There is a lot of material here. I wrote this post as a mini-course in salary negotiation, everything you need to know to increase your salary. Get a beer, bookmark this page, and learn the best way to get a raise.
- Intro: The Power of Negotiation
- Video: “What to say during salary negotiations”
- Salary Negotiation Case Studies
- Six Negotiation Principles Framework
- Common Negotiation Myths
- My Favorite Negotiating Tool: The Briefcase Technique
- A Negotiation Case Study: Will’s $16,000 Raise
- How to determine how much salary you’re worth
- Adapting with Changing Negotiation Conditions
- Top Performers Demand Their Worth
- How can you apply these lessons to negotiate a raise?
In college, I had the opportunity to teach a “Student-Initiated Course,” or basically a course on whatever I wanted. So I got together with two of my friends and we put together a course on religious studies.
Now, Stanford gave us incredible flexibility to teach essentially whatever we wanted…but the student instructors never got letter grades — it was always Pass/No Pass (everybody always passed), issued by the sponsoring professor.
Until we came along.
You see, I was never the smartest person in any school I attended. But I got pretty street smart over the years. And so I petitioned the sponsoring professor to let us teach the class for a letter grade. I negotiated with her and convinced her to let us recommend our own grades (!), back it up with evidence, and she would approve it.
We would basically write our own ticket!
One of my co-instructors was amazed that I convinced the sponsoring professor to agree. He signed the papers to enroll for a letter grade instantly.
But my other co-instructor hesitated.
To give you some context, this guy was a PhD student in Computer Science at Stanford and had previously attended IIT, one of the most competitive technical universities in the world.
“Dude,” I said, “what’s your problem? Sign the damn papers. We’re going to get an A+, guaranteed. Take it for a letter grade!”
“No, Ramit,” he said, “I don’t know about this. I cannot take the risk.”
“What the hell?”
“Well….if I don’t get an A+, it will bring my GPA down.”
I just stared at him. It actually took me 10 seconds to understand what he meant. And then I got it.
An “A” is a 4.0. An “A+” gives you 4.3.
The only way an “A” could bring his GPA down was if he already had over a 4.0 GPA — he was just too modest to say it.
I was speechless. How do you even respond to that? “Ok,” I mumbled. Ever mindful of the risk, he didn’t sign the papers — and ended up taking the class Pass/No Pass.
By the way, we got an A+. I never let him live it down. Sucker.
We’ve now entered Week 3 of my 30-day course on hustling.
- In Week 1, I covered how to automate successful scripts into your life, including successfully interviewing at top organizations/companies/universities
- In Week 2, I covered the psychology of persuasion, including getting raises, changing your behavior (like going to the gym and automating money), and changing others’ behavior
This week, I’ll show you how to negotiate better than 99% of people.
Below, I have a video, case studies, and a new negotiation framework to use.
Within 48 hours, I’ll ask you to share your successful negotiation tactics with other IWT readers.
Let’s do it.
The power of negotiation
One of the reasons Americans loved Saturn cars was the “no-haggle” policy — which, to an Indian, is code for “let’s charge these suckers more because they’re afraid of negotiating.”
Have you ever seen one of your friends try to negotiate? It’s so sad it makes me want to cry. Imagine the most timid person getting the courage up to finally ask for something.
Timid weirdo: “Excuse me sir…do you think you might possibly maybe somehow discuss the salary with me? I am thinking –”
Hiring manager: “I’m sorry, it’s a set salary.”
Timid weirdo: “Okay” (head down, internally saying “I shouldn’t have even bothered”)
There is another way.
Here are just a few of the things you can negotiate:
- Credit card APR
- Salary (like my friend’s $8,000 salary negotiation)
- Gym fee
- Cable fee
- Cellphone fee
- Days off from work / work from home on Fridays
- Complimentary room upgrade at hotels
- Car insurance
Best of all, negotiation is a HUGE WIN.
