How to Lower Your Bills by Switching Service Providers

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When times are tough and money is tight, you may find yourself combing through your budget, looking for any chance to save a little cash - no matter how small.

While there may be a few chances to cancel services outright, before you take that step you’ll want to use your leverage as a consumer to shop for a better deal. Because when times are tight for you, there’s a good chance that they’re tight for service providers, who may be fighting for every inch of market share.

You could try to use this leverage to negotiate for a lower rate with your current provider. Or you might want to switch companies altogether - especially if you can land a better price elsewhere. However, when making the transition between providers, you’ll want to be mindful of a few things. Otherwise, the switch might end up costing you more or be more trouble than it’s worth.

For those who are considering moving on from your current car insurance provider, cable company, or other essential service you just can’t quit, here’s what you should keep in mind to save money:

Watch out for activation and cancellation fees 

When you’re changing companies, there might be some fees tacked on with your new provider. For instance, if you’re switching cable or home internet, you might have to pay an activation fee or to purchase new equipment.

I’ve switched car insurance companies and home internet providers since the quarantine. And when I changed internet service, I asked if there would be any fees that would be tacked on. Indeed, there was a $10 one-time activation fee. I figured it would be worth it, as I would be getting 10 times faster internet speeds.

And because I was willing to stomach the fee, I accounted for it in that month’s budget. On the flip side, the modem and router would be provided free of charge. There was also a self-installation option, which meant I wouldn’t have to pay for a service tech visit.

If the fees to open a new account are higher than the savings, or the added costs for that month aren’t merely something you can afford, then it might not be worth the trouble to switch companies.

Ask to have fees waived 

If you still want to switch, try putting on your negotiating hat and talk to a sales rep. Explain why you’re switching companies (because you’re trying to save money), and why you can’t afford to pay those activation fees (see the part about saving money). Ask if they might be willing to drop the fees or offer you credit down the line.

Chances are they want your business and might be willing to give you a few options. And if not - well, no harm in asking (or in saying no).

Make sure you time the switch correctly

You’ll want to time the switch so that there’s no overlap in service. Let’s say you’re swapping cable companies and the monthly cycle for your current company ends on the 20th of each month. When making the change, try to time it so that your new service kicks in around the 20th. That way, there aren’t days when you’re paying for both providers.

This was something I did end up doing right. Before I decided to switch my car insurance company, I checked to see when my policy was up for renewal. And I started the policy with my new carrier the same day my current one ended.

If you’re not able to time the switch in such a neat manner, you can ask to stop your service by a specific date and be prorated that amount. So if your last cycle with your cable company is 20 days, you’ll only need to pay for those 20 days and get refunded the rest.

Don’t wait to install new equipment

I failed on both fronts with this. When it came to car insurance, I switched over to a pay-per-mile coverage. With pay-per-mile coverage, you need to install a device in your car to track your mileage. I lollygagged for about a week before I installed the doo-hickey. While I didn’t end up paying for two policies, I risked losing insurance with my new carrier.

And when it came to setting up my new internet service, I also stalled. While it could’ve been easily prevented, I ended up paying for both services for about a week. Bottom line: Once you get new equipment, install it right away. Be sure to set time aside, in case you run into any snags and take longer than expected. Procrastination can be costly.

Remember when the promo period ends

If you’re hopping on a new plan because of a discounted introductory rate, be mindful of when the promo period ends. And while there’s a chance there will be new promos or your current promo may be extended, prepare yourself for when the base price kicks in. Otherwise, you could find yourself in a budgeting bind (of your own making).

You may also want to reach out to your provider before the promo period ends to see if you can get signed up for a new discounted price. If you’re not under contract, you may have to look into once again jumping ship to a new provider (or, at least be prepared to do that when you call asking for a discount).

Switching providers to save money could help your wallet, but for it to really help lower your bills you need to be smart, willing to negotiate, and able to follow through.

If you need a little more help finding room in your budget, MMI offers free financial counseling. We can review your debts and spending provide personalized recommendations. Counseling is confidential and available online or over the phone, 24/7.

Tagged in Reducing expenses, Negotiating bills and fees

A corporate headshot of Jackie Lam.

Jackie Lam is an L.A.-based personal finance writer who is passionate about helping creatives with their finances. Her work has appeared in Forbes, Mental Floss, Business Insider, and Bankrate. She's also a 2022 Financial Literacy and Education in Communities (FLEC) award winner. You can find her at

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