Comments on: Right now, experience is more important than money

By: TheArtOfTheDeal

TheArtOfTheDeal — Tue, 07 Mar 2006 08:42:37 +0000

This is not negotiating. You don’t walk away from a deal because they didn’t accept your first offer. The only reason to walk away is if you can make more money elsewhere. You’re supposed to counter with a lower offer that is still above the original price. If they really want to keep you around they would have given you at the very minimum a token raise. All you got was used!

By: Tim

Tim — Wed, 01 Mar 2006 07:55:22 +0000

This is an interesting article. Essentially you advocate an attitude toward job acceptance that I have been debating with friends of mine. That sometimes you should take the lower paying job because of the contacts or the skills you will learn.

I’ve heard from many successful people that you should take a job for the skills it will teach you rather than the pay you will receive. Because the goal, if you want to be rich, is not to work for money but put those skills you learn to task in making your money work for you.

Great post! Glad I found your blog!

By: K

Mon, 27 Feb 2006 15:55:13 +0000

Personally, I would have, at the very least, negotiated for non-financial perks.

It could have been something as minor as a lunch invite with one of THEIR bigger clients (basically their personal endorsement).

By: Matt Henderson

Matt Henderson — Sat, 25 Feb 2006 16:51:40 +0000

I started out business often lowering rates and fees to “get in the door.” I *never* do this any more. Why? Customers will always expect that same rate from you in the future, and when you ask to raise your rates, they’ll assume they can get the lower rates elsewhere.

At the same time, I don’t think discrimatory pricing is a workable long-term model. Too many customers end up speaking with each other. I think it’s a better approach to determine an hourly rate based on (1) a salary you desire/need, (2) your overhead costs, (3) a percentage of profit (you’re in business after all), and (4) the effective number of chargeable hours per year available to you. (All your available time is not chargeable. Some time is spent writing bids. Some projects run over, etc.)

By: Nagu

Nagu — Fri, 24 Feb 2006 22:23:34 +0000

My hypothesis:

Experience and money are equally important but both are overrated in real world.

Ramit’s title makes perfect sense for someone who knows about one’s long term goals or at least has a blue print of it. But 99% of fresh graduates and students need another 15-20 years to discover these long term goals or to discover what they really love to do in life. In such cases, planning is overrated in the real world and there is no way to estimate the marginal benefits of long term opportnuties in the line of interest over short term for experience or money.

Thus being said, if one does not have a blue print of life, something is always better than nothing and it is one of the way to DISCOVER this love-to-do-things in life.

On the other hand, today’s world there are a few more than finite number of opportnuties for fresh graduates and students to make a living. If these students do not have any idea of long-term goals, it also makes perfect sense to walk away from a low paying offer to something that pays better, as opportnuties do exist for them. Money is as important as experience.

By: Bruce Kroeze

Bruce Kroeze — Thu, 23 Feb 2006 21:38:55 +0000

I understand your point, I just wonder what greater possibilities you are opening for the future by accepting the low wage now. I mean, if it were more contacts or opportunities, that would be something worthwhile. However, if you are merely reserving the option to continue working below your usual rate in the future, then this client isn’t really worth your time. Especially now that you’ve essentially permanently given up the edge in any future price negotiations.

Despite that, I’d probably take the job if I didn’t have anything else pressing at the moment. I’d do it for goodwill and short term cash, but that client would be first on the chopping block when it came time to prioritize. Consultants can and should fire underperforming clients.

By: Ramit Sethi

Ramit Sethi — Thu, 23 Feb 2006 15:58:47 +0000

Peter, I’ve consulted for them since college (maybe a year ago), not since high school. That would be a long time to be at the same level.

By: Peter

Peter — Thu, 23 Feb 2006 15:55:11 +0000

Hello Ramit,
In this scenario, what are the long term benefits of working for this client which you’ve already worked for since High School? If it is for contacts etc, wouldnt that have ALREADY been granted from before since you have worked there for such a long time. I agree totally with your argument that gaining Experience is a lot more important then Money when one is young. But how do you apply the argument in your scenario when there arent any more “long term benefits”. (I might be wrong since I’m not too sure about the specifics)

Sometimes, one has to walk away from existing clients if you have “outgrown” them in my opinion and go search for other opportunities. The world is such a large place, dont be trapped into thinking that your existing job is the only place with long term benefits.

By: JLP at AllThingsFinancial

JLP at AllThingsFinancial — Wed, 22 Feb 2006 23:20:30 +0000

Interesting article, Ramit. One question I have for that guy is what business is it of his if you do the work from home or any where else? Why should that have anything to do with the project. He knows your work and knows what you are capable of. It seems like they could have at least met you half way.

Anyway, it was a great article and I wish you the best. Something tells me that you will never be without!

By: Milind

Milind — Wed, 22 Feb 2006 23:00:51 +0000

I don’t get it. I think you may be right about rationalization. Sounds to me like it went 0% your way. Are you thinking of this gig as a kind of career fair you pay to attend?

Why’d you bother with college if you end up making the EXACT SAME amount as in high school? (Even if college was free, there’s the opportunity cost…) You talk about the interesting experiences and opportunities the gig brings, but you bring more interesting experiences and opportunities to them than you did in high school, and they should pay for that. If they don’t care about those things, then you should walk away not out of pride but because they simply can’t accept your incremental value. That’s why it’s “below” you.

My young friend, welcome to the world of being overqualified.