Every successful salary negotiation is a cumulative benefit — and your salary will almost always continue to increase from there. If you negotiate a $5,000 salary increase for your first job, that single salary negotiation will be worth tens of thousands of dollars to you over your lifetime.
If you spend 30 minutes negotiating your cable bill, it’s worth hundreds of dollars. How many lattes would you have to give up to equal that?
This isn’t theoretical. Thousands of my students have used negotiation techniques in all areas of their lives to improve how much they make, how much they work, and how they live.
Let me show you some case studies.
Salary Negotiation: What to say for a multi-thousand-dollar salary increase
I taught my friend how to negotiate an $8,000 increase in salary and a 50% boost in equity in 4 hours.
In this video, learn how to:
- Negotiate with an experienced recruiter
- Rebound after you undercut yourself
- Why reading a salary negotiation book is not enough
- Know when to be adversarial and when to be cooperative
Contract negotiation case study: Raising your rates
Note: This is not just about raising your freelance rates. You can apply this technique to areas like getting a salary increase.
In this video, you’ll learn:
- The HUGE mistake I made when I asked for my first raise
- How to seek out high value work AND make the time for it
- The “solutions perspective” that leaves your clients ADDICTED to your service
- An exact script to build in automatic raises in the future
Notice that I made every mistake in the book. We all make mistakes negotiating. I still get rejected all the time when I try to negotiate. But each time I do, I learn something and improve my skills for the next try.
3 readers who negotiated their way to success
Example 1: “This is almost 30k more than what I was making previously”
IWT reader Mark writes about how he negotiated a $30,000+ salary increase at a new job:
“Not sure if you still have time to read all the stories thanking you, but I’m thanking you for it anyway.
I’m doing a job search now, and I have been going through your stuff on negotiation. I made the mistake early on (hard to avoid, actually) of giving out my previous salary; for one thing, I have had a lot of headhunters talking to me, and I didn’t realize this one was a recruiter (working on behalf of the company I’m being considered for). For headhunters I don’t care as much because it’s in their interests to get me a higher salary. But now of course I was worried about being boxed in. This also made me realize I was a fool to not care about a raise at my last job, as you covered in one of your videos, since it negatively affects things going forward.
Fortunately he posed the question over email, which I think tilted things in my favor.
I just want to make sure you are interested in the position and get a good feel as to what your time frame for making a move is? Also, I know we discussed briefly but I was hoping to get more clarity on what you are looking for from a compensation standpoint?
As for compensation, I’m not sure I could quantify that without getting a feel for where my skill level fits in with some of the other consultants after meeting with them during the tech interview. We had discussed the probable need for some training on the business side, but I’m basically looking to make market rates for a C# developer, so I’m sure your consultants are within that range.
From a compensation standpoint, we would probably be looking in the $100k + or – range. It really depends on how the other interviews go.
This is almost 30k more than what I was making previously…he knows this. But here’s the real coup-de-grace: I was going to be stupid and say something like 80-90k, but I shut up and put it back to him, and look what we’ve got.”
Example 2: “I quoted $125/hour. They accepted. Within 2 hours.”
IWT reader A.B. writes about how he negotiated his FIRST-ever consulting deal:
“[COMPANY NAME] approached me about hiring me as a consultant. They want me to basically look at their programs, blogger outreach, creative, and copy and tell them what I think sucks from a blogger’s perspective. They don’t want me to endorse them, just tell them what turns bloggers off.
They took me out to fancy dinner in Vegas (during BlogWorld), as I was skeptical of working with them. They overcame some of the skepticism, but obviously wanted a quote.
As you may have guessed, I’ve never consulted with a company, nor had any idea what to quote them. I assumed they wanted 5-10 hours-ish.
As I was sending them a quote, i struggled with what to quote (time & money) – I literally thought “What would Ramit do?”. I would probably do it for $47/hour realistically right now, but knew that was way too low. I ended up telling them my rates were $197/hour, but if they booked 40 hours (remember I thought they wanted 5-10) I would give them $125/hour.
