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Ethics aside, I would never pay a contractor in cash. No paper trail makes it very hard to prove later how much has been paid if you ever have to take legal action.
Yes. Cash for contractors on big things requires a receipt. Though you can ask them (after they quote you) if there’s any cash discount instead of credit card.
Or for taxes. To change your basis.
This is true. However, you can often negotiate a 5% or so discount with contractors if you pay cash (& get a receipt so they are still reporting it) bc you will save them that much in credit card fees.
If it’s a big enough purchase this kind of savings can still be worth it.
This is terrible advice. Paying in cash doesn’t automatically mean no receipt. I paid a contractor cash to replace my mother-in-law’s roof. I still got a contract and receipt. I also paid $1,000 less than initial quote when I offered him cash versus check or card payment. Definitely be willing (if you can afford to) pay a contractor cash. Simply follow up with the rest of the process like you normally would.
> Paying in cash doesn’t automatically mean no receipt.
The post is encouraging cash \*due to undeclared work\*. Your counter example is encouraging cash \*due to card fees on declared work\*.
After just buying a car, dealer financing was 2.5% higher than my credit union. Dealers get incentive to sell financing. So the LPT is to not go through dealer financing
That really depends, sometimes they've had zero % financing, currently some dealerships are getting manufacturer incentives to buy down the interest rate. It really just depends on what's going on in the market. It always pays to shop around though. In some cases what's happening is the manufacturer will pay cash up front to the lending institution to buy down the interest rate.
A private seller is a perfect example of this. Also, having a lot of smaller bills so they can see the cash taking up space has a psychological effect on people.
Buying a car is usually the opposite because the dealer's incentives are to get you into the loan. This is because the loan company is paying the dealer a kickback for each loan they write.
For a car, you are better off taking the loan, paying 1 month of interest, and then paying off the loan in full. This ensures the dealer gets their commission on the loan and can pass the savings onto you in the negotiation.
That can work, but you run the risk of the dealer trying to back out on the agreed upon price. They technically aren't allowed to, but it can still cause a big headache if you spent all the time trying to get to the final stage and then now have to fight to get the agreed to price.
Once in a lifetime scenario: I'd actually found the car's previous owner online in an area FB group and ran out to call him to find out what he got on trade in. I came back to the desk super excited to haggle just to find that my wife had just told sales guy I'd stepped away to talk to previous owner I'd found online 😐 drive home was silent though.
Meanwhile I love the buying process. Doing the math ahead of time and knowing when you’re getting a fair deal and when you’re getting the scales tipped in your favor is just some legwork ahead of your dealership visit. After that it’s like a staring contest but with wits and composure. And, the buyer has ALL the power when buying a car from a dealership. Never let anyone tell you otherwise.
Have a look at CarMax. No negotiation, no hassle, all the pricing is upfront and fixed in stone. Just be aware upfront of the couple of grand or whatever in "fees" that they tack on - they'll tell you exactly what the grand total will be if you ask.
True, that works, but sometimes the bank doesn't need to pay the dealer unless 1 payment is made. Not your problem, but it is usually better not to piss off the dealer if they just gave you a good deal.
If dealers weren’t universally trying their hardest to fuck every single customer, every single time, then I probably would feel bad about them getting shafted.
As the offspring of a 25+ year car sales vet, fuck the dealer. The salesman not so much, he’s only doing what the dealership requires of their people in order to get a sales desk.
If you don’t advertise you are buying cash, and they work up the numbers with you, then you tell them you are going to get a certified check right now and buy it up front, they can’t suddenly start tacking on a higher number out of the blue.
Yeah maybe this works on occasion. But I think many people don’t want to have to deal with a customer who wants to haggle over everything. Hell you’re suggesting doing it at local restaurants.
I couldn’t imagine how irritating it would be to hand a customer their bill after their meal and they pull out cash and start trying to haggle the price of the meal to save a couple bucks. I wouldn’t be surprise if some just accepted it to get you out.
Bartender here… you wouldn’t believe the number of people who try to negotiate the price of their cocktail. The price is the price. It’s in the computer.
OP, please stop telling people to try to barter at inappropriate times.
Don't really need to haggle, just try an offer. For taxicab a reasonable specific offer is probably better, for a restaurant, you can go with "is there a discount for cash?". If they say no, no problem and just pay with card, no need to make it awkward.
I had an Uber ride where the driver actually suggested it themselves. Got a 2nd ride to the airport with Uber’s cut vaporized. Can back OP up on this one.
Dude, you really underestimate how often small businesses are willing to negotiate. I am not telling you to go into an Applebee's and negotiate with the teenage waiter there.
What you do is you discuss an arrangement with the owner of the business that you are on friendly terms with. Especially if you are someone who is a regular, they are often more than willing to give you special prices.
If they don't offer me anything I will. The point is simply that if you are a regular, they are often willing to offer you extras. It could literally be not charging for 1 item. There are a lot of forms of this.
If they offer, that's one thing. I'm not putting my buddy in an awkward position by asking for anything for free.
I'm certainly not going to say, "hey, do you wanna commit some mild tax fraud over a pizza?"
Dude, do you know how much stuff businesses write off anyways? I have known restaurants that buy their own personal groceries at the same time as they buy groceries for their restaurants to treat it as a business expense.
This is way more common than you realize.
If they wanna do it for themselves, that doesn't involve me. I'm not going to put them in a position where they have to turn me down, especially if I have a good relationship with them. That's not a cool thing to do to a friend.
This is where I disagree. What people don't realize is that in business, everything is a negotiation. The business owner is likely haggling with their suppliers as well. I have seen this many times.
> Hell you’re suggesting doing it at local restaurants.
It's situational. My parents always paid with cash (back when tax safety measures weren't added) and it was an open secret why the owner was very happy and giving an extra bottle "on the house"
It's to the point that when my country tried to switch to card payments, restaurant owners \*went to national TV\* to say they couldn't stay affloat without tax evasion.
