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Salary negotiation: How to negotiate better than 99% of people

Salary negotiation techniques to put you in the top 1%. With videos, example scripts, case studies, and new negotiation tools.

Ramit Sethi

Have you ever watched a friend or family member try to haggle on a car or negotiate prices at the store — and completely fail?

It typically goes something like this:

Timid negotiator: “Excuse me, sir . . . do you think you might possibly maybe somehow lower the price on this item for me? I was thinking — ”

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Salesperson: “Nope. Sorry, it’s a set price.”

Timid negotiator: “Okay.” (head down, internally asking themselves, “Why did I even bother?”)

And it’s not just when haggling for a car or something at the store — people timidly approach salary negotiations with the exact same weak attitude…which is RIDICULOUS!

I LOVE salary negotiations. With just a five-minute conversation, you can both earn a Big Win and make thousands more a year — which really adds up over your lifetime.

Check out this chart that shows how much a $5,000 increase in salary can add up over the years:

pasted image 07

If there’s an earning potential of MILLIONS, why would you want to throw your chances away with a weak approach?

Unfortunately, there are a lot of misconceptions out there when it comes to negotiations.

Which is why I’d like to address them first before diving into HOW to negotiate your salary. After that, I’ll detail the exact steps to nail a negotiation.

How to negotiate salary

Salary negotiation myths
5 steps to NAIL your salary negotiations
Find the exact salary you want
Identify the issues the company is facing — and how you can solve them
Prepare the Briefcase Technique…again
Have a fallback position ready
Practice negotiating relentlessly

Perks to ask for beyond salary
A to-do list for this week

Bonus: If you just can’t wait and want to learn all you can about salary negotiations, download my Ultimate Guide to Boosting Your Salary.

Negotiation myth #1: Salary negotiations need to be adversarial

Here are some common phrases of people who don’t want to negotiate their salary:

  • “I don’t want to be mean.”
  • “He’s just a small-business owner — I’ll just pay him what he wants.”
  • “I hate arguing with people.”

The first thing you need to realize is that you shouldn’t be mean while you negotiate — quite the opposite. You want to explore the situation with care and nuance. After all, both the salesman and you want the exact same thing: for you to buy the product.

With that in mind, when confronted with a denial to an offer on an item, rather than saying, “OMG THESE PRICES ARE AWFUL. YOU MUST BE CRAZY…plz give me a good deal?” you’ll want to say something like, “We’re close, but we just need to find a good fit here.”

Negotiation myth #2: I need to read (and read, and read) a lot about negotiating before I do anything

This is one of the biggest pitfalls someone can get into when they’re trying anything new — studying instead of doing.

Don’t get me wrong, you do need to get educated. BUT you’ll learn 100x more from practicing 5 negotiations than from reading another blog post or watching another YouTube video about negotiating — and yes that includes THIS article.

Negotiation myth #3: You can negotiate everything

Unfortunately, sometimes you’re just going to have to eat the costs for something you want because the simple truth is you can’t negotiate everything.

After all, you’re not entitled to a deal on everything — but you CAN pick your battles, because the right ones can save/generate thousands of dollars for you.

That said, there’s still a lot you CAN negotiate. Anyone with Asian parents can tell you that.

In fact, here’s a list of just a FEW of the things you probably didn’t know you could negotiate — I know because I’ve both done it before AND have taught thousands of people to do it themselves.

  • Car insurance
  • Cell phone plan
  • Gym membership
  • Cable
  • Rent
  • Credit card

Check out my video on negotiating your bills for more on this topic.

Bonus: For the exact word-for-word scripts that I used to negotiate my bills, download the Ultimate Guide to Personal Finance.

Negotiation myth #4: Some people are born negotiators

Let’s make one thing clear: negotiating is a skill. And like any other skill it can be learned, honed, and mastered.

Luckily, I learned from some of the best negotiation masters of all: 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 when they dealt with salespeople in stores and markets.

The point is, the people around you matter and 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 than we currently are, we can reap disproportionate rewards.

Negotiation myth #5: I don’t know as much as the other person to “win” at negotiations

This kind of goes back to negotiation myth #1: stop looking at negotiating as a win/lose situation.

People seem to think that someone has to get screwed over 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 other person to give it to you — you have to make a case for it. Credit card, insurance, and cell phone companies are willing to offer discounts to keep high-value customers. And an employer is equally happy to give a raise to keep an employee who does fantastic work and provides value every day.

You’ll hear some people say “no” but I promise you’ll be surprised by how many people say “yes!”

As long as you prepare and are ready to make your case, salary negotiation becomes a lot less scary.

Which brings us to . . .

5 steps to NAIL your salary negotiations

These 5 principles will help you prepare for your negotiations, allowing you to talk to the hiring manager confidently and be ready to earn more money.

Remember, though, all the prep in the world won’t amount to ANYTHING if you don’t actually negotiate your salary.

Step 1: Find the exact salary you want

If you walk into a salary negotiation without a hard number, you’re going to be at the mercy of an experienced hiring manager who will simply control the conversation. That’s what they do for a living.

When you know what you want, though, not only can you communicate crisply to the other person, you can also demonstrate why you deserve that much.

That’s why you can’t just go in and say, “I want to make $100,000 a year!!!”

Instead, you have to show them your value — I’ll go into this more later in the article with the Briefcase Technique.

If you’re unsure about how much to ask for, though, there’s only three crucial pieces of advice I can give you:

  1. Research.
  2. Research.
  3. Ask for a million dollars…just kidding! RESEARCH.

Before you even speak to the hiring manager to negotiate salary, you should have done as much research as you could about what the average industry pay is for your job. Only then can you properly apply the tactics in this article to effectively negotiate salary.

To that end, there are a few great resources for you to find a good place to start:

  • Salary.com: This is a great website for both employers and job seekers to compare compensation rates for specific jobs across a huge variety of companies.
  • Glassdoor.com: Though this site primarily acts as a “Yelp for jobs,” it also includes an incredibly handy salary tool that allows you to look at the national average salary for your job as well as the average rate of compensation in your city.
  • PayScale.com: This website sends you a personalized salary report based on a questionnaire you fill out regarding your career history. It’s especially great for recent college grads.
  • Ask a friend: Do you know anyone who has worked in this field before? Maybe a friend of yours has been in the industry for a few years. Ask them how much they were paid — as well as advice on how much you should ask as well.  
  • Google it: A search as simple as “average digital marketer salary” will give you a wealth of information that you can use.

Only with sound research can you ever expect to negotiate well.

Step 2: Identify the issues the company is facing — and how you can solve them

I once had a guy I interviewed for a job. He negotiated with me — but he kept offering things I didn’t care about.

He said things like, “I can also do [X skill that doesn’t matter] for you, and [Y work that’s already getting done by others], and [Z value that I’m already doing better myself].”

If he had taken the time to find out what I REALLY wanted — which was reliability — he would have been able to offer specific examples, like a weekly digest of everything that he accomplished and what he was working on the next week.

If he did THAT I would have been more than happy to pay him thousands more for the peace of mind.

But because he didn’t take the time to find out what I wanted as the employer, I didn’t hire him.

Which is why it’s so important to identify the main issues the employer is currently facing so you can later find out how to solve them.

During the interview, ask whomever you’re speaking to a lot of pointed questions regarding their pain points. I LOVE it when I get asked questions like:

  • What’s something that you would like to improve within the company — and how can I help?
  • What traits do you value the most in a new hire?
  • How can I help with your most important goal this quarter?

Remember: you can add a lot more weight to your salary negotiation if you crush your job interview.

Once you recognize all of the areas where you can add value to the company, you’re going to use one of my most favorite techniques…

Step 3: Prepare the Briefcase Technique…again

This is one of my absolute favorite techniques to utilize in interviews, salary negotiations, client proposals — whatever! And the beauty of it is that you’ve already done 90% of the work before you started speaking to the hiring manager.

Ideally, you’ve used the technique already during your initial job interview in order to wow your employers.

But now you’re going to use it AGAIN utilizing the information you learned in step 2.

Here’s how it works:

First, you’re going to leverage the information from step 2, and create a 1-5 page proposal document showcasing the specific areas in the company wherein you can add value.

Then, you’re going to bring the proposal with you when you negotiate your salary. When the question of compensation inevitably arises, you’re going to pull out this document and outline exactly how you’re going to solve the challenges of the company.

Hiring manager: So what’s your price range?

You: Actually, before we discuss compensation, I’d love to show you something I put together.

And then you literally pull out your proposal document detailing the pain points of the company and EXACTLY how you can help them. IWT bonus points if you actually use a briefcase.

By identifying the pain points the company is experiencing, you can show the hiring manager where specifically you’re going to add value — making you a very valuable hire.

Approach the proposal as the most compelling menu they’ve ever received — complete with issues that they know about and how YOU are the person to solve those problems.

I go into even more detail on the Briefcase Technique in this 2-minute video. Check it out below.

Step 4: Prepare a fallback position

There’s a classic psychological technique I’d like to introduce to you called the “Door in the Face” technique.

Imagine there’s a nonprofit worker soliciting donations to a homeowner.

Nonprofit worker: “Hi, would you like to donate $50 to the Save the Whale Foundation?”

Homeowner: “Hell no.”

Nonprofit worker: “Okay, how about $5?”

Homeowner: “Hmm okay, sure.”

See what the nonprofit worker did? He knew he wasn’t ever going to get $50 — but he also knew that if he gave a drastically reduced amount after his initial ask, the homeowner would be much more susceptible to donating.

You can do this by asking for a salary higher than what you would settle for. At worst, you’ll meet in the middle with the hiring manager. At best, you get a higher salary.

Remember: if you’re negotiating, odds are you’ll fail — but that’s totally fine. You should EXPECT failure. Embrace it. And plan accordingly by turning “failure expectation” into domination.

This 6-minute video shows you strategies — including word-for-word scripts — that’ll help you command their respect and make them excited to pay you what you’re worth.

Step 5: Practice negotiating relentlessly

How do musicians get to Carnegie Hall? The same way you earn thousands in a salary increase. Practice.

Most people will lose tens of thousands of dollars over their lives due to their failure to practice negotiations. Actually, most people won’t negotiate at all. Even when people DO negotiate, they won’t practice.

They’ll say things like:

  • “It feels weird.”
  • “Who would I practice with?”
  • “What do I say?”

IT DOESN’T MATTER!!!! That’s why you’re practicing.

As I always say: Don’t shoot your first basket in the NBA. After all, if you don’t practice, you’ll be going into negotiations cold with a hiring manager whose job it is to negotiate all day.

So find a friend or family member to run through tactics with. You can even go to your local farmer’s market and haggle for small items or try negotiating on Craigslist. Every little bit helps.

Here are a few question scripts you should prepare responses for — and have your practice partner run through with you:

  • “What is your salary expectation?”
    Answer this using the information you gathered from step 1. By the time you walk into negotiations, you should already have a firm number or range in mind.
  • “There’s no room in our budget. We can’t possibly give you more money.” 
    LIE!!! If they tell you something like this, make sure you DON’T FALL INTO THIS TRAP. This is a scare tactic companies often use to make us settle for less than we deserve . . . and pocket the money that should’ve been ours.
  • “What are you making now?”
    This question is asked by employers to see if you’re making the industry average. After all, if you’re NOT making the average, they’re going to wonder why? And this greatly affects what they’re going to offer you.

That’s why it’s so imperative you showcase how you’re going to add value to the company with the Briefcase Technique before the question of salary comes up — so that you’ll look incredible once it does.

Follow those steps and you’ll be set up for success when negotiating your salary.

Perks to ask for beyond salary

Salary is just the first step of what you can negotiate in the process. In fact, there are a big number of benefits you can negotiate if you’re a top performer.

They include:

  • Telecommuting. That’s right — you can actually negotiate with your boss to convince them to let you work from home.  
  • Stock options. Some companies offer options for their employees to incentivize their work. Though there are often times a fixed number for all employees to receive, you can actually negotiate for more stock options with the understanding that you are a top candidate.
  • Vacation days. Paid time off and vacation time are benefits most every company offers — but not many people realize that you can actually negotiate your vacation days too.

For each of these, it helps to simply remember the ARMS technique. An example using telecommuting:

  • Agree. This is a nice psychological trick by giving your employer something they agree with first — so they’re more apt to go along with the rest of your pitch.
  • Reframe. Instead of showing your employer how much telecommuting will benefit you, you’re going to show them how great it would be for the company to embrace it.
  • Make your case. Here you make your pitch: Sell them on the idea of you working from home — but give them an out by saying you’ll work in an office if it affects your work output.
  • Shut up. When you’re done, you’re done. Yield the floor and let the employer speak.

Here’s a great script you can use to negotiate remote work.

You: This is great news. I’m thrilled to be invited to join your company and look forward to adding great value to the organization.

That being said, I’m afraid the commute time will affect both my work flow and focus. It would make a world of difference if I could work from home a day or two each week.

Hiring manager: I’m sorry. We don’t do that here.

You: [Agree] I understand that your company hasn’t done it in the past — but this could be a great opportunity. We have the technology to make everything possible.

[Reframe] If it works out, we can find candidates in other states for XYZ roles.

[Make your case] And given my credentials and background, testing it out with me on a small scale is low risk. If it doesn’t work out, we can always go back to the old way.

[Shut up] So what do you think?

And if they agree, good job on the Big Win! If not, that’s fine too. You can always go back during your review period and pitch again after you’ve really shown your value to the company.

In this video, I interviewed my friend Justin Wilson, a former management consultant and absolute MASTER at negotiations. We ran through a mock negotiation wherein he expertly negotiated for benefits outside of salary.

Check the video out at the 2:52 mark.

To do this week

Here’s how to get started:

  1. Spend 30 minutes — and ONLY 30 minutes — reading case studies, scripts, and examples on how to negotiate.
  2. Pick ONE of the following areas to negotiate:
    1. Personal finance (credit card companies, cell phone bills, etc)
    2. Craigslist (It doesn’t matter if you’re selling or buying)
    3. Farmers/Flea market (See what great deals you can put together)
    4. Your clients (raise your rates, or put together longer term contracts)
  3. Find a creative way to negotiate something within 3 DAYS.
  4. Leave the results of your negotiation, what you took away from the experience, AND THE SCRIPT YOU USED in the comment section below.

Remember: Be respectful when you negotiate. Never take advantage of the other person and never get rude.

Once you do this bit of practice, you’ll be ready to negotiate salary.

If you want more great tips and strategies, join my Insider’s List below for FREE to find out the tactics and scripts to help you find your Dream Job.