They accepted. Within 2 hours.
Which I know means I offered too low, haha, but I’m o.k. with that. Learning experience. They think they want more like 60-80 and have sent me estimates that point to so, but are guarantee’ing 40, including paying for all expenses to fly me out to [LOCATION] in early November.
They’ve also indicated that they’d like to have an ongoing relationship after this initial 2-3 month period.
This $5,000-$10,000 is a great place to start for me (I haven’t advertised any consulting ever… they came to me). Even though I could have gotten more (likely) I would have NEVER thought to push that high in hours or rate had it not been for your influence.
Next time I’ll quote double. ;-)”
Example 3: “With a 12-month lease, that is a savings of $1800!”
IWT reader Sharon C. writes
I’ve been reading your blog for about 2-3 years now and I’ve learned a lot of useful tips over the years. The biggest thing I learned so far is that you can negotiate a lot more things than you think you can (and don’t be afraid to ask)! So the leasing office sent me a notice that I need to renew my lease for my apartment in San Jose, or they’d make me pay $50 more month-to-month (which is normal).
I was paying $1585 (up from $1515 about 1.5 years ago) and I’ve lived in the apartment for 3 years. I heard that rent has been dropping in my area due to the economy, so I called up a few competing apartment complexes and asked them for their current price on a similar square footage apartment. The average was about $1400 so I knew I was overpaying.
When I went to ask for a rent reduction, the office kept on insisting that I was already paying “market rate.” I let them know that I was serious on leaving if they didn’t give me a lower rate. I talked to a higher up manager and after about a week, she was able to give me a rate of $1435 which is $150 off my previous rent! She stated that since we had lived there for 3 years she was able to give me the lower rate, which is the same rate as what the last tenants that moved in are paying.
With a 12-month lease, that is a savings of $1800! It also saves us the trouble of moving out. Thanks for your blog and all the work that you do!”
As you know, this month I’m focusing on hustling, or doing extraordinary work to achieve disproportionate results.
Negotiating is a key part of hustling. Not only does the behavior matter — knowing what to say, how to say it, when to NOT say something — but the mindset of “Yes, I can negotiate that!” is critical.
In fact, the powerful principles behind negotiation are critical to understand.
6 negotiation principles you can apply today
Here are 6 principles of negotiation you can apply today.
1. Know what you want.
If you walk into a salary negotiation without a number, you’re at the mercy of an experienced hiring manager who will simply control the conversation. That’s what they do. When you know what you want, not only can you communicate that crisply to the other person, you can demonstrate why — and this forces you to prepare for the negotiation. In other words, you can’t just say, “I want to make $95,000!!!” You have to SHOW why you’re worth it. This single distinction can be worth thousands to you.
2. Know who you’re negotiating with
. When someone negotiated with me, he kept offering things I didn’t care about, like “I can also do X for you, and Y, and Z.” But had he taken the time to find out what I REALLY wanted — reliability — he would have been able to offer specific examples like a weekly digest of what he’d accomplished and what he was working on the next week. And he could have charged me thousands for that peace of mind. Instead, I didn’t hire him.
3. Have a toolbox.
Amateurs walk into a negotiation and just “wing it.” Top negotiators have a “toolbox” of options to use. If the other person doesn’t seem to care about vacation days, they press that lever. If the other person seems flexible on pay (which happens more than you’d imagine, like in the above example), a good negotiator will get a higher salary and trade something else. Creating a toolbox can be as simple as writing 2 columns on a piece of paper — “What THEY want” vs. “What I want” — but can get much more sophisticated.
4. Practice relentlessly
. Most people will lose tens of thousands of dollars over their lifetimes due to their failure to practice negotiations. Actually, most people won’t negotiate at all. But even the people who negotiate rarely practice. It feels “weird.” Who would I practice with? What do I say?
Yet if you don’t practice with a qualified friend or colleague, why would you expect to get good results in a real negotiation with a competent adversary? Hiring managers do this all day. Hotel clerks have heard everything under the sun.