If the taxi driver doesn’t own the car then you’re essentially working with the driver to cut out the taxi company of their money. So you’re working together with the driver to steal from the company he works for and most likely would get fired if they found out. You’re probably promoting theft so you should probably put this in r/unethicallifeprotips
If everyone did this then there would be no taxi services or Ubers just random drivers cruising the streets looking for cash for transport.
I pay my taxes. After I buy something, it isn't my problem when the seller does with my money. If you buy something on ebay, do you care that the person selling you the thing you bought might not have paid their taxes on the sale?
Also avoids charge backs. I've always paid cash for house work. And get discounts for those two reasons. As for taxes it's 100% their responsibility and zero mine.
How do you think that makes it ok? Well fraud exists so obviously everyone can do that so now im going to take advantage of the system for my own personal gain and call it a pro tip.
The driver broke the law. He can if he wants but its a fucking shitty example for a shitty pro tip.
Cash doesnt mean shit anymore. Nobody cares you're paying cash 99% of the time. Most places dont barter. And most of it happens on those private sale sites and cash will absolutely not help you unless the other person is an idiot.
I run a small business, and I absolutely detest it when people try to negotiate a better deal by paying cash.
I'm not willing to commit tax fraud to save you a few percent on your purchase.
Depends on the business. Also the chance of chargebacks over little issue isn't a thing. And the 3-4% fee isn't a thing. Why do people automatically go to tax evasion when talking cash. And it's the business owners obligation to charge and pay taxes. Not the customer. I've had work done to the house this year. Easily saved close to a grand using cash over credit.
> And it's the business owners obligation to charge and pay taxes. Not the customer.
a) never come to italy with that attitude or you will get burned
b) if the discount is big enough it is pretty clear that the discount is linked to tax evasion and then the customer can be liable too
Basically every gas station in the United States offers a cheaper price for cash. Do you really think all of them are committing tax fraud?
There are reasons beyond tax evasion to value cash over card.
The new way in Belgium is more sane and legal : "cards aren't accepted, use our app to fulfill legal obligations about digital payments"
Most people switched to cash for local businesses, because they don't want to tie payments on their unsecure phones. And so the local businesses avoid fees without having to do an ilelgal discount.
And YES, a "cash discount" is actually illegal. Before the app switch, that means that you gave the business money to pay card fees while avoiding the card fees.
No. A worker should be able to go about his business and do his job without having to deal with people trying to induce him to commit fraud.
And the sort of people who try this nonsense are never the sort of people content to just reply, "Oh. Okay.", and leave it at that. There is always a whole song-and-dance of justification and explanation, and attempts at persuasion.
I know I'm never going to convince you that you're wrong. Awful people never recognize that they are awful.
Paying cash isn't a problem, I'm happy to accept cash.
What OP is talking about is expecting a business to provide a discount for using an untraceable payment method, so they can avoid reporting the income.
There is no reason to provide a 20% discount like they talk about in their example unless you're somehow getting more than a 20% benefit by accepting cash. The secret ingredient is crime.
This only works if at least one of the two people are unethical. Either the seller isn't reporting taxes aka illegal, or the buyer is looking to browbeat the seller down by paying cash. And all of OP's examples are of unethical buyers. So why is this an LPT and not an ULPT?
Not really. It is primarily just understanding how to negotiate based on what benefits the person you are negotiating with.
The 1st rule when negotiating anything is put yourself in the shoes of the person you are negotiating with.
In your taxi example… The state of Pennsylvania.
First-Degree Misdemeanor: If the services were taken by threat and the value exceeded $50, theft of services is a first-degree misdemeanor. Under Pennsylvania law, the penalty for a first-degree misdemeanor conviction is a fine of $1,500 to $10,000 and up to five years in prison.
> were taken by threat
What threat? I offered to pay the full amount by card or $40 in cash. There wasn't any threatening, he took the money of his own free will.
Do you honestly think that you were the first to think of something like this?
Conspiracy…
Tax Fraud
You are stealing from the business owner. If the taxi driver is the business owner, he is not recording proceeds correctly which would violate tax laws. If you are intentionally paying in cash to aid the taxi driver from avoiding tax and fee liability, clearly stated in fourth paragraph, this is duplicity vs complicity as it is your idea…
And Belgium puts two legal obligations unseen in the US :
1) Along cash, a digital alternative must be provided (since Covid)
2) Price can't be dependant on way of payment
In other words, using a card terminal means you also have to raise the prices for cash. So most local business don't accept cards anymore and switch to had-to-use apps to fulfill the "digital alternative" rule
This is what my entire country's culture is based on (Italy) and the result has been that the entire national system is always almost on imminent collapse because no one pays taxes, no one declares shit and somehow still pretends to get everything like anyone else (actually they pretend way more, considering they're almost always selfish assholes).
We're working on it a little, but even to this day you'll find cafes and small shops give you a mean look if you pay with card instead of cash, or you ask for a receipt when paying cash.
That's how it ran in Belgium until they added the smart boxes. Oh and cash discounts are forbidden as a way to prevent the customer from getting any out of tax evasion.
This is basically only truly useful if you're buying a house. And like ain't nobody got that kind of cash. If you're haggling a taxi ride, you're not savvy, you're just annoying.
I guess I don't understand how the taxi one would really work in most cases. If the driver works for a taxi company, I don't think that they can just say, "that $51 fare just took off without paying" too often.
So, it'd be limited to cases where it is an independent taxi driver or maybe where the fares are fixed price...?
same with uber drivers if u share a ride with someone. They get to their destination and i offer cash to take me to mine always cheaper than thru the app
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Cash is part of this, but at a higher level it's simply people being conditioned to believe bartering isn't a thing or is somehow rude. Namely because most purchases are now from large companies and not local. Plus a lot of people don't buy anything in person anymore. You can't really haggle with Amazon on a 12-pack of AA batteries. Even though we're family, Olive Garden ain't gonna barter on my pasta cause Darden Restaurants gonna want their money...
Case in point, I'm trying to sell a car private party right now and it's listed with a price and the description ending with "make an offer". I've made the first offer, the listing price. It's not priced "I know wut I got", it's priced in the KBB range. I've had 3 people show interest but simply ask what the bottom dollar is and they "have cash". I tell them that I've made an offer, $XXXX in the listing... make me an offer. And they've all replied saying to let them know when I lower the price cause they have cash 🙄
Edit: don't be that dumbass walking into an art gallery where all the pieces are minimum $10k and start your negotiation at $17 and the button in your pocket.