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124 Comments

 
  1. Alex Dumitru

    An excellent post Ramit. I have been negotiating with my partners for about 2 years and I managed to increase my payments with up to 300% percent. Until then I though you can only negotiate in the marketplace and not in every business. Though I’m glad I discovered it’s always possible to negotiate and I always do my best when signing the contracts.
    I think last year I’ve got 50 grand just from negotiating 🙂

  2. Eber

    Excellent post, but you would get more respect from your readers if you didnt have this “sucker” and “weirdo” attitude. Anyone who is not “smart” like you should be treated with that kind of disrespect?

    • Andrew Carpenter

      He’s trying to eliminate the precept many Americans hold (limiting their willingness to negotiate) by changing your perception of yourself when negotiating (hence, calling individuals unwilling to negotiate wierdo’s a.k.a.unconventional). Also, what you don’t realize is that your simply projecting your own viewpoint on to others. Just because you lost respect for him when he called those unwilling to negotiate wierdos, doesn’t mean that anyone else lost respect for him. I sure didn’t, if anything I gained respect.

      AHC

  3. Stepan

    Awesome article Ramit. I’m going to negotiate the hell out of a gym membership by Wed, and I’ll get back to you when I win big.

    Regards,
    Stepan

    • K00kyKelly

      Watch out! The gym’s new memeber people are seasoned negotiators!

      The key with negotiating a good deal on a membership is to be willing to walk out (or at least look that way). Don’t expect to work out the day you sign up. Don’t wear your workout clothes to the gym. …and worst of all don’t have a friend waiting for you!! Many people join a gym with a friend or join a certain gym b/c their friend is there. Whatever you do… don’t let them know that you’re planning to join this particular gym. You can do some research online to figure out what your gym’s rock bottom rates are, but don’t expect them to budge easily.

    • Cory Teague

      @ Stepan, you want a gym membership go to costco, the negotiating has been done for you. They have a 24hr fitness membership 2 yrs for $299, That comes out to about $12.50/month with no initiation fee. Average cost directly from 24hr is $29.99/month with a $50 initiation fee. This would be a savings of about $420. Please tell me where you can get a better deal than that (other that working out at home) and I will call you a true negotiator.
      Cheers,

    • Ramit Sethi

      Sometimes it’s not just about cost
      Sometimes it’s not just about cost
      Sometimes it’s not just about cost

      I said that 3 times because it’s that important — and oft-forgotten.

    • Tim Rosanelli

      With gym memberships, I would be willing to pay more for a close gym that I really liked, because these factors will greatly determine if you actually go and get results from the gym. I feel travel time is very important in the gym I decide to use because the time wasted driving is time that I could allocate to bigger wins and earning more money.

  4. Tweets that mention How to negotiate better than 99% of people | I Will Teach You To Be Rich -- Topsy.com

    […] This post was mentioned on Twitter by Ramit Sethi, TheHappyRock, Erica Snyder, dmongan, Doug S and others. Doug S said: RT @ramit: How to negotiate better than 99% of people: http://bit.ly/hux859 […]

  5. Gal @ Equally Happy

    A couple of stories from the other side of the negotiating table. At my previous job I had a brilliant job applicant right out of school. I offered him a salary, which was a bit low (he was after all, straight out of school). He countered and said “hire me on for 3 months at this low pay as a contractor. At end of the three months you can either fire me or we renegotiate pay”. He was right. Three months later I hired him full time at 10% higher than I initially offered. Lesson learned – part of negotiation is talking about time frames and proving value.

    Second story – This woman was relatively experienced. She came in, said “I want X dollars an hour but I’d be willing to settle for Y dollars”. Y was about 40% lower than X… Really? Never tell me what you’re willing to settle for. Why would I ever offer you anything above that?

    • Jon

      Maybe “Y dollars” is what she actually wanted and she just used that large “X dollar” number to make Y look more doable. Or maybe she just goofed. 🙂

  6. AD

    I have found that just asking in the first place will often yield results, even though I’m not as comfortable with the haggling part.

    @Eber: I disagree. When in a negotiation situation and feeling uncomfortable or about to cave, I’ll probably think to myself to quit being such a timid weirdo.

  7. Andrew Carpenter

    “You miss 100% of the shots you never take.”

    – Wayne Gretzky

  8. James Clear

    I’m really looking forward to this week.

    Obviously, I think practice is the biggest key. You can learn all you want, but you won’t know how to win the game unless you play it.

    Baker has a great example of playing the game here: http://manvsdebt.com/negotiation-tips-for-beginners-a-real-life-example-of-how-i-saved-150-with-just-a-few-questions/

    I thought you also made a great point about the myth of negotiation being adversarial. I find much better results if I’m cooperative rather than argumentative.

    That’s how I got to feed a White Tiger. (Full story here: http://www.freemoneyfinance.com/2011/01/5-steps-to-help-anyone-negotiate-for-things-money-cant-buy.html )

  9. Azzam Sheikh

    Cool article.
    Just went through the video ‘Negotiate like an India’ and got a job interview in feb first week.

    2 dilemmas, 1) really want the job 2) I got the job interview at 9am this in mind mind tells me that others are interviewed after and I got be drowned at the end of the day.

    With substantial job cuts here in the UK I can only imagine that other competent interviewees will be attending. What do I do about the salary negotiation?

    The company actually mentioned a range of £5000 and my previous pay fell £2000 less then what is offered on the top end.

    I believe I did well during a phone interview and covering letter since I address ONLY the point that I saw standing out regards to the phone interview and the inclusion in the cover note which was Time Management of employees.

    It is a digital media company and they create web design, iphone & ipad apps, etc. I understand clearly their issues at hand regards to managing projects between clients and developers and the issues faced since I have personally been in this role.

    I believe that I am exceptional candidate for the role but at the same time think that I may not be enough. I hate that feeling.

    I will be prepared to answer the question when they ask about the ideal expectations of salary, however should I go for whatever is on offer just to get the job?

    I will kick myself since I know how demanding the role will be especially if they have never had a structure in place before for managing employees and I will be responsible for building this from scratch. It just means I will be working my butt off and giving more then expected.

    Honestly I do not mind, this is how I have excelled before and worked ‘beyond the call of duty’. Regardless should not one deserve to be paid for the effort they put in?

    So I am running a script in my mind as I type and will come back here once I have written it up

  10. Danny Rosenhaus

    When I was in college I was an intern for one company and another company shared the office space. I was asked to do some Excel work for them and they asked me how much I charged. I said $12 (good for me then) and the boss said, how about $20? Of course I accepted and he told me I needed to aim higher (or lower depending on whether you’re spending of getting). I was then able to negotiate $50 and $100 (this was part of a $300 reduction over the price of 3 people) off on two trips I took through a tour agency in the middle east (Cairo and Petra), that was $125 saved over 4 days, I was the only one who payed less on the other trip. And the only reason I payed less was because I said you got me a discount on the first trip, now I want one here, it worked. Negotiating brings a certain sense of pride that everyone appreciates.

  11. Alex

    Not sure if my case technically counts, because it’s a nice negotiation I did last week. Still, I think it’s quite instructive and deserves being here.

    Here is my situation. I needed to send a large shipment (about 3cm of personal belongings) out of Switzerland. I got a recommendation for a company that has a lot of expertise doing the deliveries in my situation and asked them for a quote. The quote was in the range of 8000 CHF (Swiss Francs – about $8500), utterly overpriced in my opinion. No asking for discounts and reductions helped, basically the company rep let me understand that this is the price in Switzerland because local labor is so expensive, and that even if I reduce the amount of items drastically, I might get a discount of max 500 CHF.

    Throughout the negotiation, I had this feeling that the power is at the company side, and I’m at an extremely week position, essentially at their mercy. Still, if not for the price, I’d really prefer their service because of their expertise.

    I was a bit desperate, tried looking for other means of sending, such as post, UPS etc., but all had different drawbacks. Finally, I googled for something like “container shipping”, got a list of whatever companies came up in the search and started asking them for quotes. I got several quotes in a few days, in the range of 1500-2000 CHF, and started comparing them to choose the one to do my business with.

    Then I got the idea that my situation has changed – and my negotiating position was different now, and decided to try my luck with the original company. So I wrote them that I got such-and-such offers, but I would prefer their service because of their expertise, if only they could give me a reasonable quote. I also mentioned that I reduced the volume of the things to ship.

    I would have probably agreed to price as high as 3000 CHF, because the shipping with them would be much less hassle, but to my astonishment, they offered me a price of 2000 CHF! Note that their previous position was a very firm price of 8000, and it got down to 2000 just from a mention of alternatives I have (their way to get down the tree was to say that they, completely accidentally, have some spare space in a container they are sending next week. whatever 🙂 ).

    To summarize:
    Total time I spent trying (unsuccessfully) to convince the company to lower my price: about 2 hours.
    Total work to search around and get alternative offers: 1 hour.
    Total time I spent negotiating after having competing offers: ~10 minutes to write the email.
    Total saving from having a stronger position: 6000CHF.

  12. Perfecting Parenthood

    Negotiating is very simple, you nailed the hard part, which is trying. There are no myths, just lack of confidence.

    My partner and I are buying a commercial property for 950K. It was originally listed at 1.15M. We did some background research on the seller and found out he was getting a divorce and we surmised that he had to liquidate to settle his affairs. We made up various reasons that the price should be that low and we got to 1M. Then we inspected the building and found that the roof and boiler were old (as would many similar buildings) so we asked the guy to pay us another $50K for the roof and $25K for the boiler. In the end he agreed to the roof but not the boiler because he disagreed about the price -> we created an escrow account instead that would pay for all actual boiler repairs for the next five years. We did it all respectfully and the seller was actually helping us to complete the purchase, helping us arrange the financing and providing as much honest advice as possible on the tenants, state of the building, etc. We got a 20% discount on his asking price which turned a decent deal into a great deal.

    We did the same thing on an apartment building the year before but this time the seller wouldn’t move as far. We walked away from that one. We don’t take decent deals, we look for great deals.

    I’ve found that the greatest lesson is to be able to walk away. If you have two job offers, one for $150K and one for $110K, then how easy would it be to get the $110K one negotiated up. Very easy because you simply wouldn’t take anything lower than $150K. What if you didn’t have the 150K one in your hand? Much harder. The key is to still have the confidence to walk away. If I know you will take $110K, I’m not giving you any more. If you know I’m willing to pay $150K you won’t take any less. If we both don’t focus on that part, but instead focus on each other, then we’ll split and each get half the benefit at $130K.

  13. mariana

    hey!!

    very cool and useful info.
    i just signed and ive received everything about week three…. what about 1 and 2???

    • sambista77

      Hey
      week one: http://www.iwillteachyoutoberich.com/blog/recap-of-week-1-automating-successful-scripts/

      week 2: http://www.iwillteachyoutoberich.com/blog/testing-optimization-bars/

  14. Jess

    Ha! Where was this post last week, when I had my annual performance review, Ramit?

    I’ve posted about this earlier, but I’ve been working on getting a raise all during the past year. I have kicked ass at work, taken on a ton of projects, gotten FREE software training for myself and co-workers (started a company-wide user group with a co-worker and partnered with SAS Institute). I also put some real work into my self-evaluation and gave lots of examples of ways I’ve benefited the company in the past year. Then I took a deep breath and gave myself the highest overall rating possible. That was back in December.

    Last Thursday I had my performance review. My boss also gave me the highest overall rating (reviews are tied directly to raises, so this is key – if you’re in the middle of the range, you get a measly 2.5% raise, below you get nothing, and above you get more) and said a bunch of nice things about my performance, so I asked to discuss raises. I mentioned that I really liked the position, my boss, the company…but that I have certain salary “goals”, and that a friend of mine–who I actually trained a couple of years back at another job–just got an initial salary offer higher than what I’m making now (I did negotiate an extra 5K when I started this job, but I made the classic mistake above of telling the recruiter what I’d accept and naming a number too low – even though it was 40% higher than my last salary).

    My boss said that his best workers aren’t necessarily the highest-paid workers, and that he was working on getting a good raise for me with HR. He suggested that we wait to see what HR comes back with next month, and then he would have additional meetings with them as needed.

    So this one is a work in progress still. I also asked my boss about the possibility of changing my job title (which would also net me a bigger raise) in light of my added responsibilities. I am expecting that HR will probably come back with a raise of around 5%, which is decent, but I want more – around the 10-15% range would get me around market value, but that’s going to be tough to get. I negotiated working Mondays from home last year, and I may ask for Fridays from home also in this go around.

    He is going in to see his boss this week and asked for some talking points about the user group, so I put together a 10-slide presentation, complete with some glowing quotes from co-workers that I’d been saving. Hopefully this will also help. Next month is going to be key, so I’m trying to get any advice I can get and not wuss out at the last minute.

    I noticed that my boss kept steering the conversation away from raises during the review, and it actually took me a couple of tries to finally have “the talk”. But I also know that one of my co-workers who badly wants a raise didn’t even ask during her review! I’m glad I at least asked.

    • Ramit Sethi

      A good example of a game being played around you that you don’t even know

    • K00kyKelly

      Chat up anyone you can about how people get raises where you work. Once you start digging you’ll start to see what levers to push to get the raise you want.

      Often with the type of company where your manager is the good cop who really wants to give you a raise and HR is the bad cop that polices the raises you’ll need an offer from another company in hand to get a significant raise. It is a risk obviously. If you say you have this offer and will quit if they don’t match… then if they don’t match you kinda have to take the other job.

  15. Laura

    Week 3 Results:

    I used the negotiating scripts to talk my way partially out of an annual credit card fee. Amex has just hit me with a $95 annual fee. I had called last week and talked to a representative who tried to switch me to a card with less benefits and no annual fee.

    Today, I called and went through the automated system to start cancelling my card. When I was connected with a representative, I explained that I was ready to cancel because the $95 fee was too much for me this year. He reminded me of one of the benefits ($99 companion ticket) that outweighs the annual fee; I countered that I hadn’t used that benefit in the last year so, I probably wouldn’t use it this year either. He reminded me of the free checked bag ($50 savings round-trip), and then he threw in a $50 customer loyalty bonus to be credited to my account immediately.

    So, I negotiated the $95 fee to a $45 fee. Not a huge deal, but it only took two ten minute phone calls. I think I could have talked him out of the fee completely if I’d tried harder, but I had to get back to a timed experiment I was running.

  16. Hoarders and Negotiation | caseyfriday.com

    […] have to be painful.  You can make it into a fun game.  Ramit Sethi just posted an article about How To Negotiate Better Than 99% of People.  This subject is very near and dear to my heart, because as you probably know (if you read my […]

  17. Jennifer

    You’re right. Most negotiation tips online are crap. Thanks for posting advice that doesn’t suck. The video roleplay was especially helpful.

  18. masterQ

    “WEEK 3 RESULTS”

    Me: Hi Sam, I want to refinance my car note.
    Sam: Sorry sir, you can’t just refinance your car note.
    Me: Why not?
    Sam: We can’t refinance our own loans, but we can do this… We can add $1000 to the note and apply for a new loan. When you accept the new loan, we will give you back the $1000 to use as payment to the new loan. Nothing is coming out of your pocket. It seems the best rate now depends on your credit score and the rate is from 3.59% to 14%.
    Me: I have exellent credit, lets see what I can get.

