open extreme. Make your biggest move, the first hold position , increasingly smaller counter offers and holds . Additionally, look at the tradables. There's always value to be had. I think I know what he's talking about there. Yeah, tradables is, I mean, anything they can throw in as extras will give you more, you know, we'll give we heard earlier we',ll give you more data on your mobile phone, we'll give you more channels that is non cash . Try for that as well because that's often easier for them than giving you cash. Claire like this one . Claire from the call center. Most call centers work n ine to five, twelve to six, two to ten and overnight shifts. Try and call towards the end of those times. Be polite, use the handler's name. Well, they go Adrian, you asked before, Claire who works in the call centre, says use the handler's name and tell them to take their time so they don't have to take another call two minutes before their shift ends. That makes them finish late. Interesting. Interesting. What were the times again for the shift? Nine to five, twelve to six , two to ten . Okay. And overnight shifts. Right. Got it. And generally, if you want to get through earlier in the morning is often best as a general rule, you know, not just haggling or all over the place . The Volts Volts LQ, I think it is. Yeah . The Haggle that works best is the is the one you time. Sky broadband insurance, all price on inertia. So the discount goes to people who know their contract end dates, diarrise renewals two weeks out and the call centre script right itself . Absolutely right . And if I just go through the top five sectors to haggle with, I won't do this with the music bed. Bank and card providers overall forty six percent success rate, mobile phone providers sixty three percent, TV broadband and home phone sixty nine percent, insurance seventy percent, and breakdown cover eighty seven percent , which I think is worth knowing. Back to the tips that I've got. I mean some of these are fascinating. Tina again on timing don't ring around lunchtime when people are on breaks. You'll have longer wake times and more stress staff. Okay, go on, give us another one. I like yours. I like this one too. Kylie , when we ask if there's anything else we can help with, please don't ask for the lottery numbers because we've heard it millions of times already. Brilliant. Brilliant. Kim says know the NATO phonetic alphabet because when you have a letter like a B or a P in your name or postcode, they sound the similar over the phone, also M and N and then swear words tend to come in the front of people's mind when they're under pressure to come out with something. I do people's names generally because I don't know the NATO phonetic alphabet. I don't swear, but you can just imagine someone doing it saying that. It's a be like beers in well you can come up with your own bee swear word . I do know mine. My dad taught it to me when I was little and it's just stock it just stuck with me. I got what's F. VoxTrot . You uniform. You're very good. I don't know them. Alexander, sending in legalistic complaints from chat GPT aren't the slam dunk you think. Nine times out of ten, they make no sense. Yeah, always read through your AI before you're going through. If you got any more tips there before we get to my tip to you, which is not to do mastermind. Yeah. Chris, it's funny how people like to haggle gardening services, but not electricians or plumb ers. Interesting . Yeah, I think face to face people find it much more difficult. And when you're dealing with someone who's doing the work themselves as opposed to offering a service, there's almost, I think we've got this British disease that we feel like we're insulting them by saying that price isn't the right price for me because you're having to say oh your work isn't that good. But you know everything that is discretionary whether there's a fixed amount of work is open to some form of negotiation but you have to do it the right way. And remember they can choose not to do it at that price and you can choose not to employ them at that price Adrian, you've got nineteen right and forty wrong in this three option multiple choice quiz which means sadly you are still B or C No better than random chance. For those who don't listen regularly, this is the money mastermind there's a setup and then a question for Adrian will see how he does it. You ready mate? I'm ready. Okay, now recently, our Ardrian was out in his padded gillet, off to a petrol forecourt shop to buy a token for his favorite weekend ritual , checking the tire pressure on his beloved two thousand seven Mud Brown Fiat five hundred . It's funny as you should say that. My mates at school always used to say I'd end up with a brown maxi. Fiat five hundred is quite close. Close yeah. Suddenly the lights flicker and a smoking Delorean screeches in, scattering air fresheners, dog chews and discounted DICER, a wild haired man leaps out and shouts Jump in Jehosaphat. Adrian, I need your help . Adrian, thrilled, climbs onto a stack of scre enwash and declares Rodes , where we're going we don't need roads . The man says of course we need roads I just know you do that podcast with Martin and I've got a tax question sorry my throat. From twenty twenty six, anyway, I've just retired he says, My pension is around twelve thousand five hundred pounds a year and my savings earn around four thousand four hundred pounds interest . Back then I didn,'t think to the future enough . Do I pay income tax? So Adrian , are you Marty McFly or Marty Muck? Why