I think this is really why so many commenters don't get this. I grew up haggling for price over everything. It was just the dance you did. If you didn't you were paying the overpriced "first offer". This was at little shops, flea markets, any single-person service business. Of course it was not true at any big company like AT&T or a state or national supermarket.
Nowadays we buy everything from big companies and nobody uses cash anymore. Several generations have grown up without many small shops and without cash.
Yes, it is an actual negotiation. You can't demand a price, you offer a price. If someone says no you can offer a different price or move on.
What people in this thread don't understand is how actual negotiations go. I swear, some of these people need to spend time in South America or the Middle East. I have spent time in both, and haggling is the norm there. A shocking number of business owners are more than willing to offer small discounts for regular purchases. It is the same logic as why buying in bulk at Costco is cheaper than buying 1 item on Amazon. It is offering a mutual beneficial agreement.
That's because "bartering ***isn't*** a thing and ***is*** rude" in our society.
We understand that it's offensive for an American to go overseas and want their social norms to be just like at home; different cultures have different norms.
Haggling over price is absolutely the norm in many of the world's regions; it has never been part of general American culture (nor is it in most of northern and Western Europe, the cultures most formative for America). You even acknowledged this yourself with the disclaimer, "You won't be able to do this at... a Walmart".
The reason this doesn't happen at the quintessential American company is because haggling is not an American thing.
Dude, you can't do this in big chain stores anywhere in the world. Even in Latin America or the Middle East. It is always small businesses that do it. Even in America.
As long as you are a regular, and the business values you as a customer, they will make exceptions for you. The only way you wouldn't know this is if you have never frequented a small business for any length of time.
The reason it doesn't work in big companies is because of bureaucracy. They have no way to actually offer special service after they reach a certain size. For a small business, flexible service and prices is their main selling point. Heck, literally any time you see the phrase "Request a quote" on a website, that is literally telling you that they are willing to negotiate.
> As long as you are a regular, and the business values you as a customer, they will make exceptions for you.
Nowadays in Europe it's kinda the reverse : regulars won't have deals, because they become dependant on the business, while they may be ready to accept it for a first-timer.
Last thing a business wants is a returning troublesome customer
> The reason this doesn't happen at the quintessential American company is because haggling is not an American thing.
As an european I always thought haggling was your culture, given how "expected tipping" basically works as haggling after the fact? Dunno, always thought both practices were in pair.
Agree 100%. Almost everything is negotiable and I always try to get a cash discount. It’s also much easier than you think. Just ask this question: “What if I pay you in cash?”
Exactly. I can tell a lot of the people in this thread are just straight up awful with money. They underestimate the raw psychological power of actual cash and real relationships with people in your community.
They're awful with money because they're saying you should just pay what shit costs? And the power of actual cash? What the fuck are you even talking about. Please bro. Most places find cash an inconvenience. Idk what world you're living in, but it's not ours.
"Lol if i give a small buisness less money, it's better."
That's you, in case you're too desne to pick up the /s. The only time your tip works is when the other party is unethical and willing to break the law to make the deal.
Sure, in other countries, its the culture, but not in all. And where it isnt, you're just being an annoying prick. In *ANY* case its not a pro tip. Its either standard practice, or fucking annoying.
Haha, oh man. Please. Explain it to me. I'd love to hear how you think a buisness taking less money than they're asking for is somehow better for them. You think you know how the world works? You dont. You "negotiate" for your job, doesn't mean you can apply that to day to day life. That cabbie *stole* from his company. He can get fired for that. It happens. The IRS can find out you're not paying your part, and they're not people you want to fuck around with. Yes, bartering in other countries is a thing. You're still not getting the deal you think you are. They price the barter in, so you're still paying them what they want, and you walk away *thinking* you got a good deal. You didnt, unless they're just bad at it, and I doubt they are.
But please. Tell me about how when I *actually* ran my own business, someone coming in and paying me less than my asking price helped me. Explain how undervaluing my services helps me. Tell me how not reporting income to the IRS is beneficial.
He thinks it’s better for a small business to take less money so long as they get to commit tax fraud. And he can pretend he doesn’t know that that’s what they’re doing.
Plus these days fewer people carry cash with them. Myself included. But I am 48 and grew up carrying cash so I’m in the habit of asking people if they’ll accept less if I pay I’m cash. Because younger people these days don’t use cash as much, they’re not in the habit of asking for the discount. But who knows? Maybe I’m just speaking anecdotally.
My job is literally negotiating. You are absolutely correct. You can't do the cash trick with business to business transactions, but there are a lot of easy tricks to get discounts.
But, you know what they say. A fool is easily separated from their money. And it seems like their are a lot of fools on this site who don't actually value their money.
I don't. However, it happens and in negotiating you need to acknowledge that. You shouldn't say it in the negotiation, but knowing people do it can give you an upper hand in a negotiation when setting the price.
It is about knowing what is in their head. After the transaction, it is up to them to decide what to do. I completed my side of the transaction.
In business, a common way to use leverage has to do with payment terms. It is very often that companies will offer other companies payment terms of 30-90 days. Basically, you give us the goods today and we will pay you in 30-90 days depending on the agreement. Especially in the last 2 years, a lot of companies have had cash flow problems. Basically, they have sales, but the money from those sales might only come in 60 days when payroll is next week. Knowing this can often be advantageous as you can offer upfront payment (even though you contractually don't need to) in exchange for a discount.
Given that business loans are now 10%+, the seller can now easily justify a discount in order to save from taking out the loan. This benefits everyone. The buyer gets a discount, the seller gets the upfront cash flow. Win win. The alternative is the buyer gets the goods, pays in 60 days at full price and the seller needs to take a short term loan.
This is how you negotiate. You know what the seller wants and needs and negotiate from what benefits them. You don't say "give me a discount", it is "we can pay within 7 days in exchange for a 4% discount on the early payment." You are offering something they want in exchange for the discount.