    Summary: I went from a 5.5% APR to 3.59%. Saved $235 for going in a asking what I wanted. Granted that I had a great credit score to get the lowest APR that was offered, but I saved money for going in and talking to a specialist for 30 minutes during my lunch break. Otherwise, if I were not proactive and didn’t do this homework assignment, I would have lost that $235. Thanks, Ramit for posting this. I wish I could have done this sooner and saved more money.

  19. shawn

    Here’s something somewhat subtle that I picked up in the video at 9:41. The use of the phrase “what you’re comfortable with” puts the interviewee, Susan, in the mindset of what is the lowest number I can make comfortably. If you can pick up on those things, you can find wiggle room upward. Susan at that point needs to be thinking is that all the employer wants is for me to be “comfortable”?

  20. Brian

    I don’t think I’m going to win any prizes, but I was able to knock $60 off my auto insurance. First I checked a couple competitors websites and realized I was already getting a pretty good rate. Not deterred, I called up my insurance company and poked around for potential discounts… eventually I found out that I was getting charged $5 a month for paying with my credit card. That was an easy fix. They also let me know my fender bender a couple years ago comes off my record in October so I can negotiate a lower rate then. Plus they threw in basic insurance for when friends borrow my car (not sure if that was already covered or not) for free. Overall a successful call!

  21. Laura Roeder

    Great post! My mom is a great negotiator so I learned some of this growing up as well. I actually always thought that bargaining was just the “normal” process of booking hotels because that’s how I always heard her booking them growing up. Also she’s a pro at garage sales! I always use her technique of “I’ll give you $5 for all this stuff”.

    I make a habit of negotiating some things, like the farmers market, every time. Here’s an easy line everyone can use “what kind of deal can you give me for two?”.

    I ask that every time I buy more than one of anything at the farmers market, even if its something like apples that of course you’re going to buy more than one of. 90% of the time they will knock something off the price just because you asked.

    You can also ask if they’re discounting because it’s getting near the end of the day (if it is near the end of course).

    The individual savings are small, but doing it for every item for my groceries every week definitely adds up!

  22. Laura Roeder

    Posting another small one because it will be useful to others . . .

    Sat down with the company that does my renters/car insurance to see where I could lower my fees. Discovered that they were charging me for AAA membership, which I’m also paying out of pocket to AAA! Kind of sheisty in my opinion for them not to say that I was already in their system when I joined? But anyway I was able to cancel one of the AAA memberships, and I learned that’s a pretty common thing! So an easy way to negotiate is to find out exactly what you’re paying for. That’s not even really negotiating, just being aware.

  23. George

    Today I received a bill from my new internet company. The price quoted didn’t seem quite right, so I hopped online and found out that they were trying to stick me with a $30 installation fee… when I had ordered the self-install kit and set it up myself!

    I gave the billing department a ring to get things sorted out. Here’s the script I used:

    “Good evening! I’m calling about a question I had on my most recent bill.”

    * pulls up account details*

    “I’m just looking here online and the system is telling me that I have a $30 installation fee. When I talked with the sales representative last month, he specifically assured me that there would be no installation or setup fee with this product. How can you help me to get this fee taken care of?”

    And with just a few sentences I was $30 richer! That’s a nice dinner out for the price of a phone call. It may not be the most creative or valuable negotiation reader’s submit this week, but I just wanted to let everyone now that it really is that simple and easy. Just gotta get out there and try it!

  24. wilson usman

    okay mine is kinda short,

    Sometime ago me and my girl went to get some fast food and ordered nuggets, it was late and I guess the person in front of us had ordered the last of them. So instead of going somewhere else, I took a shot…I ordered something else, when I got to the first window to pay I told the lady if I could speak with the manager “because out of nowhere I thought hmmm this is an inconvenience” I told her since I could not get what I wanted, should I had to pay for the order, she said I understand sir sorry you don’t have to pay for it.

    sure this was a few bucks who cares right, but I thought why not give it a try right? and it worked.

  25. Bogey

    When I had the opportunity to change jobs recently, I decided to aim pretty high when it was asked how much I was looking to earn. At the time, I was earning $50k. I told the hiring manager that I was looking for something in the high $60’s to mid $70’s. The next day he offered me the position with a salary of $80k. Perhaps I left something on the table here, but then again, this was a lateral move for me (albeit, to a better organization). Market rate for someone with my experience in this position (about 1 year) is probably around $65k. The range I asked for started just above the market rate, and the offer came in even higher then my range.

    I think the very best negotiating tip I can provide is to do research on the market rate. Go to the very top of what you deem to be the reasonable range. Then, ask for a range that starts slightly above that amount and goes up. Worked for me.

  26. rishi

    That video was awesome. Thank you for that!

  27. Tweets that mention How to negotiate better than 99% of people | I Will Teach You To Be Rich -- Topsy.com

    […] This post was mentioned on Twitter by Ramit Sethi, Julia Birks. Julia Birks said: Mad props to Ramit @ IWT for the awesome tips on negotiating your salary http://bit.ly/en8sfR […]

  28. Justin L

    I’ve tried negotiating with my banks before and was told “oh well your monthly interest rate is based on your balance so there’s now way we can change that” But I’m going to counter that this time.

    At the job I just started last september, I was offered $30k, and I responded that there was low for the industry and the area, and was looking for more like 35k. The hiring manager responded he had very little flexibility for starting pay but could go up to 31k, so I took it. Now I’m going to prepare for my upcoming review and point out the steps I’ve taken to increase my own productivity at work and how I can apply to the whole department to help others do more in less time.

  29. Ross

    When negotiating a salary I have learned to turn the hiring manager’s best technique (and the question that makes you squirm) against them. In my first conversation with a hiring manager or recruiter I always ask “What salary range have you allocated for hiring someone for this position?”. The results are amazing, and totally turn the tables in your favor. Instead of you awkwardly dancing around the question of “What is your current salary?”, now you have taken control. In my last interview I asked that question up front (when the recruiter said “Do you have any questions before we get started”) and he told me the exact range they had allocated for hiring for the position I was about to interview for. I realized the dollar figure I was looking for was at the lower part of that range, and filed that away. After spilling the beans the recruiter asked “Is that something that would work for you?” and I slow-played saying “We might be able to make that work, do you have any flexibility in that figure?”.

    When I got the initial offer from the hiring manager it was the bottom of the range the recruiter had told me about. From there, with the knowledge of what they had already allocated, I was able to negotiate to the upper end of the range, and get my moving expenses paid for by using another negotiating technique. I always like asking for more than you know they can give. In my first counter offer I asked for four additional things (higher salary, signing bonus, no waiting period on 401k matching and an additional 5 vacation days). I knew that the easiest thing for the hiring manager to do was increase the salary and possibly the signing bonus, and I didn’t care about the other two items that much anyway (but he didn’t know that). He came back with a second offer just as I expected “Sorry, we can’t do the 401k and vacation, but we can do an increased salary and moving expenses”. I asked for a final small bump in the salary and the deal was closed. 1 phone call, 1 interview and 3 emails = a 28% increase in salary.

    • Ramit Sethi

      You complete me

    • Dove

      Wow!

  30. David Shefchik

    WEEK 3 RESULTS

    I’m home with the rents for a couple months before I leave for South Korea to study abroad, and they just purchased a new HD tv. Unfortunately, the HD programming with Comcast usually costs an arm or a leg. My dad had been talking about calling up and trying to convince them to give us free HBO for a few months for being loyal customers, but after reading some of the material here I decided that I would handle it and go for a bit more. Here’s how it went:

    Me: Hi, I’d like to cancel my service.
    Rep: Oh, I see. Is there any particular reason you’re dissatisfied?
    Me: Well we just bought a new HD tv, but the HD package I’ve found is way too expensive.
    Rep: Well I’m sorry to hear that, did you know that we’re running a special right now that gives you a free DVR + HD, including your high-speed internet for 6 months for 79.99?
    Me: No, that sounds interesting though. I’m also interested in some complimentary HBO.
    Rep: I’m not seeing any current promotions for that, sorry.
    Me: We’ve been loyal customers to Comcast for over 15 years…
    Rep: hmmm, let me run some things…ah! yes it looks like you’re eligible for 6 months of HBO for free. How does that sound?
    Me: Perfect.

    So, over the next 6 months, this will save my parents $35 per month ($210 total) off their normal bill, plus the free upgrades. After that period, they will still be getting HD + DVR service for no more than they’re paying now. All that AND HBO!

  31. Jack

    WEEK 3 RESULTS

    Great post, it’s so hard for me to negotiate on things because I always felt that I’m being cheap and I hate being called cheap or more so greedy. But this is the year of the hustle so I have to break the wall and do this. Here’s what I did just a couple of minutes ago, its not great, but it’s a start.

    I picked up 2 things: 1) ATT wireless bill 2) Chase credit card

    1) ATT (I called the cancellation department)
    Rep: Hello sir my name is so and so
    Me: Hi there so and so, how are you tonight?
    Rep: I am good sir, thanks for asking, how can i help you?
    Me: I’ve been reviewing my bill and its costing me $125 per month, i’m getting some offers from other companies like Tmobile and they will really provide me with good savings. I dont want to leave ATT and I am satisfied with the service so I thought I should give you guys a call before I transfer.
    Rep: sir, here’s what we can do, by analyzing your plan, blah blah you can save money

    In the end, she gave me extra minutes and move me from $69.99 plan to 59.99 plan, (ATT sucked punch us and made us pay $30 for iphone plan and $30 unlimted plan) overall its just a measly $10 / month savings x 12 = $120 per year. Not significant at all but I love the feeling that I can do this. Preparing for the big wins takes small courageous steps 🙂

    2) Chase credit card
    Rep: Hello sir my name is so and so
    Me: Hi there so and so, how are you tonight?
    Rep: I am good sir, thanks for asking, how can i help you?
    Me: I’ve been reviewing my bill and the interest rate i’m paying for this credit card blows my mind at 29.9%, i’ve just receive some offers of balance transfer at 0% and I thought I should call you guys first and see if we can work something out so I dont have to close my account.
    Rep: I’m happy you called us sir, I am happy to let you know that your account was considered for an APR decrease by next month.
    Me: That’s great – (this is where i screwed up)
    Me: How much?
    Rep: We will let you know by mail sir, it depends on the bank you will get it by February

    I screwed up on this one, I could have pushed it more but I chickened out and didnt want to feel cheap and someone taking advantage. But its a start 🙂

    That’s my story for the night, I hope to use this everyday at bigger things. I am actually preparing for the salary increase talk, I just got a 4.5% raise for 2010 evaluation couple of weeks back, I’m not too happy about it and wanted to ask for more, however I know that I have to have a solid evidence WHY IM WORTH the extra $$$ and that takes planning and action, I got my plans already and the wheels are turning, its in the works. Taking this short exercise helps me to prepare for the big day, I’m shooting for around mid year evaluation and go for it. However I wanted to ask you Ramit, if my company wont budge let say after I justify my increase with productivity, technical know how etc, I should be ready to jump ship right? or have another company waiting in the wings? what’s the strategy for this?

    thanks again man,
    Cheers
    Jack

  32. Ben D

    @Ross, wow that is awesome. I’m going to pocket that question to a question. In fact I’m going to use that for my upcoming review.

    When I negotiate, I will always ask. It doesn’t hurt and the worse they can do is not give me what I want. Last year I went to Vegas for a week and a half on the company dime. I asked my manager if I could attend for x business reasons. Manager said they can’t allocate funds for it since the funds were already allocated to other employees. At that point I was disappointed but I took that no and went to my project/program leads and they told me they would look into it. A few days later they told me looks like you are going since they were able to secure a round of funds to pay for conferences like these. They even said while you are at it go ahead and sign up for the courses you wanted to take as well. The conference plus courses plus hotel plus travel was well over $10k. I even got my labor paid for as well. Can’t beat free travel.

  33. Jordan Kohl

    I just want to quote Ross again because it’s brilliant:
    “What salary range have you allocated for hiring someone for this position?”

    I just landed myself a $10k raise, one day a week of working from home, and 3 hours/week of paid education. If I had seen this blog post by Ramit before I started I might have gotten even better gains. But I’ll save these techniques for my next bump in a few months.

  34. jim shields

    So how important is the “get it done by wednesday” part? I have my annual review scheduled for a week from today, and my boss already had to re-schedule it from this week to next week, so trying to push it back to this week is out of the question (and leaves me no time to prepare)

    This week actually marks the end of my 3rd year/start of my 4th year at my job. I got a tiny money’s-tight-but-we-appreciate-you-and-your-work raise (I believe it was 2%) after my 1st year (working for a non-profit during a recession can be interesting), but nothing since then.

    I think it’s time to ask for a real raise. The meeting will be a great opportunity to put what Ramit’s been teaching us about to work.

    As the video producer/photographer for my organization, I have a big library of work I’ve done over the past year that I can point to. I think I’ll be taking an iPad into the meeting with a compilation of the work I’ve done to refresh my boss’s memory of how valuable I am and how much impact my work has.

    I’m thinking that asking for a 15% raise is a good place to start. I already have flexible hours and work from home occasionally (sometimes I have to shoot at weird hours, and my boss is great about letting me take than time back during the workday), so those aren’t really on the table.

    So I’ve got a potential BIG win coming up, but I can’t meet the Wednesday deadline. Having some extra time to pull together my work will definitely help, though.

    • jim shields

      Update:
      Well, my boss got sick last week, so once again my review got re-scheduled; I finally had it this morning. It went really well. My boss had great things to say about my performance, to the point that he made all the points I was going to make in my favor for me! I brought up the raise (and the fact that I hadn’t had one in a couple of years), and basically everyone’s salaries are being reviewed right now, and raises will happen in March.

      So like others have said in this post, getting a raise is a process, and I’ve gotten that ball rolling. I’m thinking I’m in a really good position right now; they’ll be coming to me with a number first, so I’ll have the leverage to counter-offer and/or negotiate for non-salary perks (extra time off, more work from home days, maybe fast-track equipment purchases that didn’t happen last year…)

      All in all, I feel really good after the meeting, and I’m excited about what’s to come!

  35. Erin

    When I first started my current job I negotiated for a small bump in pay for what they were offering. It was important to me psychologically to take that step. I tried to think, “What would you tell a friend to do/say” and I did just that. I hadn’t become a IWT reader yet, but I did read Penelope Trunk’s career advice. In fact, I took a chance and e-mailed her about negotiating, and she gave me great advice!

    While I didn’t get some miraculous increase in my offer, I DID gain the respect of the HR department and the man who hired me. The HR person actually told me that not many women negotiate their salaries, and she wished she had when she was younger. My boss respected me a ton, and 6 months later I got a 5% raise. More recently I got a 13% raise, without asking.