me? I want to know what's your answer. Reminder again with a twelve thousand five hundred pound pension and four thousand four hundred pounds of savings interest , roughly how much tax is payable . A non and it's all in the UK of course, B twenty percent of three thousand four hundred pound s, which is about six hundred and eighty quid, or C twenty percent of four thousand four hundred pounds, so eight hundred and eighty quid . What was big ger? twenty percent of three thousand four hundred pounds. So you've got a twelve thousand five hundred pound pension and four thousand four hundred pounds savings interest . How much tax would you pay? Non, twenty percent of three thousand four hundred or twenty percent of four thousand four hundred It's got to be the middle one because there must be some allowance the first. So Camel, what do you know about savings allowances? We've been doing this program . I know. I can't tell you just look up , how much can a person earn generally the personal tax allowance before they pay tax on it? Do you know roughly? Well, I think it's about twelve thousand five hundred, isn't it? It is indeed it's twelve thousand five hundred and seventy. Right, okay so this is a question about savings allowance. Yeah, so it's a question yes about savings allowance. So I take seventy of twitter seventy . Ignore the seventy. Yeah it's all rounding. So are you paying twenty percent of the entire savings interest ? Are you paying twenty percent of the entire savings interest bar a thousand pounds or are you not paying any tax on the savings interest? That's the question. I think you've got to pay some tax and I don't know why there'd be a thousand be not the whole lot, but I'll go for not the whole lot. So are you locking in B? I'm locking in on B. Okay, you're locked in. Right . Adrian says it's twenty percent of three thousand four hundred . Now, there is the personal savings allowance, which I suspect many listeners will know about, which says a basic rate taxpayer can earn twenty can earn a thousand pounds of interest a year on any form of savings without being taxed. So with the normal personal allowance and the personal savings allowance, that would mean you would only pay twenty percent of tax on three thousand four hundred pounds , not four hundred not four thousand four hundred pounds. So if that were it, you would be right, Adrian, but you're not Why? Why'd you do this? Why? Well, because I was hoping that I'd give you at least you didn't even get half the answer I was expecting you to get, which was to say that the personal savings allowance is a thousand pounds . What's missing in this one is there is another allowance that people don't know about. It is called the starting savings allowance. And what happens with the starting rate of savings is if you have high savings interest and low earnings, then it is a special allowance that means up to the first five thousand pounds of your savings interest can be tax free plus you get the personal savings allowance on top. And the way they set this scenario up, which was a twelve and a half thousand pound pension and of course pensions are tax able income. So that's all taxable income and four thousand four hundred pounds savings interest. Again, taxable income. It would all be covered by the starting savings allowance, which means the correct answer I'm delighted to say is A, in that circumstance , you would not pay any tax. You got it wrong, Adrian, but I'll be explaining the starting rate of savings a little bit more in the podcast for anyone in that circumstance. And they will get it right because it means they'll pay less tax. Thank you very much, Martin. Okay, I've moved into podcast only mode and I just want to explain how the starting rate of savings works in a little bit more detail. Effectively the rule is above the personal allowance, so twelve thousand five hundred and seventy pounds , you can earn five thousand pounds of interest only from savings and it would be outside an ICEA because interest inside an icer isn't taxable , and that will be tax free . However , for each pound you have from earned income which includes pensions above twelve thousand five hundred seventy pounds, you lose a pound of that five thousand pounds starting savings allowance of tax free savings interest . Let's do a few examples which I think should clear this up. So if you earned twelve thousand five hundred and seventy one pound s one pound above twelve thousand five hundred and seventy , your starting rate of savings allowance would drop to four thousand nine hundred and ninety nine pounds. If you earned thirteen thousand five hundred and seventy pounds, a grand above the personal allowance, your starting rate of savings allowance would be four thousand pounds. If you earn sixteen thousand five hundred and seventy pounds, which is four thousand pounds above the personal allowance , your start from earned income, your starting rate of savings would be just a thousand pounds . And once you get to earnings of seventeen thousand five hundred and seventy pounds, you no longer have the starting rate of savings. But remember you do still have the personal allowance because now you're a basic rate taxpayer and that means you can earn a thousand pounds of savings tax free each year. I know it's a little bit complicated, but what it effectively means is someone who earned twelve thousand five hundred and seventy pounds from earned income and had six thousand pounds of interest from savings outside of ISIS could have all eighteen thousand five