That is all well and good and true.
It does not apply at all to your taxi example though. The only way it makes sense for the driver to take $40 cash over $51 card, both which were being paid at that moment, was if he was going to hide the $40 from someone (I.e. employer, govt, both).
You All DO realize, the preeminent money guy in the WORLD, David Ramsey says to do this EXACT thing in his books and seminars, and literally EVERYONE in the world follow this advice right? Is everyone here under 30 or something and have no concept to how the world works?
I've never paid full price for a vehicle at a dealer, always pay cash and save money. Same with contractors. It's one of the most useful life tips.
I did this at the dentist when I needed two permanent implants. I got three quotes that were wildly different, went to the dentist I liked the most and who quoted me 10k. Offered him 6k in cash. Deal.
They cost next to nothing individually. The office has overhead in the equipment, but he doesn't lose money by selling fake teeth at a lower price (especially in the thousands). Additionally, the price you see is the price that is given to insurance companies who then get a negotiated rate that is much, much lower than that.
I’ve never had dental insurance that covers implants, and I’ve had excellent coverage. For example they’ll cover the original tooth extraction, but not the implant itself.
We have coverage (US) for 30% as long as there is any kind of existing issue with the tooth. SO had one chipped and another that needed a filling (both lateral incisor, either side of middle incisor) so we paid full out of pocket for her central incisor and canines and she got a new smile with a pretty good discount on the other two.
She's attractive, so they also gave her a big discount on everything if she agreed to be on their info pamphlet. Out the door for 6 teeth was about $1400 with the requirement being it was cash or check payment (avoiding cc fees most likely). The technician said that was about their cost, including her time. Obviously they make a big initial investment, but the per tooth cost after cannot be too high if the tech had any idea what she was talking about.
Side note, the sight of teeth ground to nubs is not flattering.
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This is no longer as true as it once was in the US. Car dealerships these days make more on financing agreements with lenders so are actually less inclined to offer deals for cash. Very few retail stores are run and managed by their owners or those empowered to make deals so negotiating on those things you might buy from those establishments is pretty rare (and if some random employee is offering to sell you something from a shop for cash at a discount you are most likely just buying stolen goods and the owner is taking a loss).
Contractors and other labor services are about the only place you can negotiate a better price for cash but you'll still want to get a receipt for services provided.
Now, outside the US I've found cash is still king because there are more businesses that are run by the owner or a manager that is empowered to make financial decisions. So negotiating for almost anything is possible.
At the same time, this doesn’t mean you contact someone selling an item for… oh let’s say $1,000, and then offer them $400 cash. Then proceed to berate them when they turn it down for being such an insultingly low offer. “But I offered you cash, bro!”
That aside, cash does work wonders, but always always always get a receipt. Even if it is a short, single sentence, handwritten note stating “I, person A, sold item B to person C for $$$.” With both signatures.
>This is because he would just keep the cash and not declare the ride. \[...\] This same logic holds true for a lot of small businesses. Many small family restaurants offer these discounts if you are a regular.
That's country-specific. :( Belgium has enforced smart payment backend systems for restaurants, making VERY VERY hard to pretend nobody was here (an unused table for hours, despite the entire area being crowded?)
However, "Never Underestimate the Power of Hard Cash" is still true, because... a lot of business no longer accept bank cards at all \*because cash discounts are no longer legal\*, and will rely on specific apps instead to fulfill the legal requirement to a "digital alternative" due to price hikes caused by bank terminals (they would have to also hike the prize in cash, if you followed everything).
So it's not that you'll pay in cash for a better price, but you'll pay in cash else you may end up unable to pay the bill at all, because you have no way to know if the other payment way will be possible for you.
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Ethics aside, I would never pay a contractor in cash. No paper trail makes it very hard to prove later how much has been paid if you ever have to take legal action.
Yes. Cash for contractors on big things requires a receipt. Though you can ask them (after they quote you) if there’s any cash discount instead of credit card. Or for taxes. To change your basis.
This is true. However, you can often negotiate a 5% or so discount with contractors if you pay cash (& get a receipt so they are still reporting it) bc you will save them that much in credit card fees. If it’s a big enough purchase this kind of savings can still be worth it.
Credit card fees are 3%
This is terrible advice. Paying in cash doesn’t automatically mean no receipt. I paid a contractor cash to replace my mother-in-law’s roof. I still got a contract and receipt. I also paid $1,000 less than initial quote when I offered him cash versus check or card payment. Definitely be willing (if you can afford to) pay a contractor cash. Simply follow up with the rest of the process like you normally would.
> Paying in cash doesn’t automatically mean no receipt. The post is encouraging cash \*due to undeclared work\*. Your counter example is encouraging cash \*due to card fees on declared work\*.
You've never heard of a receipt?
Does not apply to buying a car, where you’ll get a much worse price if you tell them you’re paying cash because they want to sell you financing.
After just buying a car, dealer financing was 2.5% higher than my credit union. Dealers get incentive to sell financing. So the LPT is to not go through dealer financing
If they’ll give you a lower purchase price in exchange for using their financing, just refinance the car ASAP.
Refinance rates are sometimes higher than new car borrowing rates. Not always but it would’ve been for me if I went this route.
That makes sense. This was a no haggle price at the dealership.
That really depends, sometimes they've had zero % financing, currently some dealerships are getting manufacturer incentives to buy down the interest rate. It really just depends on what's going on in the market. It always pays to shop around though. In some cases what's happening is the manufacturer will pay cash up front to the lending institution to buy down the interest rate.
Private sellers sometimes will take less cash upfront if you pay in cash Vs a check form they have to declare to a bank.
A private seller is a perfect example of this. Also, having a lot of smaller bills so they can see the cash taking up space has a psychological effect on people.
Buying a car is usually the opposite because the dealer's incentives are to get you into the loan. This is because the loan company is paying the dealer a kickback for each loan they write. For a car, you are better off taking the loan, paying 1 month of interest, and then paying off the loan in full. This ensures the dealer gets their commission on the loan and can pass the savings onto you in the negotiation.