    Another way I gained points was writing my boss a handwritten thank you note after our interview. He hung it on his wall, and said in 30 years he’d never received a handwritten note after an interview. Obviously this is a technique that you use sparingly–not everyone appreciates a handwritten note. You have to know your audience!

  36. A.D.

    Background: Currently job shopping to get better experience and a role that has better potential to get international assignment. With that, I’m an engineer deciding to jump industries from food to energy/chemicals. I’ve been hustling by working my contacts and networks for meetings and recommendations in addition to looking for openings on company websites.

    Results:

    – Being called by HR/Recruiter at a chemical company and not giving up my current salary position when directly asked (it was the second question asked… blunt).

    – I know that the range of salary for the position is easily 20% higher than my current, and giving away my current position would have led to an offer at a measly 5-7% increase.

    – Still in the interview process.

    Details:

    What a timely post…I remember reading an earlier post from you on salary negotiation and I was called by an HR/Recruiter from a company I am interested in working for (1/24/11). The call went like this:

    HR: Hi this is calling about the position you applied for with X Chemical Company. Is this a good time to talk?

    Me: (Caught off guard) Hi, so nice to hear from you, give me a minute to get to a quiet place, I’m at work right now…. Ok sure I’m ready to chat.

    HR: Well, we got your application and I wanted to take a few minutes to ask you some questions before we send your information to the hiring manager.

    Me: Sure not a problem, I’ll let you lead the way.

    HR: Ok great, first, it looks like you have a great position at your current company, what makes you want to leave?

    Me: Thanks and you’re right, this position is great, but at the end of the day, I’m a chemical engineer and want to do actual chemical engineering versus the current work I do, which is more closely related to mechanical engineering. Although I’ve picked up some great experiences and benefited the company I work for, my desire is to work in energy and chemicals.

    HR: Sure, that’s completely understandable. This seems like a good position to help transition you to a more technical role in chemical engineering. So, second question, how much does your current company pay you?

    Me: (having an “oh sh*t” moment, and then flashing back to Ramit and Susan’s video from posting last year). Uh… Uh… is this something you are requiring me to answer as a part of the process?

    HR: Well, we want to make sure your salary matches what we are able to offer you, to make sure it is worthwhile for both of us.

    Me: (Trying as hard as I can to remember Susan and lift her dialogue) Uh … uh well, I do not really feel comfortable answering that, but maybe you can tell me more about this position and when we decide that X Chemical Company likes what I have to offer, and I understand the expectations, we can come to an agreeable number for what people in my field make.

    HR: Oh, well, I’m sure that won’t be a problem, I’m just trying to understand a range you’re in.

    Me: I do not feel comfortable discussing that information at this point.

    HR: Oh, okay, well, last question is about the timeline…

    I was sweating bullets because I was not prepared and caught completely off guard. As far as negotiation, I know what I didn’t give up, but don’t know the upside potential on this yet. When they give me a second round, I’ll hopefully find out!

  37. sambista77

    As an Israeli, the first time we negotiate, is with our mother for her breast milk.
    I consider myself a very GOOD negotiator.
    I can, and have, negotiated BIG things
    (flight ticket, Safra bank exchanging rates, the list is long)
    in lingos I don’t even speak.

    I looked for things to negotiate about but it looks like Things are under control,
    I found a $3 charge from my bank, but nothing more.

    I’ll be honest and say that this is actually not a good sign;
    I think it suggests that I live a very small life, and I do.

    I saved some cash to start my entrepreneurial internet based business and after 4 month I’m short on results to show (read: I’m home, and fear paralyzed).
    To say I’m challenged, would be an understatement.

    Dying to play a bigger game,
    I participate in this course as if my life depends on it, so I’m leaving a comment.

    “Successful negotiators have formed the habit of doing those things unsuccessful negotiators dislike doing, and will not do”. Dr. Jim Hennig

  38. JM

    I work as a freelance DJ and I knew that I’ve been undercharging for the weddings BIG TIME. Since I mostly did events for friends or friends of friends I didn’t want to feel “sleezy” by charging a higher rate and “effect the friendship.”

    I had a transformation in my thinking from a couple of sources, such as reading this website, the Earn 1K free material, and talking to people who knew about my DJ-ing ability.

    The game going on that I didn’t even see was that I am pretty damn good as a DJ and could charge double or triple what I had been charging and customers probably wouldn’t even blink.

    Fortune had it that I had two great testing opportunities with my rates within weeks of each other. With the first prospect, which I got through a referral, I quote them about double what I normally charge plus travel expenses. They agreed promptly and even paid a deposit of 1/3 the total cost the next week.

    I received a another email a few weeks later, another referral, while I was sitting with my roommate and I joked that I should see if doubling my rates would work on this job. I left the email alone for a few hours and then sent a short reply, telling them that I was available for that date, my rates (which I doubled) and that I was glad to hear that our mutual friend suggested me. They emailed me back within 48 hours and said that that was acceptable and to call them next week to go over details.

  39. Work and Life Advice – 1.25.11

    […] A lot of things are negotiable. […]

  40. mariana

    im lost.
    completely lost!
    i joined yesterday… i congratulate everyone for their shared experiences… but…im not sure if there are steps i should follow… if i need to do sth or just read posts…
    SOS!
    on a previous comment i said i keep getting info about week three…so i guess i dont need to go through 1 and 2???

    thanks for the help

  41. Nat

    I just made a $1000 by writing a 5 minute letter to get my home refi fee waived! The bank said no at first over the phone but once I wrote the letter request they waived it!

  42. K00kyKelly

    What strikes me here is how so many of the comments are about how it is time to ask their boss for a raise. The thing is asking for a raise is just opening the conversation. It puts your boss on alert that you want a raise. You’re not actually going to get a raise the first time you ask. There are a million reasons for this – they have to budget the raise in, delaying it is standard practice, they have to play the game with HR, everyone wants a raise, and so on. Don’t think you failed just because your didn’t get what you wanted right away.

  43. Michael H

    WEEK 3 RESULTS

    TEST 1
    My goal was to lower one of my credit card APR’s. I don’t carry a balance on my card so the rate doesn’t affect me, but I’ve always been uneasy negotiating and the purpose was to practice and get me out of my comfort zone.

    Lady: Hi my name is so and so …(insert standard credit card operator greeting)
    Me: Hi so and so, I was calling today to discuss lowering my APR on my credit card
    Lady: Okay, let me look into your account. It looks like we can lower it to 14.24% which is the lowest available for your account. Would you like me to make this change for your next billing statement?
    Me: Yeah, uh, I guess if that’s the lowest you can do, sure.
    Lady: I’ve done that and thank you sir for calling.

    ** What I learned **
    1. I wrote out an entire script on why I was a good cardmember (never late on payments, always pay in full, etc) and didn’t use them because she offered a lower rate without hesitation. I was expecting a negotiation in the wrong area (why to lower the rate rather than to what rate to lower it to).

    2. I was thrown off guard with how she phrased her response (“I can do this… would you like me to make this change, sir?”). In hindsight, I should have used this opportunity to politely press her on a lower rate instead of being caught with my foot in my mouth. I could have thanked her for offering me a better rate and countered by stating I’ve received better offers through other companies and ask her what we could do to make our APR more competitive, etc.

    TEST 2

    Initially I planned for one phone call but after my results from the previous experiment I was excited to test out what I’ve learned with another credit card.

    ** Changes I made for next phone call **
    1. Set a goal APR. 19.24% -> 14.24%
    2. Adjusted my scripts to account for positive responses in addition to negative responses

    Gentleman: Thank your calling, I’m so and so, how can I help you?
    Me: Hi so and so, I was calling today to discuss lowering my APR on my credit card
    Gentleman: Okay, I’ll look into your account… it doesn’t look like you’re eligible for a rate decrease, I’m sorry for the inconvenience.
    Me: May I ask why I’m not eligible? I’ve been a cardmember in good standing for 10 years.
    Gentleman: I actually cannot help you with this, would you mind waiting while I transfer you to a senior account manager?
    Me: Sure
    Manager: Hi sir, I’ve heard that you wanted to decrease your APR. I’ve looked into your account and unfortunately I can’t lower your rate and it’s by no fault of your own.
    Me: I don’t understand- (he cuts me off)
    Manager: It really is no fault to you. We’ve been reigning back lending as well as decreasing credit limits across the board. I encourage you to call back within two to three months to request again.
    Me: Well, I will, but I am planning a honeymoon in Europe soon and I was hoping to use this card with a more competitive APR. What options would we have to work with the APR in the near future?
    Manager: I really don’t know at this point in time.
    Me: Okay, well thank you for the time. I will followup in the future.

    I failed on test 2, but I can’t even quantify the value of what I had learned on these phone calls. I was less nervous on my second call, began to learn how to manage the way operators redirect their answers and laser my focus of what I’m looking for in my pitch. I have tons more to learn, but this has been a great lesson.

    What I’ve learned is lightyears ahead of reading material and not taking action. Thanks Ramit!

  44. David

    Great post on negotiations.

    I emailed you a while back about how I got owned in a negotiation when selling my junk car. I didn’t lose much from my original price, but I felt the psychological smackdown during and afterwards. The guy started small, and kept getting bigger, and then nickeled and dime…the guy was a mechanic and had all the leverage. He knew how to negotiate. I fell for every trick in the book.

    The three key lessons I learned were: 1. Be ready to walk away, 2. Have a final cut-off price to walk away from, and 3. be aware of some of the persuasion techniques

    To improve myself, I started selling things on Craigslist and asking for deals everywhere I would go (cameras, music, eye glasses, sandals…). I just wanted practice. I even bought things to negotiate (got a Wii for 125$ for my gf’s birthday…brand new, unopened 🙂 )

    All of this has been for the big negotiation I plan on having in the July/August time frame with my job.

    I have determined I am underpaid after discussions I’ve had with people I know in other companies in the same industry, and internally in similar positions. I did not negotiate my salary coming in straight after college (I asked to, they said no, I took it like a powderpuff since I thought I had no leverage). That’s the past. Technically, though, I was one of the higher paid ones due to the city, major, and school I came from. I know people who did worse, but regardless…I am not satisfied.

    Currently, I am building up my leverage in preperation for this negotiation. Here are the steps I am taking:

    1. Make it so everyone who has managed me knows I’m a rock star. (DONE) I will ask the person I’m negotiating with to go and ask these people about me. They will all vouch for my ability. I outperform people a level above me. The good news is this guy has already heard about me and tried to pull me onto a project already.
    2. Solidify my promotion for this year (DONE). I am a functioning at a level higher than mine and leading a team. I am outperforming many people at the level above me. No arguments there. I will be promoted in that late Q3 timeframe.
    3. Build up my skill sets (in progress) by becoming certified in specific areas in my field. I am taking tons of training courses to become certificated. I’ve been in the field for several years, but have no certifications. They don’t mean much internally, but externally…they are key and raise my value significantly. They will also give me leverage in future job interviews anyway, so it’s a win-win.
    4. Receive job offers from competing firms (In progress). I already interviewed with one firm. I’m having a follow-up in June with a timeframe I wanted that will time perfectly with my negotations in August. I plan on having minimum one legitimate offer to a job that I would not be afraid of falling back on in case there is a negotiation break down (basically, I’m not bluffing). Mentally, I will be ready to stay and go. As a side note, I used the standard script from Ramit’s book on how to answer “what is your expected salary?” I responded, “Well, I currently don’t have enough insight into what specifically I would be doing in this role, so I don’t think it’d be fair to either party to discuss that topic without having a clearer view of my roles and responsibilities.” The HR rep had absolutely no retort. Awesome 😀

    My plan is to get a raise prior to promotion (in early Q3 when the offer from the competing firm arrives, assuming I get it), then get the huge raise that comes with promotion (assuming I get it, which I am very confident in). I have a number in mind that should be met post-promotion. I know a rough number I’ll get at the competing firm. I’m going to argue for the raise initially due to my skillset and certifications, delivery prowess, reputation (as provided by other feedback and reviews), and proven consistency and success to be above my peers (I’ve been ranked at the top regularly now).

    I’ll see what I can get from that. If they hold back, I pull out the next card and mention that a competing company has offered me a job. My company is not in an ideal position to lose people now…so that’ll be a good one to play. My company will want to keep me because currently they have so much demand for work, they are having issues hiring people. They NEED more people. Losing a high performer who knows the culture and has the internal network would be costly.

    My overall goal is to obtain a counter offer, and, if necessary, walk away.

    Thanks for the excellent framework. As they say, prior preparation prevents piss poor performance…

  45. Susie

    Dear Ramit,

    Rundown: I utilized a major lesson from your Negotiation 101 Intro video today and will be saving $3,800.00 over the next 12 months — with little to no change in lifestyle.

    The lesson: When recruiters — or in this case, sales reps try to force you to name what you are currently paying — never reveal it! This is their magic bullet against you. Take Ramit’s advice and never negotiate against yourself by revealing it. Yes, it may be very tough not to reveal — but you can do it!

    I was challenged about six or seven times to reveal what I am currently paying for health insurance, the rep even became noticeably angry to see if I would budge, saying that he “MUST know it to get me a rate;” I must say that if I hadn’t heard from Ramit not to reveal it, I likely would have, thinking the rep was right. All the while I wanted to laugh and I was just dancing on the inside knowing that this was just the game to be played before I became the one in charge — calmly and firmly negotiating my way to huge savings!

    The storage savings was earned simply by shopping another location, reporting the savings to my current storage manager and letting her know that I’d like a similar rate. I was able to get a much lower rate with a slightly smaller storage simply by being nice, yet firm. As Ramit always says, be prepared with the facts to maintain a strong argument.

    Summary: I will save $2,612 with the new health insurance and $1,188.00 for storage costs, totalling a $3,800.00 savings over the next 12 months!!! I am ordering your book for my son and myself!

    Ramit, you Rock!

  46. Jen

    Week 3 results: $250 gained on my old laptop, savings on a new one, and a major headache avoided – all thanks to negotiation!

    This isn’t big bucks, but it’s a HUGE win for me. I was selling my old laptop and rather than name a price I let the buyer name a price for me. They were way more spendy than I expected and I came back to their original price with a description of the laptop’s added extras (AppleCare ain’t cheap), again not mentioning a specific price, and they named a figure that was $250 more than I had expected to sell it for.

    I then went shopping for a new laptop and the store clerk was trying to hard sell me, I attempted a couple of negotiation tactics mostly asking about any types of discounts they might have. I think what’s interesting here is I was shopping in a university town (Palo Alto) and wearing student-y clothes so I was offered a student discount straight away, without having to prove my ID. I walked away and the clerk gave me his name and told me I could get an additional saving next time I came back if I asked for him. Nice!