hundred seventy pounds tax free. Obviously, you'll need to do some thinking how it applies to you, but it effectively this was set up to help people who have a low earned income and high savings interest , primarily pensioners who tend to be in that situation who've got savings built up over the years but are no longer working and they're just living off pensions that are at a relatively low level. And it works there, which is why Adrian got the question wrong. I was expecting, I don't know what you think. I was expecting him to know about the personal savings allowance because we've talked about that a lot. That's one thousand pounds of interest you can earn tax free as a basic rate taxpayer. five hundred pounds of interest you can earn as a higher forty percent rate taxpayer. You don't get a personal savings allowance if you're a top forty five percent rate taxpayer , but it didn't, which means the score gets even worse, nineteen right and forty one wrong . Now I'm joined by podcast producer Matt, hello, Matt. Hello. It's nice to have you on here. I think we're mostly covered haggling. I think we've got a lot of the different messages we got in. We have had some successes in. I know you've got those and I've got a few more of the tellers from call center staff that I'd like to read out. So why don't we alternate? Are you happy with that? I'm happy with that. Okay, you can start. You success first. Okay, success from Andrew. I bought two paintings the other day when I said I was interested in the second. I did ask for a possible discount and I got four hundred quid off. I said that's reasonable . I'll buy both . Wow, there you go. So work for both then. Hopefully work for the shop and work for you. Not a cool center haggle, but we like that one anyway. Sarah, reiterating something we've heard, but I think it's a different way of phrasing it , this is coming from call centre staff. Please, please, please just be polite. We're not chief executives of companies and have to adhere to guidelines set out that often can't be changed. If you demand to speak to a manager, they will often not want to talk. We simply pass on to another colleague, or they would tell you the same as we've already said. Yes, you might be angry and frustrated, but out of hundreds of calls each day, we'd only have maybe one or two that were pleasant to talk to, or that's awful . If I ever call nowadays, I make their lives as easy as possible. Never ever call thirty minutes before closing. So yeah, I mean, you can hear the frustration coming from the staff. You can also hear why it pays to be nice because if you're one of those two people they really will want to help you. It's interesting I had an issue myself with a call center. I won't go into detail it was, but I felt that procedurally and systemically something that that company doing was wrong . And when I asked about it and was told that that was the policy, I said I said to the call centre staff I said, look, this isn't new, but I think there is a systemic policy here. I'd like to make a complaint. How do I make a complaint? And he told me how and we did the complaint together and all the way through, I was very keen to say, I absolutely get you haven't done this. You seem a very nice person, but I do think that procedurally the company is behaving in a way that isn't appropriate. And I put the formal complaint in and we had a nice little chat about something and then we said bye. try not to make it personal because it wasn't individual's fault. I mean, why should I be having a go at him? When you ring up , do they know it's you? So when I call , I have an email address that is not my work email address so doesn't include money saving expert in my email, which is what I use for all of my dealings , you know, my private personal administrative dealings . And so there isn't an automatic clue in there . Some do go , you know, when they ask for your name and I say Martin Lewis, I've had people make a joke Oh you're the Martin Lewis or you should be careful. And I sort of don't never quite know how to reply to that. I've had others who do it as an assertion and then I will let me know if they ask me the question, I have to say yes and some who don't know. So it can depend. I will always remember there was I was calling up and it's a long time ago now because I think it was motorbike insurance and I've since had a ban on driving a motorbike from not from the police from my wife who won't allow it but anyway, that's another discussion So it was for motorbike insurance and I called this company and they hadn't done anything wrong and she got it with me straight away and just went into this absolute panic mode . And I said, I asked the question she said, Oh , I'm going to need to go and find out I'm sorry it's going to take two minutes and I was like that's absolutely fine. She just no I'm like, it's fine and sleep and I literally could hear her running across the call center. I could hear the feet patting at speed to get across the call centre and her talking in the background to someone in panic and I came back and just I felt really bad because I was being nice. I wasn't calling up to compl ain. I was just asking a simple inquiry question, but it felt I feel she felt like her entire job was on the line. And I do remember one time I go the opposite way where they didn't know it was me and I had incredibly rude service from somebody. I mean, they were really rude and I wasn't being rude. And I remember putting and what they told me was completely inappropriate. And I said