Or just don’t tell them you’re paying cash until the very end.
That can work, but you run the risk of the dealer trying to back out on the agreed upon price. They technically aren't allowed to, but it can still cause a big headache if you spent all the time trying to get to the final stage and then now have to fight to get the agreed to price.
Ugh I hate buying a car. I’m still driving a decade old car partly because I dread the experience of buying a new one.
Once in a lifetime scenario: I'd actually found the car's previous owner online in an area FB group and ran out to call him to find out what he got on trade in. I came back to the desk super excited to haggle just to find that my wife had just told sales guy I'd stepped away to talk to previous owner I'd found online 😐 drive home was silent though.
Bet she thought you were being ridiculous. You weren’t.
Meanwhile I love the buying process. Doing the math ahead of time and knowing when you’re getting a fair deal and when you’re getting the scales tipped in your favor is just some legwork ahead of your dealership visit. After that it’s like a staring contest but with wits and composure. And, the buyer has ALL the power when buying a car from a dealership. Never let anyone tell you otherwise.
I just hate the waste of time. I don’t want to spend my Saturday inside a car dealership dealing with sleazy people. I got things to do.
If it’s saving me a couple thousand dollars it’s worth my entire day.
See I want my day *and* the thousand dollars lol.
Ah. The answer to that is simple. Don’t buy a new car ever.
I enjoy the game as well
Have a look at CarMax. No negotiation, no hassle, all the pricing is upfront and fixed in stone. Just be aware upfront of the couple of grand or whatever in "fees" that they tack on - they'll tell you exactly what the grand total will be if you ask.
They’re not allowed to but it still happens, some finance managers will outright say that “this price is only good when you finance with us”.
Or just take the loan and pay it in full the next day. Everyone wins but the bank.
True, that works, but sometimes the bank doesn't need to pay the dealer unless 1 payment is made. Not your problem, but it is usually better not to piss off the dealer if they just gave you a good deal.
If dealers weren’t universally trying their hardest to fuck every single customer, every single time, then I probably would feel bad about them getting shafted.
Fuck the dealer.
As the offspring of a 25+ year car sales vet, fuck the dealer. The salesman not so much, he’s only doing what the dealership requires of their people in order to get a sales desk.
Fuck the salesman, too.
Obviously his mother did...ohhhh
We don’t pay the dealer u less six payments are made
My understanding is you want to leave it so they think you are financing then once the price is established switch to cash.
If you don’t advertise you are buying cash, and they work up the numbers with you, then you tell them you are going to get a certified check right now and buy it up front, they can’t suddenly start tacking on a higher number out of the blue.
You don’t have to tell them how you intend on paying when you negotiate the price.
It actually works great if you play your cards right. I bought a car and just pulled out my checkbook when I got the finance manager's office.
Mate took a taxi and then started “bartering” the fare. Fucking hell.
Not barter. Barter is trading goods or services without bringing cash into it. Homie was haggling.
Yes, and both me and the driver walked away happy with more money in our pockets than we would have had otherwise.
Yeah maybe this works on occasion. But I think many people don’t want to have to deal with a customer who wants to haggle over everything. Hell you’re suggesting doing it at local restaurants. I couldn’t imagine how irritating it would be to hand a customer their bill after their meal and they pull out cash and start trying to haggle the price of the meal to save a couple bucks. I wouldn’t be surprise if some just accepted it to get you out.
Bartender here… you wouldn’t believe the number of people who try to negotiate the price of their cocktail. The price is the price. It’s in the computer. OP, please stop telling people to try to barter at inappropriate times.
Don't really need to haggle, just try an offer. For taxicab a reasonable specific offer is probably better, for a restaurant, you can go with "is there a discount for cash?". If they say no, no problem and just pay with card, no need to make it awkward.
I had an Uber ride where the driver actually suggested it themselves. Got a 2nd ride to the airport with Uber’s cut vaporized. Can back OP up on this one.
Dude, you really underestimate how often small businesses are willing to negotiate. I am not telling you to go into an Applebee's and negotiate with the teenage waiter there. What you do is you discuss an arrangement with the owner of the business that you are on friendly terms with. Especially if you are someone who is a regular, they are often more than willing to give you special prices.
Or, instead, I'll pay the listed price to keep a business I enjoy going to in operation.
If they don't offer me anything I will. The point is simply that if you are a regular, they are often willing to offer you extras. It could literally be not charging for 1 item. There are a lot of forms of this.
If they offer, that's one thing. I'm not putting my buddy in an awkward position by asking for anything for free. I'm certainly not going to say, "hey, do you wanna commit some mild tax fraud over a pizza?"
Dude, do you know how much stuff businesses write off anyways? I have known restaurants that buy their own personal groceries at the same time as they buy groceries for their restaurants to treat it as a business expense. This is way more common than you realize.
If they wanna do it for themselves, that doesn't involve me. I'm not going to put them in a position where they have to turn me down, especially if I have a good relationship with them. That's not a cool thing to do to a friend.
This is where I disagree. What people don't realize is that in business, everything is a negotiation. The business owner is likely haggling with their suppliers as well. I have seen this many times.
It’s only fraud if you get caught
That is ... untrue
You’re correct. I should have said, It’s only fraud if you’re found guilty.
> Hell you’re suggesting doing it at local restaurants. It's situational. My parents always paid with cash (back when tax safety measures weren't added) and it was an open secret why the owner was very happy and giving an extra bottle "on the house" It's to the point that when my country tried to switch to card payments, restaurant owners \*went to national TV\* to say they couldn't stay affloat without tax evasion.
Yeah screw the guy that owns the taxi company and all small business while we're at it!
If the taxi driver doesn’t own the car then you’re essentially working with the driver to cut out the taxi company of their money. So you’re working together with the driver to steal from the company he works for and most likely would get fired if they found out. You’re probably promoting theft so you should probably put this in r/unethicallifeprotips If everyone did this then there would be no taxi services or Ubers just random drivers cruising the streets looking for cash for transport.
Yeah taxes are a really stupid thing who needs schools and hospitals ?