    Finally, the super massive bonus that makes it all way worth it – the laptop buyer saw a tweet I had sent about Burning Man, and because SHE thought she had gotten a great deal on the laptop, she offered me all her BM supplies as she isn’t going this year. For free! Now I don’t have to shop around for a tent, awning, water containers, etc, etc – it’s all just going to be packed and ready for me. To me, the saving in time and money from that alone is worth well over $1000.

    Way to go Ramit!

  47. Lou

    WEEK 3 RESULTS
    Steps:
    1: Read the post, drove to the book store and purchased your book. Skipped and read Negotiation sections on cars dealers – stopped not to exceed my 30 minute limit.
    2. Decided to sell something on CL. Found a Juicer that I am not using. Researched the going price on CL and Ebay. Set my minimum price writing this on a sticky note and hanging on my monitor. FYI $100
    3. Research and post. About 15 min reading on the web site of the juicer manufacture so that I could post an interesting ad listing the health benefits and features of the Champion Juicer.
    4. Take the calls.
    – skipping some details. Me: yes, I have the juicer and am open to negotiation. I will tell you I have had a lot of interest in this post. Caller ” could you hold it for me and I can pick it up this evening? Me: well I really would prefer to sell it to the first person meeting my price and having cash. Caller: how about I send you the money paypal and pay you the full asking price. Me, Done.

    Not a million dollar deal but the lesson was that by including some details in the post and by creating a since of urgency I made more than my original target. By the way they sell anywhere from 8$0 to the now high of $125.

    I have other projects in the works but this was one I could finish by tonight’s dead line.

    Results – sold a Juicer I was not using – put $125 into my savings account / learned that with continued practice and some preparation I can alter the outcome.

  48. SBE

    WEEK 3 RESULTS

    About a year ago, I began negotiating to get transferred within my company to our Amsterdam office. A few months ago, as everything began to come together, I negotiated to have the immigration and tax consultancy paid for by the company. This saved me about $20,000 in moving costs. At this point, though, I decided that I was not willing to “rock the boat” and negotiate a larger raise around performance appraisal time.

    Well, the post changed my mind. I spoke to my boss and didn’t plan to actually start negotiating, but it was like he was already prepared for my call. He “pulled up a spreadsheet of everyone’s salaries” and told me where I fell in that range. He actually offered to bump my salary up $10,000 without me having to ask. Sounds good to me!

    Given how easy that was, I’m going to take the next year to compile data on market rates, competitor pay, etc., and accelerate my win by going for $20,000. And by that point, I’ll be able to tout my global management experience (which they paid for).

  49. SBE

    @Ross – I can’t wait to use that!

    @Laura Roeder – I’m calling AMEX today because I’ve tried to (unsuccessfully) negotiate that fee myself

  50. Sheri

    A couple of weeks ago, my dishwasher broke and flooded my kitchen. I’d usually just have the thing repaired, but it’s been a piece of junk since we moved in and I just wanted to get rid of it. It turns out that the counters in my building are too short for a standard dishwasher – limiting me to about three different models (all listed at over $1000!). I like supporting local businesses rather than just going to big box stores with cheaper prices, which makes negotiating much more personal and scary. Yesterday, I put the negotiating scripts to the test at our local appliance store …

    First, I defined what I wanted ahead of time.
    1. They had to handle the delivery and hook-up appointments with the plumber
    2. I didn’t want to miss work for the delivery (their standard delivery days were Tuesdays and Thursdays)
    3. I wanted the lowest list price that I had found when I shopped around
    4. I was willing to walk away if I didn’t get what I wanted

    Second, I thought out my strategy ahead of time
    1. I went in right before they closed (if they had a bad day, they’d be more willing to haggle)
    2. I was friendly and not confrontational – all good-cop without a bad-cop
    3. I let them tell me their best price first (before I said what I was willing to pay)
    4. I started with a lower price than what I would take.

    I ended up saving $250 off of the dishwasher and they are handling setting up the delivery and hook-up on one of my telecommute days — so I won’t have to miss work or take the time to schedule the appointment with the plumber myself. Oh, and they are throwing in the hook-up kit, which usually runs around $50. Total savings: $300 + the $/hour of my time finding a plumber and scheduling an appointment (priceless).

    What I learned and can improve:
    – They came down to my price too easily, so I started too low.
    – It’s okay to ask for what you want and to accept it when you get it.
    – You can be tough without being a jerk.

    In the next couple of weeks I’ll be asking for a promotion at work, so I’ll be practicing and refining these techniques and scripts.

    • Sheri

      Oh, I forgot to mention that I also followed Ramit’s advice and DIDN’T get the extended warranty because I get it free as a benefit for by using my credit card.

  51. Léan Ní Chuilleanáin

    WEEK 3 RESULTS

    Earlier today I rang my credit card company and negotiated a 6-month APR reduction on my balance.

    Yup, I’ve carried a balance for the last 18 months, since our home extension ran over budget. I hate it, but as my income is tiny and irregular (working on that!), I’m stuck with it for the time being. (Plus, now I’ve admitted it and incurred the Wrath of Ramit. OH WELL.)

    Far from being “bred” to negotiate, I’ve never done anything remotely like this before. So before I even lifted the phone, I had to set aside the negative script “negotiation is for other people”.

    Week 1 of your hustling material helped with that, thank you very much 🙂

    So. I used the script from your book extract on this page, reciting several phrases pretty much word for word. It worked beautifully.

    As soon as I said “I’d like a lower APR”, I got passed on to another department.

    The rep first of all suggested that I transfer to a card with a lower APR than the one I have.

    Now, I knew I was in a weak position here, because my income is so small that actually getting approved for a credit card would be tricky at the moment.

    But I reminded myself that the rep didn’t know that, and then I reminded him that there were several cards that offered a 0% balance transfer. Did he have one of those he could switch me to?

    No, he said (as I knew he would because I’d asked about it last year). All he could offer was, again, for me to apply for the lower-APR card.

    “Well,” I said, “I’ve been a customer for more than 10 years, and I’d prefer not to switch my balance over to a low-interest card unless I have to. So, can you match your competitors’ rates?”

    He went away to “see if he could do anything for me”. Came back with an offer of 4.9% APR for six months on my current balance, to help me pay it off more quickly.

    This is a reduction on the order of 70%.

    Yes, it’s only for six months, but I wasn’t joking about aggressively addressing this debt – I should have it squared away by then, or almost. And as soon as I can, I’m going back to my previous long-established habit of paying the balance in full every month.

    I never paid a penny in interest to Visa before 2009, and as soon as this is over, I don’t intend to pay them another penny again.

    Once the adrenaline rush wore off, I felt pretty good 🙂 Thanks, Ramit!

  52. TheCosmonaut

    WEEK 3 RESULTS
    OK, so I started with an easy one: Cable. We’ve got the full package with Comcast and our “honeymoon” period wore off a while ago. So basically we’re paying $220/mo for TV and internet access. If you deduct internet ($60/mo), we’re paying $160/mo.

    I researched what Dish and Direct TV are offering for comparable packages. With those numbers in mind, I called Comcast. I navigated their phone system to get to the “downgrade/cancel” department. Then I hit “0” until I got a representative.

    Here’s the script:
    ME: Hi! I’m a current customer with the full HD cable package. Right now Dish and DirectTV were offering really good deals. I’d really like to stay with Comcast, but with these deals, it’s tough to do so. Is there any way you can help me out?
    Comcast: I can definitely help you with that. [double checks my info, puts me on hold for about a minute]
    Comcast: I can offer you a $50 per month discount on your existing service [this is $10 more than I was hoping to get].
    Me: And just to confirm, that’s not changing our service at all, correct?
    Comcast: Correct.
    Me: Done.

    Our monthly cost right now is cheaper than Dish’s promotion and on par with DirectTV’s, and we don’t need to go through the hassle of switching. Total time, about 5 minutes. Total savings over two years: $1200.

    I “knew” that Comcast would do this months ago. However, I procrastinated on making the call, telling myself it would take too long, be a hassle, etc. It took the gauntlet getting tossed down to get off my ass and get it done.

    So here’s what I learned:
    — Companies like Comcast expect and are prepared for this. It’s cheaper for them to give me a discount and keep me as a customer than to try to get a new one. That means it’s really easy to get the savings, and I probably could have negotiated for more.
    — The negotiations weren’t the uncomfortable or time-sucking boogeyman that I feared they’d be.

    Good reinforcement to get off my ass and do it. I’m examining some of the other areas where I might be able to find some small savings: credit cards and banks are next on my list.

    Rock ON.

  53. eleni

    Great post.

    Can’t wait for Friday’s material!

  54. Maxime

    Hi Ramit,

    So far, I put the idea in my boss’ head that he should start a company that I’ll run. He brings the money and I’ll manage the stuff.
    I don’t know yet where this will bring me but he was pretty receptive.
    He also begins to consider buying what I wanted to sell in 2011. Maybe my 2011 goal will be finish by June if I can keep him going.

    Next things to do and/or still pending :
    – Wait for the answer from my bank to remove my credit card fee (I call too late, sorry Ramit)
    – Restart the negotiation with AmEx for a card where I’m below the minimums.
    – Negotiate with my boss for him to pay me Earn1K 2.0 and a trip in Cameroon. Ask him to become a freelancer and still work with him because I love what I do but I hate where I have to do it.

    I still have a lot of things to do by the end of the week but I’ll the most of it in the next 2 days.

    Thanks Ramit

  55. Alyssa

    WEEK 3 RESULTS

    Negotiation: car insurance

    Step 1: shopped around and found out I’m getting the best deal.

    Step 2: called up my insurance company and asked several questions including “Some insurance companies offer discounts for low-risk occupations. What kind of competitive rates do you offer?”
    “What kind of low-mileage discounts do you offer?”
    “Can I save money by pre-paying my entire year up front?”
    “How long have I been a member with you? What can you offer me as a discount for long-term membership?”
    “I’ve had a change in education status I would like to update. Do you offer any discounts for Masters degrees?”

    Step 3: My car insurance monthly payment went from $107/month, then down to $89.77/month and finally down to $67.00/month!!!

    Shhhhhhweeeeeeeeet!!! Thank you Ramit for your continued guidance and harassment 😉

  56. Justin

    WEEK 3 RESULTS

    Ramit –
    Using tactics from your blog, earn1k, and hustling, I’ve been developing my own service-business of teaching social dance lessons and dance party at a dance studio. I’ve essentially identified what program/dance opportunities were lacking in this town, and cornered the market, creating the best buy-for-your-buck event that no other social dancing event comes close to competing with.

    I’ve signed with this dance studio to rent their space for 3 hours on the weekends to host the dance, and I’ve been making a 30% commission on all of the guests that attend. Well, after some great marketing (based on your techniques for target markets and funnels), this event has really exploded, and I’m now making an extra $500 a month on the side with one of my hobbies (I love it!). Anyway, I wanted to renegotiate for a higher commission because I’ve started pulling in a lot more money for the studio now.

    I did my research, and figured out that on a per-hour basis, and considering the hours I was selecting for my dance (hours that no other instructors at the studio wanted to rent/use and pay the studio), I figured out that I was already making the studio more than double-per-hour what it was making during some of it’s primetime weekday hours. So today I met with the studio owner for lunch and had a chat:

    Me: So, I’ve calculated out the figures now, based on the past 3 months, and I can see this operation is doing very well for the both of us.
    Owner: I know, this is getting really exciting, congratulations!
    Me: Thanks, it’s been a lot of work, but it’s been fun. I actually wanted to talk to you about the work for just a moment.
    Owner: Sure, go ahead.
    Me: I’ve found that the effort it takes to market for this event, and even prepare, is a little more time-costly than I first anticipated, especially now given the incredible turnout we are getting from me marketing to x, y, and z.
    Owner: I understand.
    Me: So, I’d like to renegotiate for a higher commission on this event, to better compensate for my time.
    Owner: Hmmm, what did you have in mind? (His look immediately changed to less than excited…)
    Me: Well, as you can see from my notes here, on a per hour basis of actual time-used at the studio, you’re making X per hour that I am working there, and this is on average 110% more than the studio makes for those same hours on any other day of the week, except Wednesdays.
    Owner: Wow, really?
    Me: I’d also like to point out that you reserved me this time because no other dance instructors were willing to use it. Given that, I think it would be fair for me to receive upwards of 60% commission on the nights event, with the anticipation that the event will grow even more.
    Owner: That seems like a lot for just one event. Do you really think that is fair?
    Me: Well, again from the notes, you see clear growth in the number of people attending each week, and my marketing efforts are getting better-and-better. I feel like my time to run this event is becoming more valuable.
    Owner: I understand that, but your asking for a lot more.
    – And this is where I nailed it –
    Me: Well, I’ve also been wondering if some of the other local dance studios couldn’t benefit from this event instead. The clients showing up have really taken a liking to me, and could very well follow me for my event elsewhere. I’ve been asking studio y, z…
    Owner: Hold it! I get what your saying, I don’t want to lose out on you and this event… *short pause* What if I increased your commission to 50%, and if the growth continues as well as it has for the next 2 months, we can discuss bringing you up to 60%, or other compensation.
    Me: That would be more than acceptable, thank you!

    Just like that! Taking my “boss” out to lunch for $20.00, crunching some #’s for an hour based on the studio’s and my event’s intake, and I go from $500 a month on the side to $850! So close to my $1,000 a month goal! And as this event grows even more, I know I’m going to nail it in no time!

    Thank you Ramit!

  57. Ameena

    Prior to reading this, I’d already endured days of price comparisons on a new car and I’d been haggling it out with a shady salesman for about 6 days. I was about to do just do the deal so I didn’t have to think about it anymore…but then two little voices started up in my head – yours and my Indian dad’s and I realized that I could definitely do better by haggling the Indian way.

    So I sat back down and called around some more. After another hour I’d negotiated a better lease on the exact same car for $10 less a month. Best of all? The new salesman wasn’t a shifty/shady guy.

    “Sometimes it’s not just about the cost,” right?

    They are delivering my new A5 today on a flatbed truck. Thanks for the very timely post and resulting motivation!

  58. Biren Shah

    I took action this week, and I’m going to be getting $1500 worth of usability testing and use of a conference room for free.

    While not exactly one of the targets you listed–it wasn’t a direct sale negotiation, it turned out great for me. I’m working on a web project, and one of the biggest factors for success (according to a lot of people) is to do usability tests, early and often. Problem is, they often cost $300 / per person to do a test + facilities (I work from home).

    Instead, I joined a usability meetup. Instead of dicking around trying to “establish myself” on the group, I posted my first idea for a meetup after being in the group for 2 minutes. Now, I’m going to get to test out my designs on 5 people for free. Plus someone offered up their conference room, and they’re all people who have already expressed interest in developing highly effective software products (good networking).

    With any luck, we’ll be able to turn this into a biweekly or monthly event, and I’ll save over $10,000 over the course of this project.

