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When is it worth it to “nickel and dime” someone? I’m not talking about saving a dollar here or there by using coupons or waiting for a sale, but the savings gained by negotiating a slightly lower price.
My case in point is two friends who are about to sign a yearlong lease for a loft in a good location in downtown Providence, RI. The apartment comes with two covered parking spots, a major perk in a snowy climate. All apartments come with at least one space because overnight parking is not allowed.
The landlord, a casual friend of my friends, agreed to leave the place vacant in June and July so my friends can move in August 1. The landlord is willing to lose two months rent to secure responsible tenants, I’m guessing.
He could find other tenants, however. Apartment vacancies are dropping in Providence because of rampant home foreclosures in a state that has the fourth highest unemployment rate nationwide. The vacancy rate was 7.6 percent in the third quarter of 2009, according to the Providence Journal. As a consequence, rents are rising. The landlord is asking $1,250, which is a bit high for the city they live in. Average rent for a two-bedroom apartment is $1,003, the ProJo reported.
My friends really like the loft but are considering asking to pay $1,200 a month, which would save them $600 over the year. The savings are significant to my friends. One of them is unemployed and the other is living off student loans while in law school. But they are worried asking for lower rent will damage their relationship with their landlord/friend, or at the very least make it awkward in social situations.
At what point does saving money end up costing more in bruised relationships? Is it possible to keep the business of negotiating rent out of the friendship? Bottom line – should my friends ask for lower rent?
Related posts:
Money morality – helping out low income friends
Money morality – do you accept money from parents?
Money morality – legit to shop at thrift stores?
Gwenypics/Flickr
I’ve been feeling generous towards a low-income friend lately. Not that he needs any help, but I am able to give it. I’m not interested in giving this friend a loan, but I’m considering subsidizing various activities with him, like picking up the lunch tab or treating him to a movie.
The prospect of giving gifts to a friend outside of Christmas, birthdays, and special occasions makes me nervous. Is this even appropriate? Will I hurt his pride? I called etiquette expert Nancy Mitchell for tips. Here’s what she advised.
What are the rules when it comes to giving gifts to friends?
I think the number one rule is to know the friend and know how to proceed. Would the person be wiling to accept things or is the person extremely proud and you’ll have to use subterfuge?
Let’s start with the person who may be very proud and not be willing to take what they think is charity. You can call them up and say, I got a gift certificate to a restaurant or theater. I would love to have you come with me, are you available? They might not have to know you went out and bought the gift certificate yourself.
Or say, Someone gave me two tickets to the hockey game. Would you like to go? If you had a friend who had children, give child care once and a while. I’d love to babysit sometime. Can I babysit and give you an evening out? Or say ‘I’ve got too much of a certain product. Pass things on, share some of the wealth. Offer to share frequent flyer miles.
Is it ethical to give gifts like this to friends who, if they knew the whole story, would say no?
I think it is because you don’t have an ulterior motive. You are giving from your heart and you are showing great sensitivity to someone’s situation. It’s not going to hurt anyone, it’s going to help.
What are the no-nos of giving?
You would never let anyone in on the secret. It’s between you and whoever is the recipient. Because if the cat got out of the bag there could be some hard feelings.
What about if your friend is open to receiving gifts? (more…)
Offbeat Photography/Flickr
A friend of mine lives in a part of the country where expenses are so high that nearly every couple works two high-paying jobs and still struggles financially. So how do they get buy?
The answer shocked me – they accept money from their parents.
“It’s not a matter of whether you do or do not accept money from your parents,” she said. “But how much.”
My friend was talking about more than simple birthday or Christmas gifts. For her and her friends, parental cash flow affects the household’s bottom line.
Some parents send a check every month. Others give generously at holidays, provide extensive child care, or pay for entire family vacations. Still other parents pay for school tutition or establish college funds for grand kids.
It can be difficult for grown adults to accept money from parents. Many people turn it down because of pride. Others are held up by particulars. Does there needs to be a written contract? How do you ask for more, or less? Most importantly, is it possible to have “no strings attached”?
A contract is not usually necessary, but depends on what everyone involved is comfortable with. Asking for more or less comes down to explaining the request and being able to accept the answer – and additional strings. Because after the agreement is made, what lingers is the strings.
Financial gifts nearly always come with strings attached. And the bigger the gift, the more strings there are.
For instance, my Mom used to send me $100-$300 every month in college. I had a family credit card for groceries, but everything else was on me – clothes, movies, subway tokens – and the paycheck from my part-time job didn’t go far. There were few strings attached to this money, partly because it was a relatively low dollar amount. (Though it did encourage me to call home every week.)
Years later when Hubby and I prepared to buy a condo, my Mom advanced me a large portion of my inheritance so that I could contribute to the downpayment. We wrote up a simple agreement about the terms and both kept a signed copy. The rules were very clear, which made it easier on both of us. The money came with one very strong string – it was not to be used for anything else.
Some years after the condo advance, my Mom offered another fiscal carrot. If I moved back to California (I remained in New York City after graduating) she would give me her car, worth about $10,000. The money came with a very clear string – a California address – and it was one I was happy to accept.
There is nothing wrong with taking money from parents as long as two conditions exisit. The support has got to benefit both sides (don’t take money from parents who can’t afford it). And both sides must agree to and accept the strings attached.
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I recently bought $29 worth of clothes at two thrift stores – Salvation Army and Goodwill – and each time I made my purchase I felt like I was taking advantage of a service that was meant for people earning much less than I earn. Not that I’m a Rockefeller, but I make a decent living.