to them , I don't believe that answer is correct and I believe that breaches the FDA's regulation on it. I would like you to check. And he said, I know what I'm talking about . And I said, well, I don't believe you do, and I'd like you to escalate if you would . And he was properly rude to me. And I said, I think we should take a step back here and start this again because I don't think this is good for you or good for me . Still refused . And in the end, then when I asked to speak to Escalate it to a manager as it was part of, he refused and he said you don't have a right and I'm not going to talk to you anymore and he put the phone down on me. Wow . And I called in the end I went senior and I used the who I am and I called senior people in that very large corporate environment . Explained to them what had happened and they said yes and explained to them why I thought their policy was wrong which they understood and agreed with. I'm not going to go into the details of what it was. And they said can we listen to the call? And I said, I don't want to because I don't want that person to lose their job . And they said, Well, we're going to listen to the call. So they listened to the call and they came back and I said, I had a big push. I don't want them to lose their job. I think they probably need some retraining, but I don't want them to lose their job. And they told me they wouldn't lose their job. But they said the irony was they had done a training session with call center staff and one of the analogies they'd used was just imagine that you're talking to Martin Lewis and this person had been and hadn't got it. So So but I don't want I'm trying to, as you can probably hear Matt I'm trying to be really nice about it and do it in just for people listening, I was nice and I was one hundred percent right and the company apologized later and agreed that I was one hundred percent right and this was it was just wrong, but obviously the guy was obviously having a really bad day. Yeah, we've all had bad. We've all had it. It does show, doesn't it? It pays to be nice. It pays to be nice. And I always do it the other way round. I imagine I'm talking to someone who's been embedded by the call centered by the daily mail and they were looking to catch me out so that I have to be nice the other way around in the same way . Right . So now I believe we've still got a few more left on this issue. I think you've got a couple of successes and I've got a couple more messages from people in the call centre. Shall we do those? If you'd like. PK Rising . I work at an insurance call centre. There is no wiggle room on price beyond changing your details, updating the quote. If they do get you a better price, listen carefully for and that includes your optional X . So I mean the message there I agree with, which is that always be careful to make sure you're getting a like for like replacement and the change in price isn't simply a change in the product . But we do have data that many insurance companies will, especially if you tell them what you're being charged elsewhere and they will often want an accurate quote. They want to know which company is willing to charge you less than they are. They will price match at least with existing companies. Have you got another success for me? Yeah, I've got a success for Matthew. He says I always haggle mainly with car insurance and car breakdown cover. Main one being the AA for car breakdown. Every year I get the renewal at way more than last year's premium. I call them and ask why it's gone up. I think I've only had three or four callouts in the nine years I've been with them. After this the price usually drops. This year the call handler said she can drop it from around two hundred thirty pounds to around one hundred seventy . I then said, Are you sure that 's the best you can do? And her answer was, Oh, I think we can do a bit better. Ah, yes, we can knock another twenty pounds off. When I mean, ultimately it's variable pricing, it's price differentiation as I talked about before. And we'll finish with Joe and because I think Joe sums up if I haven't knocked this message hard in yet I don't know what I can . If complaining which is slightly different to haggling, no matter how bad the complaint, just be nice to the person. I guarantee you will get better help from them if you make them want to help you. And that seems a good way to end. That's it for this week. We tend to put out a new episode every Thursday and Monday. That's our Question Time podcast, where you get to ask me absolutely anything and everything open brackets within breeze and closed brackets. If you've enjoyed the show today, please tell your friends you've been listening to the Martin Lewis podcast. Suggest they listen to. Why don't you and they subscribe? And why don't you and they leave us a review? Are we asking too much? Maybe. But go on, if you've got a little bit of time, you can always do it. Your pockets at least will be pleased with you and if you haven't enjoyed it and you've been listening this long it's your own fault so Martin Lewis is the founder of money saving expert. com, but of course other consumer and price comparison websites are available. You can get in touch with Martin's podcast production team by emailing Martin Lewis podcast at bbcot . The offers and rates mentioned in the podcast are correct at the time of recording. However, if you are listening on demand, it's worth double checking as details can date. Remember to subscribe on BBC Sounds and leave us a review however you listen.