  59. Alfonso

    Well, two things… one this week and the other last month.

    December 2010: I want to buy a Macbook Air (320€ in savings)
    First, I checked which way it would be cheaper. I live in Spain and sometimes buying things in USA is cheaper… if you have someone to bring it over back home! In this case, I made my calculations and it wasn’t worth it. So I decided to buy it in Spain.
    Sticker price? 1849€ with all the characteristics I wanted.
    However, instead of going to the Apple Store, I called the store that is next to my house in Madrid. And voila, instead of giving me the sticker price they told me it was 1750€!
    Then I called the Apple Store per se, the ones that sell you the computers via phone, not related to the physical apple stores. At first they gave me the sticker price but I said that the physical store was giving me a discount and they said… 1637€! I felt it in my bones that they could go even lower. So i waited… for Black Friday. Black friday price was higher than the price I already got but i knew that day they would probably be more willing to lower the price.
    So I called the phone line again and asked to speak with the same person that offered me the 1637€. She remembered me (I really don’t know why…;) and I told her that I really wanted that one but If I couldn’t afford more than 1500 and I would buy an Ipad instead…
    What happened? She went to talk to someone (she said it was her manager to get permission, but who knows) and told me she was going to give me the highest discount they could and gave me the price of 1530€. That was more than 320€ less!
    I finally bought it and I’m very happy with my Air

    This week- ING Direct friend referral policy
    I have two friends that want to open an account in ING Direct and I intended to use the friend referral tool, in which they give me and them 50€ each. However, it seems that this offer is not online right now in Spain so I called them yesterday to ask for getting signed up to it.
    I talked with the agent who told me repeatedly that there was nothing I could do but managed for her to tell me with who I should speak and how. In the end, she sent a message to the person that I needed to talk and everything and told me that, if by next monday they haven’t answered I should call again. So I might win 100€ this month and my friends 50€ each! Now that is what I call friendship.

    Thank you all!

  60. Sanjay

    WEEK 3 RESULTS

    Goal 1: Obtain free internet access at my hotel (small goal)

    Script

    Me: Hello, I would like to know what you can do to provide me with complementary internet access

    Manager: I’m sorry we do not provide complementary access and we charge everyone $12.95 per day, that is our policy.

    Me: I am on business and require internet access. The Hilton across the river has given me complementary internet access when I stayed with them for two weeks.

    Manager: Okay, what’s your room number.

    Me: (I provided my room number)

    Manager: Unfortunately, there is nothing I can do.

    Me: I am staying here for fourteen nights, what can you do to give me complementary internet access?

    Manager: Like I said, my hands are tied and I cannot do anything.

    Me: Okay, thanks for looking. (I walk back to my room, research who provides complementary internet access, grab my empty suit case, and talk to the same manager again)

    Manager: (manager is greeting guests in the lobby and approaches me) Is there something I can do for you?

    Me: Yes, I was talking to you a little bit ago, and wanted you to see what you can do to give me complementary internet access, as I am staying here for fourteen nights and it would make my stay much productive.

    Manager: Sir, as I previously stated, there is nothing I can do.

    Me: I would like to stay here because of the location and amenities, but the Marriott down the street, provides similar amenities as your hotel with complementary internet access.

    Manager: Let me see what else I can do, wait here one minute. (Manager walks behind the front desk, researches on the computer) Okay, it looks like I am able to give you complementary internet access. (manager hands me a card with that has a code on the “promotion code” line).

    Me: Thank you.

    Manager: You’re welcome, thank you for your business.

    Result: $ 181.30 worth of free internet access.

    • Ramit Sethi

      LOVE THIS

  61. Chris M.

    WEEK 3 RESULTS

    This week, I was able to take action and get myself a significant raise at work. It’s currently annual review time, so the timing was right on.

    When I started this job last year, I agreed to a lower salary due to a lack of professional experience. I told them I was confident I’d exceed their expectations. I reminded my boss of this during our review, and had already completed my self-evaluation with details of how much revenue I had brought in for the company in the past 3 months. I also pointed out that I would have been promoted had I stayed at my previous employer. I asked for $115k, hoping to get to $105k (I made $92k last year).

    The Results: I got a promotion to Senior Software Engineer (I’m only 28), with a raise to $108k and a commitment from my boss to have a mid-year review with a target raise of 7% (taking me to approximately $115k) and a planned path to promotion to Staff Engineer with a corresponding raise in 2012. My boss said that he was glad we talked instead of me just leaving, and that there’s always a way to keep high-performers happy.

    This effort (which probably took 8 hours of documenting past successes on my self-evaluation) led to an extra $16k this year and plans for even more next year.

    Thanks for the tips!

    -Chris

  62. Joseph C

    I’ve been “courting” the owner of a company I want to do marketing for. This means simply providing value in the form of insights and troubleshooting about his product, over a period of probably a year.

    I wasn’t in any big hurry to get his business, because I had plenty on my plate. But I knew I wanted it long term.

    Finally two days ago he volunteered his Skype contact info after I sent yet another email detailing a specific workaround to the largest bug in the product. I agreed to chat with him. At first I thought he wanted to ask questions about my emails. I kept waiting for some specific questions to come out. But then I realized he just wanted to get to know me and talk about his business.

    So as you can see, the negotiation hasn’t even started yet, and I’m in a position of massive advantage. I’ve proved my worth by providing free value consistently, and have thereby established a relationship. Now he’s approaching me, and I’m letting him lay all his cards on the table.

    And lay all his cards on the table he did!!

    First we chatted about stuff totally unrelated to business for 20 minutes, then finally the conversation reached an awkward point. I was expecting he would finally say something specific about one of my emails.

    Nope!

    Because I’d just been sitting there, not trying to sell him on anything, or pitch any serious business solution, he felt comfortable enough to just disclose everything about where the company was at, and what he wanted to do with it, etc etc.

    You cannot BELIEVE how shocked I was by the stuff I learned in the next few minutes!

    Basically, the entire business was being run by… nobody. (Except for basic order-taking and support.) I could step in right away and take a comprehensive role.

    That told me I should ask for a WAY larger role than I’d initially thought, and that I’d be able to operate with near-complete autonomy. Wow.

    Secondly, he didn’t care about the revenues from the company, beyond paying the bills. He was only interested in developing the product.

    That meant that I would be able to expect a VERY generous cut, if I played my cards right.

    We danced around the area of compensation a bit. He stated that he wanted to pay me, and asked about my rates and such.

    Now, my preferences in this area are unusual. I don’t want to be locked into a fixed arrangement because then I become a wage slave, morally if not legally.

    So I told him I wanted to create measurable results, and then we could agree on a fair split.

    I’m going to WAIT and delay decisions on compensations until I know the gross income and profit margin for the company. Then I expect we’ll split it closer along the lines of a partnership, rather than me being a piecework contractor.

    I’ll also delay definite compensation decisions until I’m already embedded in the business in terms of admin passwords, ownership of Adwords accounts, ongoing tested marketing campaign, etc etc.

    Once I have tested proven revenue models in place, it becomes a simple matter of self interest – give me a fair cut and we’ll both make money when I implement this, zero risk.

    Instead of being a barrier to the relationship before it gets started, compensation will be just one item on our busy todo list of getting rich together.

    So in conclusion, I applied principles of seduction to business negotiation, and came away with a huge win.

    1. First I did the initial approach
    2. I demonstrated high value and built rapport over time, without displaying ANY neediness
    3. Eventually the prospect felt compelled to pursue me, and spilled all his beans
    4. I expressed interest, then lay back and allowed him to continue to chase me
    5. I will avoid “defining the relationship” until all psychological biases point in my favor – sunk cost, inertia, momentum, fairness, etc

    As a result of doing it this way, I turned an opportunity that I expected to be a small freelancing role, into what’s looking like it could possibly be a junior partnership, with no up-front capital requirement from me.

    And I did it all without having to build a pitch, until the client told me exactly what his situation was and what he did and didn’t care about.

  63. Sandy

    Week 3 results

    the price of my cable/internet has been ‘bothering’ me for a long time – but as usual I had done nothing to take action and do something about it. Finally I did:

    Rep: Good morning, how can I help you today?
    me: I am unhappy with the price of my bill and I would like to speak with someone about my options.
    Rep: I cannot do anything to change the cost of your bill at this time.
    me: I am a customer in good standing and I would like to discuss any promotions you have available.
    Rep: nothing at this time.
    Me: thank-you – and I hung up.

    I could not make the initial customer service guy budge.
    So I called back the next day:

    Rep: how can I help you?
    Me: I am unhappy with the price of my bill and I would like to speak to someone about my options?
    Rep: I see that you are a long time customer so I will transfer you to customer relations.
    Me: thank-you.
    Rep2: how can I help you?
    Me: I am unhappy with the price of my bill and I would like to discuss my options for lowering it.
    Rep2: Sure, would you please hold while I see what you are eligible for?
    Me: Sure.
    —hold (aprox 5 min)—
    Rep2: We can offer you an even better deal that what you had before, including a free DVR rental and wireless modem rental for 1 year and 30% off cable and internet.
    Me: That sounds good, what will my price rise to after the one year is over? I am not comfortable paying the increased amount.
    Rep2: Call back next year at this time and we will be happy to offer you a comparable rate that you will be happy with.
    Me: would you make a note on my file about that and email me a confirmation.
    Rep2: yes, certainly.
    Me: thank-you I accept the offer with the note on my file regarding next years price.
    Rep2: Is there anything else I can help you with.
    Me: no, thanks.

    My bill went from $110 per month to $74 per month and I got the upgraded hardware free! Biggest thing I learned was if you dont have success with the first rep, call back.

  64. Kate Ressman

    I wouldn’t have actually done this without your pressure to be accountable this month. I’ve been “planning” and “shoulding” my way around calling my credit card companies since I read your book the first time.

    My heart rate skyrocketed as I picked up the phone. It was irrational and incredibly stupid, but I was utterly terrified. I managed to step back and analyze my reaction. I reframed the adrenaline rush as excitement. The biological reaction is the same, after all. Once I did that, I was able to remain calm and businesslike on the phone.

    I dialed the phone, got myself transfered to the correct person. In less than half an hour, my APR was reduced by 4 % points. I’ve added a note to my calendar to call them again in 6 months to renegotiate.

    So, thanks for the kick in the keister.

  65. zachary

    Week 3 results: $180 savings for my friend with a hour and half of work.

    I had to do something rather than nothing, to get myself more practice taking action.

    So I was really busy (I felt anyway). I thought what can I do, so I decided to help out my friend who is paying a crazy high cable bill for so long and he didn’t even think he could get the price reduced.

    I called his cable company and asked for a price reduction they said no basically did not even offer to transfer me to another department. I had no tools, so I told them I would look for better offers.

    I did that online and found a competing offer for half the cost. So I called back and just followed the script I found this cost at x and i would like my bill 50 percent reduced. I have been a customer for x years ( I found out this info during the first call ). First person told me I had to pay 106 dollars overdue charges, I said yeah I will pay that, but can you reduce my bill today that is what I am calling for. I got transferred to rendition department. Then same script. They tried to sidetrack by upgrading, having to pay the past due of 57 dollars (a different amount!), sticking to the script again. I got the bill slashed for six months for 50 percent about. to 29.99 and then it will go back up but I know I can call again do it again next time I’ll say the competing offer was permanent so they should make it permanent too.

    The time worked; a hour and half, savings 180 bucks to my friend and a lesson for him hopefully he’ll learn something from me! ha!

  66. Jennifer

    Week 3 Results:

    I finally called my credit card company to negotiate the $50 annual fee that I’ve been paying for a few years.

    Script went something like this:

    Me: I see that there’s a $50 annual fee on my account. I would like to get that fee waived.

    Rep: OK, let me check on that….. Unfortunately, I’m not able to do anything about that.

    Me: Well, I see that fee there and I would really like to have it waived. What can you do for me?

    Rep: I’m sorry, but I don’t have the authority to do anything.

    Me: May I speak with someone who does have the authority to do so?

    Rep: Yes, I’ll put you in touch with an account manager right away.

    Acct. Manager: (after exchange of pleasantries, much different tone than the rep) What can I help you with today?

    Me: I’d like to have my annual fee waived.

    She checks and tells me that the system won’t allow her to credit the fee back to me. She apologizes.

    I explain about my other credit card offer with no annual fee, no international trans fee, etc. I live in Greece, so this matters.

    She says she still can’t credit the fee back to me, but how about 4000 free miles on my account? (This just put me in the range for a free ticket!)

    I take the miles.

    She then tells me about other new cards, and that don’t charge int trans fees. If I switch to one of these cards within the next month, the annual fee will be credited to my account.

    This is a big win for me! Thanks so much for the encouragement — and by the way, the image of a timid weirdo was what kept me going during this call, my first real confident attempt at negotiation! Now I’m sure that I will negotiate more important things in the next few months.

    This is fun!

    I then explain that I’ve had other offers

  67. Roberto Lebron

    WEEK 3 RESULTS

    I asked my employer to pick up $2K+ in medical expenses my insurance had not covered. He agreed.

    SCRIPT:

    Me: As you know, I missed some time at work because of my recent illness. I have now received the bill for the expenses that my insurance did not cover. The bill comes to just over $2K. How can you help me with this?

    Employer: Well, one of the ways we keep costs under control is agreeing to high deductibles.

    Me: And since most of our staff is young, you’re betting they won’t get sick and the high deductibles won’t be an issue. I’d do the same thing. Unfortunately, I did get sick, as you know. How can you help me with this?

    Employer: Let me see that bill. (Looks it over) OK, we’ll take care of this.

    Me: Thank you very much.

    Of course, I used a respectful and friendly demeanor. Rather than asking “Can you help me?” I asked “How can you help me?” and he found a way.

  68. Dave

    WEEK 3 RESULTS:

    I called HSBC twice today about reducing the APR on my credit card. Both times they told me I didn’t qualify for an offer. I wrote down the result in my customer service spreadsheet (I last called about reducing my APR about 1.5 years ago) to keep track. However, I’m not letting this deter me. I’ve been researching credit cards online (and through your book, Ramit), and I decided on one from Capital One. Therefore, because HSBC never seems to give me offers, I am going to call Capital One right now to get my “dream card” and reduce the spending limit on my HSBC credit card.

    • K00kyKelly

      Noooooooooooooo. Not Capital One! Did you research their customer service? They’re famous for not increasing credit limits. They’ve been good to me as far as waiving fees and contesting bad charges, but I still have the $500 credit limit from when I opened the card at 16.

    • Natasha

      Agreed, I hate them:
      I got 3 card offers from $1500 to $2500, as a new customer and $5000 pre-approved from Capital One, which THEN TURNED INTO $500 when I applied to it!