One of my favorite things to do is share the practice I’ve done in the form of scripts — like the negotiation scripts in my book. A lot of times, people are skeptical about the book until they try one of the scripts…then they realize, “Wow. This works.”
5. Have a fallback
. There’s a classic psychological technique called the “Door in the Face” technique. It goes like this: “Hey Mike, would you donate $50 to the Save The Whale Foundation?” “Hell no.” “Ok, how about $5?” And donations increase dramatically.
If you’re negotiating, odds are you’ll fail. That’s fine — expect failure. Embrace it. Turn “failure expectation” into domination.
6. Don’t shoot your first basket in the NBA
I am trying to use more sports analogies to try to fool people into thinking I care at all about sports. As you can tell I have a long way to go.
Anyway, your first salary negotiation shouldn’t be against a hiring manager. Start off small — in a real-world environment — at your local farmer’s market. Try negotiating on Craigslist. By the time you get to the real negotiation, the one that matters, you’ll have several negotiations under your belt. The difference will likely be worth thousands.
5 MYTHS of negotiation:
These are classics but I continue hearing them and it’s driving me nuts.
Myth 1: Negotiation has to be adversarial.
This is a good excuse that people use to avoid negotiating. “I don’t want to be mean” or “He’s just a small-business owner.” First, an effective negotiator is rarely mean. Instead, they explore the situation and use words like, “We’re close, but we just need to find a good fit here” rather than “I hate you and please die…ps can you give me a deal.”
Myth 2: I need to read (and read, and read) about negotiation before I try it.
Yes, you do need to get educated. But you’ll learn 100x more from practicing 5 negotiations than from reading yet another book or blog post about negotiation. Try searching Google for “How to negotiate salary” to see how terrible most of the advice is, anyway.
Myth 3: You can negotiate anything.
I just got this email from a reader:“I have a situation where there was an $150 application fee to apply for a membership to the YMCA. The application fee was paid and there were attempts to have it waived but they did not budge. Now the fee has been reduced and other attempts to get the application fee they paid back have not worked. Are there any tips/suggestions/script suggestions they could try to negotiate with them?”
My response: “Sometimes you just have to eat the costs.” You can’t negotiate everything. And you’re not entitled to a deal on everything. But pick your battles, because the right ones can save/generate tens of thousands of dollars for you.
Myth 4: Some people are born negotiators.
I was bred to be a negotiator by my parents. For example, my mom would show me how to negotiate at department stores when I was a little kid. Then, visiting India, I saw the game taken to a whole new level. The point is, the people around you matter. Practice matters. Sure, none of us may ever be the world’s top negotiator…but we don’t have to. If we just become marginally better negotiators than we currently are, we can reap disproportionate rewards.
Myth 5: I don’t know as much as the other person to “win” a negotiation.
First of all, try not to look at a negotiation as win/lose. A lot of people think somebody has to get screwed in a negotiation to get what you want, but that’s completely backwards. Of course, you can’t just make a demand and expect the person on the other side of the table to just give in. You have to make a case for why they should give you what you want. But if you’re prepared, it doesn’t have to be a scary experience. In fact, if negotiating is done right, BOTH parties come away feeling like they get what they wanted.
An employer is happy to give a raise to keep an employee who does outstanding work and provides value every day. Credit card companies, hotels, insurance companies, even restaurants are willing to offer discounts to keep valued customers, or earn the business of new ones. Just be prepared and give it a shot! You’ll get some “no”s but you’ll be surprised how many “yes”es you’ll hear.
The internet makes being prepared for any negotiation a breeze. Consider a salary increase. Websites like salary.com or glassdoor.com show what companies all over the country are paying for particular jobs. If you’re being paid at or below market average, but an above average contributor at your job, resources like those really add some weight to your argument.
Edmunds.com shows what people are paying in your area for the exact make and model of car you’re searching for. With that information in your back pocket, you won’t ever pay too much for a car again.