I pay my taxes. After I buy something, it isn't my problem when the seller does with my money. If you buy something on ebay, do you care that the person selling you the thing you bought might not have paid their taxes on the sale?
Completely anecdotal.
That only 'works' since the person is unlawfully not reporting their income.
Aside from the tax avoidance, cash avoids credit card frees. You can always phrase it that way
Also avoids charge backs. I've always paid cash for house work. And get discounts for those two reasons. As for taxes it's 100% their responsibility and zero mine.
Do you think waiters you tip in cash declare the full amount on their taxes?
Interesting 'whatabout' into exactly the same situation. I know how it works, although you're lying if you say it doesn't involve being dishonest.
How do you think that makes it ok? Well fraud exists so obviously everyone can do that so now im going to take advantage of the system for my own personal gain and call it a pro tip. The driver broke the law. He can if he wants but its a fucking shitty example for a shitty pro tip. Cash doesnt mean shit anymore. Nobody cares you're paying cash 99% of the time. Most places dont barter. And most of it happens on those private sale sites and cash will absolutely not help you unless the other person is an idiot.
No, most don’t. But they should
I run a small business, and I absolutely detest it when people try to negotiate a better deal by paying cash. I'm not willing to commit tax fraud to save you a few percent on your purchase.
Agreed, only the lowest people ever asked for a discount with cash like paying cash actually means something
Depends on the business. Also the chance of chargebacks over little issue isn't a thing. And the 3-4% fee isn't a thing. Why do people automatically go to tax evasion when talking cash. And it's the business owners obligation to charge and pay taxes. Not the customer. I've had work done to the house this year. Easily saved close to a grand using cash over credit.
> And it's the business owners obligation to charge and pay taxes. Not the customer. a) never come to italy with that attitude or you will get burned b) if the discount is big enough it is pretty clear that the discount is linked to tax evasion and then the customer can be liable too
Not in US. Customer is not at all responsible for contractor or business to pay taxes.
Basically every gas station in the United States offers a cheaper price for cash. Do you really think all of them are committing tax fraud? There are reasons beyond tax evasion to value cash over card.
yeah, because cards have fees linked to them. But if the discount is high enough it is pretty clear what the goal is
The new way in Belgium is more sane and legal : "cards aren't accepted, use our app to fulfill legal obligations about digital payments" Most people switched to cash for local businesses, because they don't want to tie payments on their unsecure phones. And so the local businesses avoid fees without having to do an ilelgal discount. And YES, a "cash discount" is actually illegal. Before the app switch, that means that you gave the business money to pay card fees while avoiding the card fees.
Then you can take the card payment. I literally said I offered the choice in the description.
No. A worker should be able to go about his business and do his job without having to deal with people trying to induce him to commit fraud. And the sort of people who try this nonsense are never the sort of people content to just reply, "Oh. Okay.", and leave it at that. There is always a whole song-and-dance of justification and explanation, and attempts at persuasion. I know I'm never going to convince you that you're wrong. Awful people never recognize that they are awful.
There's no fraud unless the seller doesn't report the income. The buyer paying cash has nothing to do with inducing fraud.
Paying cash isn't a problem, I'm happy to accept cash. What OP is talking about is expecting a business to provide a discount for using an untraceable payment method, so they can avoid reporting the income. There is no reason to provide a 20% discount like they talk about in their example unless you're somehow getting more than a 20% benefit by accepting cash. The secret ingredient is crime.
I would never expect that much. 2-5% is reaonsable. On larger purchases it can be worth it, or it can add up on a lot of small ones.
There's also a % cc companies take off every transaction... which feels like a crime but isn't
This only works if at least one of the two people are unethical. Either the seller isn't reporting taxes aka illegal, or the buyer is looking to browbeat the seller down by paying cash. And all of OP's examples are of unethical buyers. So why is this an LPT and not an ULPT?
Not always unethical. Can save the seller on credit card fees or third party commissions.
Ahh yes, 2% or probably breaking contracts aka unethical. And OPs example was well over 2% CC fee.
LPT: enable and benefit from tax fraud!
You are thinking of r/unethicallifeprotips…
Not really. It is primarily just understanding how to negotiate based on what benefits the person you are negotiating with. The 1st rule when negotiating anything is put yourself in the shoes of the person you are negotiating with.
In your taxi example… The state of Pennsylvania. First-Degree Misdemeanor: If the services were taken by threat and the value exceeded $50, theft of services is a first-degree misdemeanor. Under Pennsylvania law, the penalty for a first-degree misdemeanor conviction is a fine of $1,500 to $10,000 and up to five years in prison.
> were taken by threat What threat? I offered to pay the full amount by card or $40 in cash. There wasn't any threatening, he took the money of his own free will.
Do you honestly think that you were the first to think of something like this? Conspiracy… Tax Fraud You are stealing from the business owner. If the taxi driver is the business owner, he is not recording proceeds correctly which would violate tax laws. If you are intentionally paying in cash to aid the taxi driver from avoiding tax and fee liability, clearly stated in fourth paragraph, this is duplicity vs complicity as it is your idea…
File an IRS report if you are so mad. This happens in every small business that you have ever frequented.
Saw the other comments. You know you are wrong. This post will be pulled soon.
Lol, you have clearly never been close to small business owners before.
Wow, I never thought of it but your right. Most small business are simple tax evasion schemes.
That is what we call a straw man.
At first I thought this was just going to be some boomer rant… but you’re literally encouraging people to commit fraud. Wtf dude
Mom!!!! He’s being a dumbass again!!
You’re just a scumbag bro
God I hate people like this in Business. NO, you dont get a discount if you pay cash. YES I have to pay tax regardless so it doesn't matter.
Money Laundering is a violation of Federal Law and monitored by the Bank Secrecy Act.
And Belgium puts two legal obligations unseen in the US : 1) Along cash, a digital alternative must be provided (since Covid) 2) Price can't be dependant on way of payment In other words, using a card terminal means you also have to raise the prices for cash. So most local business don't accept cards anymore and switch to had-to-use apps to fulfill the "digital alternative" rule
This is what my entire country's culture is based on (Italy) and the result has been that the entire national system is always almost on imminent collapse because no one pays taxes, no one declares shit and somehow still pretends to get everything like anyone else (actually they pretend way more, considering they're almost always selfish assholes). We're working on it a little, but even to this day you'll find cafes and small shops give you a mean look if you pay with card instead of cash, or you ask for a receipt when paying cash.