      When I called, they said they can get me $700 max. 3 years with them, haven’t missed any payment, they still won’t give me a raise, while Bank of America is already giving me 5000 and CitiBank 9000 (which I recently turned into 12000).

      go to another bank, friend!

  69. Jaime

    WEEK 3 RESULTS

    This exercise had me feel like a total idiot, and I made a lot of mistakes, but it taught me a lot.

    Having already negotiated down my internet bill this month, the one thing that’s not really optimized is my credit card. A year and a half ago I had realized that my card didn’t offer an extended warranty, and I couldn’t get them to add the service. I also remember having a 16% APR which at the time didn’t matter because I paid my balance every month.

    This month will be the first month I ever pay interest on my card, so I decided to negotiate down my APR. If that failed, I’d ask for the extended warranty and other perks offered on their better cards.

    I used the script in your book as a baseline and spent 30 minutes practicing out loud and tweaking it to the point where it sounded natural and I didn’t need to read off a cue sheet.

    Me: “Hi, I’m looking to pay off my debt more aggressively in the next week and I’d like to get a lower APR”
    Lower rep: “Let me send you to our person in charge of that”
    Higher Rep: “Let me pull up your records…” (sounds shocked) “It looks like your APR is one of the lowest in the system. You are currently at 9.9% and the next closest is 14.5%. I really can’t lower it any more and it looks like you’ve barely paid any interest on the card. May I ask why you’re requesting to go lower?”

    At this point I’m thinking “wow I’m an idiot for not checking that number first, but it’s still better than I thought I was going to negotiate to. Let me see if I can go a different route.”

    Me: “Well I’d prefer not to switch the balance to a lower interest card, so I’d like to get a lower rate or even an introductory one. I’d hate to do a balance transfer, but the card with the lowest rate will be getting my interest payments.”
    Rep: “I’m really sorry, but there’s absolutely nothing I can do.”
    Me: “If I can’t get a lower APR, I noticed that some of your better cards offer an extended warranty program. Can you provide that service on my card?”
    Rep: “Let me see. It actually looks that service was one that was recently added to your card.”

    At this point I’m just dumbfounded at the fact that I did all this prep work, and didn’t even think to check out what my situation actually was in the past year and a half. Lesson learned.

    What I’m most thankful for is that even though it was just one call, I’ve definitely got a better idea of how the flow in a negotiation works. And that it is important to have a backup plan in case you can’t push any farther. I know I made a few mistakes this time, but I will definitely be calling companies from now on if I think it can improve my situation. Tomorrow I’m going to see if I can get a credit on my internet bill because they failed to send a tech out to me for the past 2 weeks, and I’m going to call my credit union and see if they can get me a checking account with interest.

    Thanks Ramit!

  70. Justin L

    So I negotiated 2 separate things, one of which is complete and the other which is still in the works.

    1. I called my credit card company and got my APR reduced to the lowest rate (not very low mind you, but still) after asking for a manager. I said I’m paying $120 per month but the interest is so high I may as well just be paying $20 when $100 is added on right after that payment. I was asked to hold and then the woman came back she said she could reduce my APR as a one time gesture to me, their valued customer, “because they do value me.”

    2. I told my department manager that I want to teach a class on computer shortcuts and efficiency, because my department’s main goal is to routinize company processes to be as efficient as possible, yet the average computer user is very slow at using a computer. I gave her a list of things and she said “wow great suggestions! Let’s me with these people so you can tell them how to do these things so they can teach the class!” I was not thrilled. My next task is negotiate with her to allow me to teach the course by preparing a mock class so she can see I actually know my stuff.

  71. Alex

    WEEK 3 RESULTS

    The short story – today I negotiated a work-from-home arrangement for 2 days per week from my full-time job, with no end date. My commute is 3 hours roundtrip per day, so this saves me 6 hours per week, which I can now spend with my wife and 1yr old daughter. Totally liberating, although it still hasn’t really hit me. Thanks to Ramit for the tips which helped me succeed at this. (and also to Tim Ferriss, I re-read the script in ‘Disappearing Act’ of 4HWW too)

    The details –
    I work at a large TBTF bank, managing a team of software developers. (No they don’t talk about my bonus in the news) It’s review season, and I got my annual compensation communication last week, but by phone since I was on vacation (this was lucky, because it allowed me to prepare for the face-to-face followup this week). I was disappointed with the compensation (2% increase total from last year, despite ranking pretty well at 4 of 5). My goal: negotiate an increase in my “total compensation”. By the way, I know from research that I make a fair amount more than others in similar jobs, and my job is kinda cool, so I’m not really ready to run out the door.

    Script –
    Me: As I mentioned last week, I’m disappointed in my compensation this year, considering I performed well, and the bank did fairly well. [went through percentages last year, this year]. It would be one thing if I underperformed, but what really bothers me is the disconnect between performance and pay.
    Boss: [checked my percentages, generally nodded, explained about bank performance and ‘the way it works’]
    Me: This disconnect has really made my start to dislike my job. I felt this way last year, and hoped it would get better, but it hasn’t.
    Boss [look of concern]
    Me: HOWEVER, I also understand your predicament. You have a lot of great performers which you’d like to pay well, but you are at the mercy of pre-determined money pools, and a company whose overall performance is out of your control, at the whim of markets and economies.
    Boss [profuse nodding, almost smiling]
    Me: So I’ve been thinking of ways out of this stalemate which don’t involve me leaving the company.
    Boss: Oh well that is good, what are you thinking
    Me: I’d like to propose working from home a few days a week on a regular basis. I am much more productive working from home, and the saved commute time would allow me to put in more hours without sacrificing work-life-balance. I could increase my performance, and also be happier with less commute, so it’s win-win. Of course I’d be in the office for meetings requiring my physical presence, and always available on cell.
    Boss: Well that sounds ok, you don’t have to sell it to me. But how many days were you thinking?
    Me: 3 days per week
    Boss: That sounds like a little much, I’d feel much better about 2 days, which is less than half the time.
    Me: Ok I think I can do 2 days.
    Boss: Ok good, let’s talk some more about your compensation numbers
    Me: [blah blah not listening, huge grin on INSIDE, I can’t believe he went for it]

    Tactics I used:
    – Reviewed scripts of other similar situations, and picked key words to reuse
    – Wrote out a loose script in advance
    – Decided increasing pay was a non-starter at this point, so went for something else (tele-commuting)
    – Decided 2 days would be great, so asked for 3 so I had something to give back
    – Decided NOT to use the phrase “on a trial basis” on my wife’s recommendation, but instead keep it in my pocket. this was a good idea since I didn’t need it.
    – Made a soft threat to quit to make the alternative seem less severe
    – Showed I understand his side, and played to his desire to have happy employees and compensate them
    – Practiced! I found a conference room 1 hour before to write my script and said it a few times out loud
    – Timeboxing – I didn’t have a lot of time to work on this – total prep was 2 hours (15 mins at home night before, 45 mins on bus reading 4HWW & this post, 1 hour at office writing script & practicing). This made me focus, especially in that final hour

    Results, and why it’s good –
    – even though it wasn’t dollars, 6 hours of my life back is worth a lot. also gives lots of flexibility to shift hours around. I increased my total compensation. actually it saves me $30 on commute per week also
    – while I worked from home 2-3 times per month previously, a regular arrangement is unheard of, and 2 days/wk is absolutely crazy. Can’t believe I didn’t ask earlier.

  72. Heberth

    This week I apply some of the tips on negotiation for a new car, and got more than a $2000 discount. I remember 5 years ago when was buying my last car, i just blinded agree with the price, and when try to claim, just agree with the reasons the comapny car give me. Not this time! Thanks Ramit

  73. Stephen Wooten

    This was actually my first counter-offer for a “real” job (circa 2007/08′ but still relevant today!), as I was working at Starbucks. The motto I tried to stick to was “never take the first offer”. Below is my ACTUAL email that maybe some people might hopefully find to be valuable:

    == counter-offer ==
    Hello Eric,

    Thank you for the offer, I am very excited to start working for TechCompany but I would first like to discuss the offer that was presented. To start, I believe that even though my title would be ‘software engineer’, I would take it upon myself to really be a team player and add value to every aspect of the company in order to not only help achieve the $1B milestone but to exceed it! I have these personal goals for while working for TechCompany:

    Develop a fantastic product – As a software engineer
    Develop the product to the point where students are demanding their school to purchase the product for them. This would greatly reduce the work for salesmen because schools would be coming to us instead of vice versa.
    Consider the 80/20 rule when developing the software – focus on the most heavily used features (20% of the functionality) of the website and enhance them as much as possible to generate the greatest returns in satisfaction (80% of customers).
    Simplify the product so there is a smaller learning curve to use the site (from my initial impressions of the site).
    Incorporate testing standards to ensure that the product remains stable for each successive version that is released. Testing ensures that the product is high quality and remains so after future revisions. This actually REDUCES development time because you don’t have to go back and fix problems that creep up.
    Study actual usage of the website (physically watching people use the site) and alleviate any problems they run into.
    Ensure scalability of the application so that TechCompany can successfully be used by thousands of simultaneous users.
    Mimic the actions and techniques used by the top most-downloaded Facebook applications to increase the likelihood of a highly popular product.
    Secure the website – As a system administrator
    In the first few minutes of inspecting the website, I discovered that the web server is running Webmin which, if successfully accessed, would allow an attacker complete control over the server and its information. I have a good amount of experience with Webmin and understand how it works to minimize this vulnerability.
    I currently manage my own server running Ubuntu 7.04 Feisty Fawn and must understand everything from the email system (Postfix) to ensuring valid firewall rules to deter attackers from an easy attack.
    Server is currently susceptible to cross-site scripting, which may compromise security. This is important when offering services that use credit cards and other payments over the internet. We must ensure users that they are secure in these transactions.
    Stimulate demand and web presence – As a web marketer
    Help to develop highly effective web marketing strategies to help promote the website.
    Knowledgeable of the top sites out there where we want to be recognized
    Currently have contacts within the blogging community for major websites, such as Mashable.com, that would review the site for us and generate a lot of demand.
    Help the team achieve their own goals – Team player
    I have a broad range of skills and knowledge that can help other employees achieve their own goals. Examples within the first day include my experience with Macromedia Flash – for simplifying the addition of adding quotes to the pages, Basecamp – to help organize the team and establish a single place to collaborate on the product.
    –Sorry for the long-windedness of the email but I want to emphasize the amount of dedication and willingness I have to make TechCompany the leading application to use for your organization. According to salary.com, the median salaries for the bottom 25% of web developers is $56,095/yr for Fort Worth, TX. Although I understand that TechCompany is only 1 year old, I believe I can help TechCompany achieve its $1B valuation. Because of this, I am proposing a starting salary of $4,200 per month, before deductions. I am not at all interested in working a flat 40 hours per week – instead, I am dedicated to helping achieve the goals of the company, regardless of how many hours that will require. As I stated earlier, I look forward to working for TechCompany because I believe in the product and company.
    Link 1: The value of testing
    Link 2: Salary.com – Fort Worth, TX

    === Response ===

    Stephen – this is great!!! Based on your responses below we are definitely willing to offer you $4,200 per month. You clearly are the team member we want on our team. I am confident you will bring much value to TechCompany and we all greatly appreciate it. Thank you for demonstrating your willingness to make the company happen!

    We will call shortly so Aaron can get you fully set up with subversion, email, etc.

    == Long story short ==
    Negotiate based on the value you will add and provide rational explanations and sound reasoning behind your arguments. The raw number should be fair for both parties.

    • Philip

      I’m afraid I don’t understand your reasoning. The way I read this, it looks like you told your new employer that you are very valuable, but that you will settle on a salary ($50k) that is LESS than the average for the bottom 25% of developers in the area ($56k). And then you told them you are willing to work overtime for free.

      I realize this is probably a great opportunity for you compared to your last job, but I think you sold yourself short by proposing a number yourself first, and telling them you would work OT. In my experience it’s much harder to back down after making a promise like that, than it is to work up to working 45-50-60 hour weeks as the project calls for it (and then asking for a raise to account for your output).

      I wish you all the best though, and I hope you don’t work yourself to the point where the money you get isn’t worth it. I’m an engineer and I’ve worked my share of 60 hr / week months. In many places (not all), once you provide that output it becomes the new bar to meet (for everyone in the dept).

  74. K

    WEEK 3 RESULTS:

    I’m getting married in the summer, and I’m thankful that I found your blog 3 years ago because I have a Wedding Savings Account today that has been indispensable and the Earn1k course allowed me to get enough money on the side to top up that account for us this year (of course, I never thought I would get married, and if I did, I thought it would be a small affair… wrong).

    So far, I have talked the reception hall into waiving the setup fee ($500 value) and providing our group with another ‘meat’ option for free ($600 value). I’ve found a photographer who will travel to our location and take extra ‘candid’ shots at the reception in exchange for having her as a dinner guest (a $500 value). That’s $1600 savings alone, just by asking.

    This post has encouraged me to seek out savings in other areas this week. I have sent out an email to a B&B close to the wedding location to see if I could get a discount on the rooms. In the initial email, she quoted her website rates. When I asked for a discount because we would take multiple rooms for the weekend, she sent us a polite note with phone numbers for the other B&B’s in the area. Interesting.

    I didn’t take this polite no for an answer and tried to get in her head. When we spoke to her on the phone before Christmas (just to see whether the rooms were available before booking), she mentioned offhand how she was concerned about rowdy wedding goers, and in the email I sent her, I mentioned that we wanted to book the rooms for a wedding. This might have been the reason we got the cold shoulder from her. I tried to remove these barriers in the next email I sent, and told her that these rooms were only for us and our parents who are in their mid to late 60’s (low maintenance visitors, not ridiculous 20 year old party seekers) and how we would really love to stay in her B&B.

    I haven’t heard back from her yet, and so I can’t report whether this was successful, but at the very least I have more confidence to go one step further during negotiations.

    • K00kyKelly

      I have a lot of friends who have been getting married recently and the trend is anything labeled as “wedding” is at least 20% more. If you get white invitations they’re cheaper than wedding invitations… even if they look the same. It’s like the word wedding is a magical signal to vendors that they can increase prices. One friend’s sister experimented with calling to get quotes at different places they were considering for the reception. If she said it was for a wedding reception it was significantly more than for a large dinner party or any other phrases she tried. Crazy! Same location, same date, higher price just for calling it a wedding!

  75. Biren Shah

    WEEK 3 RESULTS

    I called a client of mine that’s had a project on hold for almost 3 months. In the past, I worked with one person at the company who was the only who understood the value I brought. My contact often got pulled into fighting fires. He’d disappear and the project would stop.

    The results of the negotiation: I’ve agreed to commit to a fixed free project. They were getting stuck on hourly rates and it was a big stumbling block for their company. This way, the project can go on without his direct involvement at every review point.