On both shopping trips I saw people who fell into two camps:
- those shopping there out of necessity
- those wanting to get incredible prices
The presence of other bargain hunters didn’t make me feel any better about the shirts, dress, pants, and belt I paid $1.74-$4 each for. Shouldn’t these clothes be going to someone who really needs them? As opposed to me, who was looking for an all-yellow outfit for my Frisbee tournament this weekend (above, team colors).
In the past, readers have commented that if in my gut I feel I have done something wrong, I have. But I’m not so sure this time.
My uneasiness is less about committing a wrong than feeling like I was sucking up a limited resource. I can afford to pay more for clothes, therefore I should, leaving the Salvation Army and Goodwill selection to the poor.
Case in point, after purchasing a pair of black long johns ($4) and a pair of black sweat pants (also $4) from a man who compulsively snorted, I paid $10 to ice skate for 45 minutes, $2 for a bottle of water (forgot mine in my car), and $6 for a beer at a karaoke bar at a friend’s farewell party.
What do you think? Is it unethical to shop at thrift stores intended for poor people when you can afford to pay more?
UPDATE: Readers chimed in to say, for the most part, that my guilt was nonsense.
Living Doll said:
Release your guilt Bargain Babe. You are doing something good by shopping at thrift stores because you are helping support an organization that isn’t in it entirely for profitability. Most of these stores have loads of clothing that is reasonably priced for those less fortunate to purchase. You are not taking from them.
Laura admitted to twinges of guilt:
I love shopping at the thrift stores, and now my boys, away at college, do the same. I must admit though, I do feel a bit guilty, I take off my diamond ring before I go in, and I park my Volvo down the street! I do donate to them also.
Mimi questioned my aptitude:
You cannot be serious about this question. I think you are pulling our collective leg. Do you also feel guilty buying at garage sales, swap meets and flea markets? This has got to be a joke on readers who are ethically and morally challenged. I don’t believe you are so naive to ask the question with a straight face. But I could be wrong.
Actually Mimi, I was serious!
Audrey is succinct:
I agree with most of the posters. The program is not intended to provide clothing to the poor, but rather to generate funds for the outreach programs they provide.
A friend of mine recently took a weekend trip to visit a state she had never been to and stayed with friends for two nights. The accommodations were as good as a top name hotel, the homemade meals delicious, and the hosts gracious. So what’s her problem?
Her hosts paid for EVERYTHING. Breakfast at Starbucks, groceries for meals at home, gasoline for the 2.5-hour drive to see a national monument, and dinner at a restaurant on the way back. They wouldn’t let her pay for ANYTHING.
“How hard do you insist on paying?” she asked me.
“It depends on the circumstances,” I said. “How do you know these people, again?”
She described them as long time family friends.
“Are they the type of people who enjoy paying for everything?” I asked.
“Yes, but we wanted to pay for something, at least symbolically,” she said. “But they wouldn’t let us.”
Now she’s back from vacation and having been treated at every chance she’s not sure what to do.
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If you voted to send a gift, how much would you spend?
I was chomping on a tasty BBQ dinner with five friends when – GASP – the waitress undercharged us. The bill was $20 a head – a fab deal for the meaty meal – because she had failed to add another $11 for the booze. The four of us who split the drinks would have owed another $3.50 per, which includes tax and tip on the beer.
“Should we tell the waitress?” I asked.
Nobody said anything.
The person holding the bill shrugged.
Not being one to rock the boat, and being a little greedy, I kept my mouth shut. We paid the bill as is. The waitress went home a little poorer and we went home a little richer.
I still feel uneasy about what we did. I’m sure a few of my friends, if not everyone else at the table, had similar urges to do the right thing. But the group mentality to take advantage of a minor windfall won over the individual suggestion to fess up.
Should I have stood my ground? Or does being undercharged even out the times we don’t notice being overcharged?
What happens when you are undercharged?
Related:
Money morality – is finding money stealing?
I found a five dollar bill at the Hollywood farmer’s market Sunday – but I didn’t pick it up.
The crumpled bill was next to bags of green, yellow, and red peppers. Was the real owner nearby? Would anybody see me if I grabbed the money? Should I loudly proclaim my luck and be the envy of the stall?
“Look!” said a person next to me. A long finger pointed at the bill.
I was too late. Someone else had spotted the bill. I backed out of the booth and continued my grocery shopping. On my way back to the car about 15 minutes later I returned to the booth…just to check.
GASP. The bill was still there. Nobody had come by and noticed a free floating five dollar bill?! Even the stall owner was oblivious. I guess everyone was busy looking for celebrities.
The bill was mine!
How lucky did I feel? I felt guilty, actually. But there was no way to find the right owner so it might as well be mine, I reasoned. I could have given it to the farmer, though…
To pay my luck forward and get the stolen money off my hands, I purchased a bag of overpriced, I mean, locally grown organic almonds. Compared to Trader Joe’s I got half as many for almost twice as much! But oh man, do they taste good. And my financial conscience is clear.
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UPDATE: Reader Christina left a comment worth sharing!
I once found $120 on the sidewalk one night. My friends and I waited about 45 minutes to see if anyone would come and no one did. No one came, so it covered a lot of Christmas shopping that year.
I read an interesting essay in Newsweek that says psychology plays an important role in charity. The more direct a connection we have with the person in need, the more likely we are to help them.
But what I found most interesting was the essay’s final statistic: people who give are more likely to be happy. Reading this made me wonder if frugal people, i.e. you and I, are more likely to give than the spendy?
In other words, are we one big, cheap, happy family?
And yes, I will admit that while writing this post I took a moment to donate $250 to my favorite charity, Heifer International (which gives animals to poor people so they can sell eggs/milk/wool), so I could vote affirmatively. Peer pressure also increases donations!
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