Special thanks to David Bakke for providing this guest post in honor of Financial Literacy Month.  David writes for Money Crashers, one of the top personal finance blogs online. His strengths include money management, smart shopping, budgeting, and finding the best deals possible.

I'm a frugal fanatic, and saving a buck on day-to-day items like groceries and bigger purchases like electronics is basically second nature to me. I take the rule of spending on "needs" but not "wants" to a new extreme. But when it comes to major expenses and long-term purchases, it's tough to feel frugal in the face of high price tags. It's a completely different side of the savings game: The art of negotiation. I was surprised to learn how much room for negotiation many sellers have, and if you don't know when to ask for a discount, you could be losing thousands of dollars. Here are seven types of expenses you should always negotiate down on.

1. Home Improvement Projects
   Considering that the housing market is far from total recovery, many contractors are hungry for work. Demand is low, which is great news for you as a potential client. Take the time to get two or three competitive bids, and ask your preferred contractor to come down below the rate of the lowest estimate. After you get a better estimate, but before you sign with a contractor, find out how low they can go. Before you commit, ask about ways to save even more. The price of building materials has fallen as much as 35%, so can your contractor get a discount on materials and pass the savings on to you? Dare to haggle and find out what the absolute minimum price for labor will be. I saved 15% on a recent home improvement project by shopping around, and then cut my cost by another 20% by accepting less expensive materials and negotiating the hourly rate for labor. 
   
2. Mortgage and Refinancing
   Another by-product of the down housing market is an opportunity to negotiate rates and fees for your home mortgage or re-financing deal. The industry has become much more competitive across the board, and you need to capitalize on this competition. Shop around for your mortgage or refinance deal. By visiting a few different lenders (e.g. Quicken Loans for mortgage refinance rates), you'll get a feel for the range of deals available, and you'll be gathering data to make your case for a lower rate with the lender you want. You don't have to stop at one round of comparison shopping either. Re-shop those deals! Call the competing agencies and say, "Here's the deal I've found. Can you beat it?" Remember, even lowering your interest rate by a quarter of a percent can translate into huge savings over the life of your loan. And keep in mind that some lenders are willing to waive or reduce mortgage fees like closing costs, application fees, and origination fees just to get your business. 
   
3. Automobiles
   You might dread the experience, but you probably already know that there's room for negotiation when you buy a new or used car. But I don't negotiate like the average car buyer. I really get down and dirty when dealing with car salespeople. They're overbearing, relentless, and they never give up. And I decided that if I have to deal with the agony of buying a car, then I'm going to leave it all on the field and go rock bottom with my offer. Once I choose the car I want, I combat the sticker shock by starting off with an unreasonably and ridiculously low offer. It's the best way to get a little edge before negotiating a car loan. Next, don't make the mistake of letting the negotiation center around your monthly payment. Lowering the monthly payment but extending the term of the loan is a deceiving tactic that many dealerships use. If you get a lower payment but the loan ends up being for 60 months instead of 48, then you're probably still spending more in the end. Salespeople know the conversation is moving quickly, and doing the quick math to divide by 12 months isn't easy on the fly. Instead of falling into their trap, focus on the length of the loan and the interest rate. Finally, make a point to walk out of at least one dealership. The sales staff will hate to see you go, and sometimes you'll get the absolute lowest price to get you back in. Whether they let you walk or bring you back in, it's worth it to get the confidence boost and learning experience of a successful walkout. It's a win-win situation, since you'll either get a lower price or take your business to a better dealer. 
   
4. Clothes
   Everyday clothing items at chain stores usually have fixed prices. But if you're shopping for higher-end apparel or business attire, you have more room to negotiate than you might realize. Stores that sell men's suits, for example, are always running enticing deals to get you into the store, and their price points are very flexible. When a salesperson knows that you're interested in a $300 suit, see if they can bring the price down by $25 or $30, or ask if they're willing to throw in accessories for free or at a discount to seal the deal. And if you're at a designer store for men's or women's fashion, try to muster up the courage to ask for a cut rate. Especially if you're paying cash, many boutiques will give you a break on the original price tag.
   
5. Any Big Retail Purchase
   Only a few years ago, I learned that you can negotiate prices at a retail store, even the major chains. You can stop leaving money on the table with major electronic purchases like computers, televisions, or sporting equipment. Of course, it won't work for a purchase like a $50 digital camera, but if you're spending $100 or more, you can usually work a clerk down on price. Salespeople who work on commissions want to get your sale in the books, and they want to get it as quickly as possible. In many stores, they're authorized to come down by 10% or 20% from the sticker price. And if you have the nerve to keep pushing, often a supervisor can bring the price down even more. Retail negotiation is where I learned the biggest lesson on major purchases: It never hurts to ask. The worst thing that can happen is that they say the sticker price is a final offer, and then you can either agree, or try the walkout move that I mentioned earlier. 
   
6. Monthly Services
   Don't assume that just because a bill comes every month that it needs to be the same rate every time. Especially if you're not locked into a contract, take the time to contact your cable provider, Internet service provider, and cell phone carrier periodically to ask about promotions that don't require contract renewal. Or simply remind them of lower rates from competitors and ask if they can meet or beat someone else's deal. In the highly competitive telecommunications industry, where companies continue to pile on fees and rate increases, you're well within your right to ask for a break from time to time. And since it would be easy for you to switch, most providers will be very accommodating, especially if you are persistent but reasonable in your requests. 
   
7. Medical Bills
   I haven't had a chance to try this one firsthand yet, but I recently learned that many medical bills are negotiable. I'm going to see how it goes the next time I visit the doctor's office. When insurance companies are involved, most people assume that the costs of medical procedures are fixed. In reality, they aren't. If you talk to your healthcare provider's billing administrator, you'll learn that there's a range of possible fees for certain procedures. Even better, billing administrators often have permission to apply a 5% or 10% discount to patients. It might be reserved for "friends and family," but if you're comfortable in your doctor's office, take a chance and ask. Medical professionals know that times are tough, and they don't want you to stop visiting the office because money is tight. They're running a business too, and if you can't afford to come in, they're losing money. Doctors are facing plenty of challenges from government agencies and insurance carriers, and they'll gladly take a small hit on their practice's profits to keep you on your regular schedule. You don't want to think of your doctor like a car salesman, but he or she is probably just as worried that you'll "walk out" as any other business owner would be.

Final Thoughts
The more I shop and negotiate, the more the lesson rings true: There's no harm in asking. As a consumer, you have more power than you might think. While salespeople may seem rude or abrasive in some situations, you're really in control until you hand over your money. Clerks want their commissions, and stores want to make their sales. Especially now, while businesses are struggling, managers are willing to give up some profit to complete an order. Take advantage of this situation. There's no shame in asking for a discount, and there's nothing embarrassing about walking away. You have other stores to try, both online and off, so don't be afraid to walk away from a deal if you don't like the final price. Play the competition to your advantage.

What other expenses have you negotiated? Share your success stories and biggest victories as a consumer in the comments here.

Of all the major purchases people make in their lives, few are more based on emotion than buying a car.

While I am all for helping the economy and the environment, the awesome thing about a clunker is that is (hopefully!) paid for in full. If you are one of the more than six hundred thousand who got cash for your clunker, you are the proud owner of a new car… and possibly some new debt.