TO DO THIS WEEK
- Spend 30 minutes — but only 30 minutes — reading the case studies, scripts, and examples on this page: How to negotiate.
- Pick ONE of the following areas to negotiate:
- Personal finance (credit card companies, cell phone bill, etc.)
- Craigslist (Preferably your selling something, but buying is ok)
- Farmers/Flea Market (See what crazy deal you can put together)
- Your Job (Go for big wins, like a raise or tele-commuting)
- Your Clients (raise your rates, or put together longer term contracts)
- Find a creative way to get it done BY WED NIGHT.
- Leave your results of the negotiation, AND THE SCRIPT YOU USED, in the comments section of this post with the heading “WEEK 3 RESULTS” by Wednesday at 11:59pm PST.
Note: Be respectful when you negotiate. Never take advantage of the other person and never get rude. Negotiation is a back-and-forth dance where you find a solution agreeable to both of you. You’ll see the collaborative way I approach negotiation in my examples. Please treat this exercise with respect.
Also note: Unless you’ve been planning to negotiate your salary for a long time, I would not encourage you to negotiate it in 48 hours. A successful salary negotiation takes longer than that, and I don’t want you to jeopardize your chances of success down the road.
With that said…
Think BIG. Bonus points to anyone who negotiates something incredible, like a free computer or a trip to Jamaica.
The person who gets the best results can choose between…
1) $200 of my favorite negotiation books shipped to your door or….
2) A 15-minute call with me to coach you on becoming a skilled negotiator
My favorite negotiating tool: The Briefcase Technique
The Briefcase Technique is an advanced negotiation strategy that has earned me tens of thousands of dollars in my own career, and many thousands more for my students. Hardly anyone is confident or prepared enough to use this during a negotiation, but after this 2 minute video, YOU will be.
Sign up below to see the video above and learn what the Briefcase Technique is and how to use it at your next interview or negotiation:
A Negotiation Case Study: A $16,000 Raise
Today, an in-depth look at the techniques that one of my readers, Will H., used to negotiate a $16,000 raise.
Before you read, be sure to acknowledge any psychological barriers you may have about asking for a raise.
For example, many people will say, “A raise? In this economy??” That is a barrier: If you are indispensable, and your boss knows it, you have a good shot at negotiating a salary increase in any economy. However, if you think the economy solely dictates your compensation, then you are, by definition, not a top performer.
Using the right techniques helps, too…like doing the homework and practicing a negotiation over and over — which 99% of people will not do.
Watch how Will did it.
“I’m not being paid what I’m worth”
Will is an interaction designer for a non-profit research institute in the Bay area. He loves his work.
He was also a self-described “personal finance nerd.” Will stumbled onto I Will Teach You To Be Rich when another blog linked to my post on weddings. We all know that weddings are expensive, but he was impressed by the analysis of why it might actually make sense. Looking around the rest of the blog, he found another idea that really struck a chord with him:
When it comes to increasing your net worth, you don’t just have to save money — you can also focus on making more money. Most people who read personal finance advice get so caught up in saving a few dollars every week that they miss out on the far more effective (and less punishing) method of bringing in more money.
One of the most effective ways to do this is to negotiate your salary.
Since Will had joined this firm right out of college, he’d quickly gone from doing junior-level work to giving presentations to important clients and taking on more and more responsibility managing his projects. Now he wondered if his salary reflected that growth in value.
He read some of my posts on negotiation and wondered, “What do I have to lose?”
“I’m not going to wait until my next performance review”
Working up the courage to pursue his raise, Will was inspired by the phrase, “Success in life is directly proportional to the number of awkward conversations you’re willing to have.”
He wanted to be very successful, so he was willing to skip the easy route and confront uncomfortable questions: Will this damage my relationship with my boss? How much am I really worth? Will all this extra work pay off?
Most people simply worry about these questions, letting low-level concern hold them back from taking action. Will wrote down the questions and potential answers, going from worry to constructive next steps.