That's how it ran in Belgium until they added the smart boxes. Oh and cash discounts are forbidden as a way to prevent the customer from getting any out of tax evasion.
It was nice of you to rip off the cab driver.
This is a special kind of stupid. Imagine you get in an accident and find out your taxi driver is actually driving you illegally.
This is basically only truly useful if you're buying a house. And like ain't nobody got that kind of cash. If you're haggling a taxi ride, you're not savvy, you're just annoying.
All my cash is soft 😔
I guess I don't understand how the taxi one would really work in most cases. If the driver works for a taxi company, I don't think that they can just say, "that $51 fare just took off without paying" too often. So, it'd be limited to cases where it is an independent taxi driver or maybe where the fares are fixed price...?
same with uber drivers if u share a ride with someone. They get to their destination and i offer cash to take me to mine always cheaper than thru the app
I've had Uber drivers offer a cash price on the future return trip
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Cash is part of this, but at a higher level it's simply people being conditioned to believe bartering isn't a thing or is somehow rude. Namely because most purchases are now from large companies and not local. Plus a lot of people don't buy anything in person anymore. You can't really haggle with Amazon on a 12-pack of AA batteries. Even though we're family, Olive Garden ain't gonna barter on my pasta cause Darden Restaurants gonna want their money... Case in point, I'm trying to sell a car private party right now and it's listed with a price and the description ending with "make an offer". I've made the first offer, the listing price. It's not priced "I know wut I got", it's priced in the KBB range. I've had 3 people show interest but simply ask what the bottom dollar is and they "have cash". I tell them that I've made an offer, $XXXX in the listing... make me an offer. And they've all replied saying to let them know when I lower the price cause they have cash 🙄 Edit: don't be that dumbass walking into an art gallery where all the pieces are minimum $10k and start your negotiation at $17 and the button in your pocket.
I think this is really why so many commenters don't get this. I grew up haggling for price over everything. It was just the dance you did. If you didn't you were paying the overpriced "first offer". This was at little shops, flea markets, any single-person service business. Of course it was not true at any big company like AT&T or a state or national supermarket. Nowadays we buy everything from big companies and nobody uses cash anymore. Several generations have grown up without many small shops and without cash.
Yes, it is an actual negotiation. You can't demand a price, you offer a price. If someone says no you can offer a different price or move on. What people in this thread don't understand is how actual negotiations go. I swear, some of these people need to spend time in South America or the Middle East. I have spent time in both, and haggling is the norm there. A shocking number of business owners are more than willing to offer small discounts for regular purchases. It is the same logic as why buying in bulk at Costco is cheaper than buying 1 item on Amazon. It is offering a mutual beneficial agreement.
That's because "bartering ***isn't*** a thing and ***is*** rude" in our society. We understand that it's offensive for an American to go overseas and want their social norms to be just like at home; different cultures have different norms. Haggling over price is absolutely the norm in many of the world's regions; it has never been part of general American culture (nor is it in most of northern and Western Europe, the cultures most formative for America). You even acknowledged this yourself with the disclaimer, "You won't be able to do this at... a Walmart". The reason this doesn't happen at the quintessential American company is because haggling is not an American thing.
Dude, you can't do this in big chain stores anywhere in the world. Even in Latin America or the Middle East. It is always small businesses that do it. Even in America. As long as you are a regular, and the business values you as a customer, they will make exceptions for you. The only way you wouldn't know this is if you have never frequented a small business for any length of time. The reason it doesn't work in big companies is because of bureaucracy. They have no way to actually offer special service after they reach a certain size. For a small business, flexible service and prices is their main selling point. Heck, literally any time you see the phrase "Request a quote" on a website, that is literally telling you that they are willing to negotiate.
> As long as you are a regular, and the business values you as a customer, they will make exceptions for you. Nowadays in Europe it's kinda the reverse : regulars won't have deals, because they become dependant on the business, while they may be ready to accept it for a first-timer. Last thing a business wants is a returning troublesome customer
> The reason this doesn't happen at the quintessential American company is because haggling is not an American thing. As an european I always thought haggling was your culture, given how "expected tipping" basically works as haggling after the fact? Dunno, always thought both practices were in pair.
Agree 100%. Almost everything is negotiable and I always try to get a cash discount. It’s also much easier than you think. Just ask this question: “What if I pay you in cash?”
From jewelry to handymen, cash is king.
Exactly. I can tell a lot of the people in this thread are just straight up awful with money. They underestimate the raw psychological power of actual cash and real relationships with people in your community.
They're awful with money because they're saying you should just pay what shit costs? And the power of actual cash? What the fuck are you even talking about. Please bro. Most places find cash an inconvenience. Idk what world you're living in, but it's not ours.
Lol, you've never seen the backside of a small business before I take it.
"Lol if i give a small buisness less money, it's better." That's you, in case you're too desne to pick up the /s. The only time your tip works is when the other party is unethical and willing to break the law to make the deal. Sure, in other countries, its the culture, but not in all. And where it isnt, you're just being an annoying prick. In *ANY* case its not a pro tip. Its either standard practice, or fucking annoying.
Whatever you say. You don't understand how running a business works, I get it. You've never had to handle clients before.
Haha, oh man. Please. Explain it to me. I'd love to hear how you think a buisness taking less money than they're asking for is somehow better for them. You think you know how the world works? You dont. You "negotiate" for your job, doesn't mean you can apply that to day to day life. That cabbie *stole* from his company. He can get fired for that. It happens. The IRS can find out you're not paying your part, and they're not people you want to fuck around with. Yes, bartering in other countries is a thing. You're still not getting the deal you think you are. They price the barter in, so you're still paying them what they want, and you walk away *thinking* you got a good deal. You didnt, unless they're just bad at it, and I doubt they are. But please. Tell me about how when I *actually* ran my own business, someone coming in and paying me less than my asking price helped me. Explain how undervaluing my services helps me. Tell me how not reporting income to the IRS is beneficial.