He wasn’t willing to wait until his next performance review. He quickly decided that it wouldn’t be enough to simply browse a salary research website and come up with an average number based on his job title and geographic area. He wanted real leverage, to give himself as much power as possible in negotiating a significant raise.
He needed to find out how much he was really worth – not just his job title, but his whole package: his specific skills, personality, experience, conversational ability, and everything else that set him apart from some nameless aggregate on the internet.
How to determine how much salary you’re worth
In addition to the usual salary.com and payscale.com, Will wanted to get even more specific about how much he was worth.
He decided that the only way to learn his true market value was to the market and find out. He decided to respond to job openings in the area and to go into the interviews with an open mind. After all, even though he was perfectly happy with his current job, he would naturally be willing to jump ship if he found a much better fit somewhere else. And his research would help him determine his true market value, which he could bring back to the company.
At first, he was nervous about looking for another job while still employed. But he was able to convince himself that he had been providing so much value to his employer that he deserved to get some of that back. And, the best way to do that would be to get some experience interviewing, quantify his value, and to come back with the ability to say, “Rival company X thinks I’m worth Y — what can you do?”
Not only would this get him some valuable experience holding his own in nerve-wracking negotiations (which he’d be soon able to use with his manager), but this kind of real-world proof would be much more compelling than following the path of least resistance and simply presenting a number from a salary website.
Notice the difference between top candidates and mediocre ones.
- Mediocre candidates let others drive their lives — they let their bosses set the agenda, they let their bosses set the timetable for salary discussions, and they let their bosses decide their salary.
- Top performers respect their bosses experience and skill, but they are different in two ways: First, they provide extraordinary results for their companies (rather than being focused on process, like how many hours they worked. Who cares about that?) Second, they employ a mindset that THEY will drive their own careers, whether that means asking for the best work, asking to run projects, or even asking to discuss a salary increase. They run it — not somebody else.
Paradoxically, great bosses love top performers who run things.
Will Uses The Briefcase Technique in Salary Negotiation
Will began interviewing with other firms with the goal to secure several high-salary offers, then take them back to his own boss.
But what kind of unique value could he provide to the interviewers? He couldn’t just sit there and answer their questions about his experience. Instead, he had to offer something so different from the other candidates that he would be sure to get the offer he was looking for.
His first interview was for a software engineering position. Sure, he could write code, but his real strength was interaction design. He would get through the preliminary phone interviews answering whatever questions they had about engineering; but, when it came time for the in-person interview, he was going to take control of the conversation.
His plan was to define the sort of work that he would be doing and convey to them that he was uniquely qualified to provide an amazing value that would solve specific problems they had.
Will came into the interview prepared. Spending about five hours total, he had evaluated the company’s website and made a list of 30 things they could do right now to improve it, even if they didn’t end up hiring him.
Having learned the Briefcase Technique from Earn1K, Will understood the value of presentation. He kept the “briefcase” in his back pocket during the initial interviews, waiting for just the right opportunity.
Finally, he found himself in an interview with the VP of Technology talking about engineering. Now that he’d made his way through the middle management guys, Will felt that this was finally someone with a high-level enough view that they could appreciate the value of good design. When the time was right, Will explained that while he could do engineering, he could actually provide them with far more value by improving the user experience on their website.
That’s when he pulled out the big white binder he’d prepared.
The interviewer was so impressed that he called a product manager into the meeting. It turned out that the company hadn’t even been thinking much about user experience, and Will had provided them with a huge amount of totally unexpected value.
Total cost? 5 hours of time and $5 for a few binders.
Get the Briefcase Technique video here:
Won’t They Just Steal My Ideas?
As he’d prepared for the interview, Will had met a surprising amount of resistance to his idea. His friends worried that the company might just steal all his great ideas and hire somebody else.
But Will didn’t see it that way at all. He’d learned from this blog to just go in there and test assumptions. It doesn’t make sense to guess what someone will do when you have the chance to actually test it.