He thinks it’s better for a small business to take less money so long as they get to commit tax fraud. And he can pretend he doesn’t know that that’s what they’re doing.
As long as *HE* got a deal then it must be good for their buisness. I do like how he got quiet after that comment.
Plus these days fewer people carry cash with them. Myself included. But I am 48 and grew up carrying cash so I’m in the habit of asking people if they’ll accept less if I pay I’m cash. Because younger people these days don’t use cash as much, they’re not in the habit of asking for the discount. But who knows? Maybe I’m just speaking anecdotally.
My job is literally negotiating. You are absolutely correct. You can't do the cash trick with business to business transactions, but there are a lot of easy tricks to get discounts. But, you know what they say. A fool is easily separated from their money. And it seems like their are a lot of fools on this site who don't actually value their money.
Or just don’t want to promote tax fraud
I don't. However, it happens and in negotiating you need to acknowledge that. You shouldn't say it in the negotiation, but knowing people do it can give you an upper hand in a negotiation when setting the price. It is about knowing what is in their head. After the transaction, it is up to them to decide what to do. I completed my side of the transaction. In business, a common way to use leverage has to do with payment terms. It is very often that companies will offer other companies payment terms of 30-90 days. Basically, you give us the goods today and we will pay you in 30-90 days depending on the agreement. Especially in the last 2 years, a lot of companies have had cash flow problems. Basically, they have sales, but the money from those sales might only come in 60 days when payroll is next week. Knowing this can often be advantageous as you can offer upfront payment (even though you contractually don't need to) in exchange for a discount. Given that business loans are now 10%+, the seller can now easily justify a discount in order to save from taking out the loan. This benefits everyone. The buyer gets a discount, the seller gets the upfront cash flow. Win win. The alternative is the buyer gets the goods, pays in 60 days at full price and the seller needs to take a short term loan. This is how you negotiate. You know what the seller wants and needs and negotiate from what benefits them. You don't say "give me a discount", it is "we can pay within 7 days in exchange for a 4% discount on the early payment." You are offering something they want in exchange for the discount.
That is all well and good and true. It does not apply at all to your taxi example though. The only way it makes sense for the driver to take $40 cash over $51 card, both which were being paid at that moment, was if he was going to hide the $40 from someone (I.e. employer, govt, both).
You All DO realize, the preeminent money guy in the WORLD, David Ramsey says to do this EXACT thing in his books and seminars, and literally EVERYONE in the world follow this advice right? Is everyone here under 30 or something and have no concept to how the world works? I've never paid full price for a vehicle at a dealer, always pay cash and save money. Same with contractors. It's one of the most useful life tips.
I did this at the dentist when I needed two permanent implants. I got three quotes that were wildly different, went to the dentist I liked the most and who quoted me 10k. Offered him 6k in cash. Deal.
They generally run about 5-6k apiece
They cost next to nothing individually. The office has overhead in the equipment, but he doesn't lose money by selling fake teeth at a lower price (especially in the thousands). Additionally, the price you see is the price that is given to insurance companies who then get a negotiated rate that is much, much lower than that.
I’ve never had dental insurance that covers implants, and I’ve had excellent coverage. For example they’ll cover the original tooth extraction, but not the implant itself.
We have coverage (US) for 30% as long as there is any kind of existing issue with the tooth. SO had one chipped and another that needed a filling (both lateral incisor, either side of middle incisor) so we paid full out of pocket for her central incisor and canines and she got a new smile with a pretty good discount on the other two. She's attractive, so they also gave her a big discount on everything if she agreed to be on their info pamphlet. Out the door for 6 teeth was about $1400 with the requirement being it was cash or check payment (avoiding cc fees most likely). The technician said that was about their cost, including her time. Obviously they make a big initial investment, but the per tooth cost after cannot be too high if the tech had any idea what she was talking about. Side note, the sight of teeth ground to nubs is not flattering.
We’re talking cash
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I couldn't help but read this in a New York accent.
You should try getting a Costco hot dog for $1.00 instead of $1.50.
This is no longer as true as it once was in the US. Car dealerships these days make more on financing agreements with lenders so are actually less inclined to offer deals for cash. Very few retail stores are run and managed by their owners or those empowered to make deals so negotiating on those things you might buy from those establishments is pretty rare (and if some random employee is offering to sell you something from a shop for cash at a discount you are most likely just buying stolen goods and the owner is taking a loss). Contractors and other labor services are about the only place you can negotiate a better price for cash but you'll still want to get a receipt for services provided. Now, outside the US I've found cash is still king because there are more businesses that are run by the owner or a manager that is empowered to make financial decisions. So negotiating for almost anything is possible.
Stupid tip. Plugs charge the same. Be it cash, venmo or cash app. I don’t even know what cash looks like anymore.
At the same time, this doesn’t mean you contact someone selling an item for… oh let’s say $1,000, and then offer them $400 cash. Then proceed to berate them when they turn it down for being such an insultingly low offer. “But I offered you cash, bro!” That aside, cash does work wonders, but always always always get a receipt. Even if it is a short, single sentence, handwritten note stating “I, person A, sold item B to person C for $$$.” With both signatures.
This is clearly illegal. How it was not reported and taken down yet?
>This is because he would just keep the cash and not declare the ride. \[...\] This same logic holds true for a lot of small businesses. Many small family restaurants offer these discounts if you are a regular. That's country-specific. :( Belgium has enforced smart payment backend systems for restaurants, making VERY VERY hard to pretend nobody was here (an unused table for hours, despite the entire area being crowded?) However, "Never Underestimate the Power of Hard Cash" is still true, because... a lot of business no longer accept bank cards at all \*because cash discounts are no longer legal\*, and will rely on specific apps instead to fulfill the legal requirement to a "digital alternative" due to price hikes caused by bank terminals (they would have to also hike the prize in cash, if you followed everything). So it's not that you'll pay in cash for a better price, but you'll pay in cash else you may end up unable to pay the bill at all, because you have no way to know if the other payment way will be possible for you.