He understood that simply stealing the ideas didn’t make sense from a value prospect perspective. Presumably there was a lot more where that came from, and these 30 ideas were just a taste. Sure, the company could steal them, but they’d be a lot better off hiring the person who could execute them.
If you build real value for someone, they will want to forge a relationship with you.
Worst case scenario? If they simply stole his ideas, it was their loss and he could always try again at the next place.
Adapting with Changing Negotiation Conditions
Will got the job offer, but the salary was lower than he’d hoped for. (It was a startup, so they’d put a big chunk of the compensation into the form of equity.) He’d been hoping for a number that could inspire shock and awe at his current job, but he soon realized that is wasn’t so bad – after all, his current employer didn’t necessarily care about the exact amount of a rival offer — but simply the fact that a rival was trying to poach their employee at all.
(Notice how a top performer will roll with the punches, adapting as conditions change.)
With his new leverage in hand, Will now felt comfortable to negotiate a raise. At this point, he made one of his most important decisions: He didn’t speak to his direct manager. Instead, he targeted the influencer who would feel the most pain if he left: the project’s technical lead.
Meeting with her, Will framed his concerns not in terms of money, but from the standpoint that he’d been providing a lot of added value over the past year and wasn’t sure that it had been properly reflected back to him. The company just wasn’t properly structured to take full advantage of his skills.
When she asked if he had already made his decision to leave, he said no — he would rather work it out and remain there. He let her know that the rival company was more agile and that — over there — he would be able to give his input at an earlier stage and focus more on the user experience. “What can you do to match that and keep me here?”
This shifted the burden onto them, and it made the project lead consider what their company might be doing wrong. How might this rival company be doing better?
The project lead came away feeling that she was the person with the power to keep Will at their company. People respond well to pleasure, but even more so to pain, and she knew that both the company and she herself would feel it if he left. She took it upon herself to argue his case to the lab director.
One more thing: She was the one to bring up salary – “I don’t know what you’re making now, but I wouldn’t be surprised if it wasn’t enough… I think a title change might also be appropriate.”
The $16,000 Raise
The next day, she had scheduled Will a meeting with the director. While he wasn’t especially familiar with Will’s work, the project lead had primed the pump and explained that this guy is really valuable to us – we need to do whatever we can to keep him.
Once again, it was the director — not Will — who brought up the issue of money, “Salary – what are you thinking?”
Using the leverage of the rival company’s offer and his skilled in negotiation practice, Will first established his value (going over how much he had done and could do for the company), then explained that his current responsibilities felt more like those of a senior user experience designer. He threw out a number that he thought was really high, and the director responded, “I’ll see what I can do.”
At that company, raises usually only happened at the end of the year, but Will got his the next day – an increase of $16,000 (along with a promise from the lab director to focus more on user experience).
Top Performers Demand Their Worth
Nowadays, Will’s on the fast track. Sure it had been a little awkward to reveal that he had been interviewing at other companies, but the decision makers also respected him. Going in there and demonstrating his value got Will noticed by the senior management, and his project lead has now taken a vested interest in him and has been helping his career along.
The best part is that, even if he decides to eventually move to another company for real, the increased salary will stay with him. Once you start making more, you keep making more year after year.
And it’s all thanks to a couple of white binders.
How can you apply these lessons to negotiate a raise?
- Understand that top performers (1) drive extraordinary results and (2) employ a mindset of driving their own career — instead of letting a boss determine their future for them
- 85% of a negotiation happens before you ever set foot in the room, including deciding to negotiate, doing extensive research — including competitive intelligence, if necessary — and practicing the negotiation
- A large salary increase is one of the quickest ways to earn significant amounts of money. In fact, a large salary increase in your 20s or 30s can drive over $100,000 of income over your lifetime, since a newly negotiated salary will now be a baseline benchmark to work up from
- Whiny complainers about “this economy” are likely (1) not top performers and (2) looking for an excuse to do nothing
Do you know your actual earning potential?
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