    In return, he’s agreed to
    – work with me to create a plan to sell my value to the other decision-makers in the company (who were often pushing back)
    – help me create more situations where I can work with the other stakeholders directly
    – some sort of variable upside, still to be negotiated (I’ll be presenting ideas tomorrow)

    Net Gain: A verbal agreement to get me a check on Monday. If so, $3k income for me next month. More based on the variable upside. A chance to become the “solution provide” for this company’s development needs and have my first successful project as a freelance developer–as opposed to cutting them as clients, which is what I would have had to do otherwise (they were wasting too much of my time, but it turned out to be because the deal didn’t fit. It was only because I have such a strong relationship with my contact that they waited for me to figure that out).

    My Script:
    Last we talked, we had an opportunity on the table–but it didn’t go anywhere.
    I’m getting the sense that this arrangement isn’t quite working for either of us.

    Here’s what I see about the problems on your side
    1. You’re constantly being pulled in to fight fires. You don’t have
    time to pay attention to the development side of your business consistently
    2. This makes it take too long to get things done.
    3. It’s mostly you driving the project on your end, and other people are pushing back.

    (it did)

    For me, this isn’t working either–the start and stop makes me have to
    spend a lot of time reviewing old code, remembering where I was, and just
    working on the overhead of picking up where we left off.

    So I was thinking about the problem, and I have a proposal:
    Let’s set a goal–the one we talked about last time is fine. But in addition
    to that, I have two other goals:
    1) to get you out of the critical path, so that I can keep working
    2) Get other people see the value in what I’m doing, and that I can get their time and attention as I need it

    In return, you’ll have a web system you can use 1 month from now.
    I’ll take the risk here–I’m going to have to get
    back into the code, spend an indeterminate amount of time debugging, and
    if you need changes I’ll make them.

    Tactics:
    1. I decided that my usability-testing gains didn’t meet the challenge, so I had better do something more.
    2. Called him (tonight!) and schedule the call for 1.5 hours later
    3. Used that time to write the script
    4. I called him, instead of waiting for him to call me
    5. Just did it.
    6. Got over my negative script “but if I commit to a fixed fee, I might get a much lower hourly rate”. I’d negotiated a very good hourly rate before, but it turned into a stumbling block to building the relationship. Instead, I’m going to try to be efficient and get the work done, and get my first satisfied client. Plus, try to get some commitment for after-the-fact upside to help make the job more valuable for me.

  76. Sue

    Week 3 Results (cell phone bill)

    I called my cell provider and asked about lowering my monthly bill. I checked my stats on Billshrink prior to calling and noticed I was paying more than I should based on my usage. I asked if they offered any other plans not on the website but the rep said no, and I didn’t push it. I did get the lowest plan that will still cover my usage, saving me $35 per month. I realized right after I hung up that I didn’t really negotiate this hard enough, but the fact that I did it at all is a great first step. To even ask – it seemed like such a mountain to climb mentally! But just asking – it’s not that hard, why am I psyching myself into thinking so? Thanks Ramit for getting me past the mental roadblock. I will call again tomorrow after getting some more information on competing plans/offers. Woohoo!

  77. Chris

    WEEK 3 RESULTS

    I’ve had a smartphone bill which has been a bit too high for a while now. My provider likes to outsource its customer service to robots, especially over the phone. It takes a long time to get through to an actual person.

    So instead of my former internal script, which was “there’s no benefit in talking to machines programmed not to negotiate”, I changed to “lets find someone who will help,” and I went to one of the provider’s stores and talked to a real person.

    I negotiated an $89/month calls and $69/month data plan down to a $49/month calls and $29/month data, with no loss of data allowances. I also got a further $13/month off by packaging the calls and data plans.

    Result: Savings over the next 12 months of $1,116! Big win! Hurray! Thanks Ramit.

  78. Ladia skladaci kola

    Hi Ramit
    Negotiation is great, but has two sides as anything in the world.
    I run small shop selling folding bikes for two years now and training my ability decline anybody who even try to negotiate price of bike on me. You should do it gently but firmly. Customer cannot lost his face but also cannot get ANY discount.
    Experience is: EVERY single time I did gave any discount to customer, it lead to more complicated process for me, more wishes, more work and more time spent with customer than with people who paid full price without a word. It is not fair and it is not good for business too.
    So I am learning to refuse it, no matter how is my financial situation and how is the season.
    Customer who needs the discount is not good enough.
    I think you have same rules with your courses.
    The difference is that you should promote your thing and other side of negotiation does not fit in your promoted picture.
    What about to write topic about your experience from view of business owner who fighting negotiater. I think a lot of your student can profit from this also.

    Ladia

  79. Tim Rosanelli

    Ramit,
    Your posts on negotiating is what original drew me to your site.

    Although you don’t like the idea of purchasing a house if any of your readers are, negotiating the house purchase price is one of the biggest wins like negotiating a salary. The problem is that most people trust their real estate agent on determining the price. Real estate agents tend to be very conservative on house purchase price because they get a commission based on the sell price and they want to close the deal quickly and simply.

    When we brought our house, we negotiated a price that was $30,000 less than the real estate agent wanted us to originally offer. My wife had to talk to his manager to make him give the offer we wanted to give.

    Not only did we save the $30,000 on the purchase but it keeps paying us back monthly in less interest. We will save over the $30,000 in interest over the 30 years.

  80. Jordan

    Excuses! I have them …

    I know you said to negotiate something big by Wednesday, but I had my annual employee review set for today (Thursday), so I gave myself a mulligan. The only problem is that my boss had a death in the family and I won’t get to exercise my negotiation until next week.

    BUT! I do have things to report! In your “Get Inside Their Heads” you said that we can’t be thinking of what WE want, but what they will say “Yes!” to. But, you said more than that. I incorporated the other stuff you said and re-wrote your words to say, “What will they say ‘Hell Yes!’ to?” This small change made a huge difference in my life this week. Instead of “getting people to ‘Yes'” I started looking at what people were wanting to say “Hell Yes” to. My wife, my coworkers, my customers. What. A. Week! I’m not even sure how to describe it, but my whole basis for interacting with others has changed. I am a changed man.

    Employee review: I spent 6 hours thinking about what my boss would say “Hell Yes!” to with no thought about what I wanted. I came up with some interesting stuff I never saw before! Once I had a solid understanding of him, his needs, his values, and his perspective, then I put together a small package of what I really wanted. And really, what I wanted was tiny in comparison to what I was offering. I put together hard numbers of what I did last year in the light of what he values (not what I value), came up with a detailed timeline of what I plan to do this year with budgets and milestones, and then how he could support me in doing those things (what I wanted). Now, I’m not even asking for a raise (don’t want one aside from a COLA bump) but what I am asking for is “synergistic” with his values and mine. I can’t wait to talk to him!

    The “Hell Yes!” attitude has also resulted in me scrapping my freelance plans. I don’t know of anyone who would say “Hell Yes” to what I was offering. Now, I’m on a hunt for “Hell Yes” in my field, and it’s ok that what I come up with is not new, unique, or exciting. That’s a huge change.

    • Carolina

      I love the “Hell Yes!” method. Thanks for posting!

  81. Willie A

    Ramit,
    I’m going to keep it short and sweet. Been a fan of the site for quite sometime, but I admit I was one of those individuals that was “all read no action.”
    Week 1 I set a script to rid of my debt.
    Automation: Purchased your book IWTYTR
    Week 2: Became aware of behavioral change supercedes mental change. Set up several small triggers for items I will accomplish.
    Week 3: Negotiating my CC apr’s. I successfully negotiated a lower apr on 7 of 11 cards. In addition, all 7 by a minimum of 45%.

    I’m a believer!
    Kudos to you sir, you are indeed a Gentlemen and a Scholar!

    Willie

  82. Sarah

    Called my credit card company, they flatly refused to reduce my rate or increase my credit limit, ha! It felt good to give it a shot though, planning to negotiate fees with my estate agent next… 🙂

  83. Alan

    I negotiated my salary and didn’t let them pin me down on a figure.

    I highlight my VALUE to the company and why it was only fair they increase my pay – the boss agreed. Now, it’s time to face down HR.

  84. Carolina

    Thank you for posting this. I had my review Monday and did well (bonus structure went up) and already out-prepraring the sh*t out of a salary review I requested for the end of February. I didn’t want to jump in unprepared. HOWEVER….I did negotiate the APR down on my credit card from 22 down to 9.99% today. THANK YOU so much. I used the script in IWTBR book and got courage from this week’s post. I’m pumped to keep honing my negotiating skills. Thank you!!

  85. Jenn Mc

    I’m applying for a new job and it has a spot for salary in the app (state govt position). Hoping I can get around this so & can negotiate the salary up.

  86. Amy

    Hi Ramit,

    Wonderful post about negotiation! I would love it, however, if you could address something about negotiation that still has me stumped.

    I changed jobs recently. Near the end of the string of interviews, the employer let on that I was by far their top candidate. The company actually pays a bit on the low end (which they make up with AMAZING benefits), so I expected a low offer… but the number they gave me was disappointingly low even with my lowered expectations. Despite this, I was able to negotiate them to a number I was happy with… 8k more than they originally offered.

    Despite the success, and despite the fact that the entire process was friendly and civil and they loved me, I couldn’t STAND the negotiation process. What tips do you have for overcoming that awful feeling?

    I believe the feeling stemmed from
    1) Lack of self confidence, and
    2) A strong desire to make people happy

    The former comes into play because if you aren’t sure you DESERVE more money, you don’t want to ask for it, and you feel like a fraud when you’re turned down. This is hard for me because I am a woman in a field that is dominated by men, and those men tend to feel, or at least act as though they feel, much more confident/arrogant.

    The second comes into play especially for women too… we have been socialized to be nice rather than confrontational. The idea of making someone unhappy or uncomfortable can be really hard and awful for some people, and negotiating does often have that effect.

    So – any advice?

  87. Antonio

    WEEK 3 RESULTS

    Antonio (Mexico)

    I get a 50% discount in my credit card debt… that means 3,000 dolars. It’s great since I’m unenployed now, and starting as a freelancer.

    Strategy:
    1.- I read the first chapter of IWT book.
    2.- Call the first day… someone told my my request was impossible. 20 minutes dealing without upseting. I just repeat and repeat myself… poor guy in the cal center.
    3.- Second day I call again… 30 minutes just asking and asking. “It is impossible, he told me”. I admire his patience.
    4.- On third day a girl answers… give me a great deal. 50% discount, 5 months payments.
    5.- I ask for an advanced payment with one new client so I can get the first parymento to the credit card.

    I don’t know how I’ll get the rest… but know I know it’s possible to re-negotiate.

    That helps me a lot.
    Thanks Ramit

  88. Stabitha

    Late on the uptake here, but I took your advice and negotiated my cable bill down nearly $20. I didn’t want to sacrifice my DVR service (conscious spending plan!), but I did want to get my bill back to looking more like it did when I first had it installed 3 years ago. The script I used:

    ME: Hi, I’ve noticed my cable bill has gone up since I’ve become a subscriber and I’d like to have that re-evaluated.

    THEM: Okay, let me have a look at your account…I can offer you x promotion of (basically what I paid at the beginning) for 12 months no contract.

    ME: Great, thanks!

    That 10 minutes will save me $215 this year, and it was so easy!

  89. Rebecca

    I don’t know about others, but for me, one of the barriers to negotiation is that I’ve worked in the past in the grunt positions where I truly did not have the authority to bend any rules for anyone– yet aggressive, entitled jerks still persisted in wasting my time badgering me. (I worked in a box office once, and the phrase I came to hate more than anything was, “You have better?”– meaning better seats. The instant I heard those words, I would hate the people uttering them because I knew they were about to make my life miserable.) So I have always resisted doing anything that would make me seem like those customers.

    So yeah, not only can you not negotiate everything, but also get as quickly as possible to the people who *can* negotiate with you. Don’t be a jerk to the peons making minimum wage who have no power. Just ask for a manager.

    Also, I heartily agree with everyone who’s said “be willing to walk away”. At my current job, people have had job offers rescinded because they tried to negotiate a better salary– this place is hard and fast (and cheap) on their offers! I think it’s important to remember that if something like that happens, you’re better off. Even if you’re feeling kind of desperate at the time, which I was when I started here.

    This year I got a 16% salary increase. I wasn’t given a say in the number, but then I didn’t actually think I was going to see another dime. I can’t say it was brilliant negotiating; I’d had several salary conversations with my boss, laying out all the value I was providing, pointing out the salary compression going on, etc. She agreed I was worth more but we both knew it was an uphill battle. I think the thing that spurred her to take up the fight was when I told her I’d started freelancing on the side (not against policy; many people here moonlight openly) in order to be able to afford to stay at this job at all, and that it was burning me out. I was considering going the get-the-competing-offer route, but I’m glad I didn’t have to, because I’d really rather use the time to build my freelance endeavors and get out on my own!

  90. Sophia

    Ramit – I’ve been reading you blogs for a couple of months now. I’ve also started implementing steps from your book. One of the things I did after reading “negotiating” article was talk to my apartment manager. My lease renewal was coming up and the rates around where I live are going up at a phenomenal rate (Like you said – I did my research before walking into the office). I also walked into the leasing office 15 days prior to the “renewal notice” so that I had further room to negotiate. I’ve been staying here for the past 6 months and I wanted to stay at a lower apartment fee or the same. Initially, the leasing office turned down my request. However, when I mentioned that I’ll be willing to sign up a lease for 12 months – they went ahead and reduced me rent by $200 a month. Had I wanted in 15 days later, my rent would have jumped up to 200$. The year has barely started and thanks to this article- I was able to save 2400$ for this year.

  91. Hasan Diwan

    A few months ago, my boss wanted to cut costs. One of the largest costs was that of people (ie me). So he told me that he’d be cutting my salary 20%. I retorted that I’d cut my hours 20% and expect to be able to determine which day I’d take off. Futher, I’d like the lost 20% as possible performance bonus. He started calling me onery names, like “mercenary” and “dirty capitalist”, but eventually he agreed to my terms. Oh and I got a 100% performance bonus in December with a promise of another one every quarter provided the firm was making money.

  92. Vínculos marginales « Notas marginales

    […] negociar mejor que el 99% de la […]

  93. Elizabeth

    All of this is extremely enlightening. I’m a pretty good negotiator when it comes to products and services (e.g. cable, CCs, etc), but I am only on my first professional job.

    I just obtained a new job in a department of one of the largest local government agencies in the country (trying to mask the identity here…) and attempted to get a better salary than they offered me. However, in several government organizations, they work off of a percentage rule – 5% or 7% increase of the current salary. I managed to get HR to go up to almost 7% increase, but this number is largely disappointing – especially for a person with 2 master’s degrees.

    What kind of advice do you (or readers of this blog) have for negotiating with government agencies, who have rather inflexible rules regarding pay? It seems that a lot of this advice is geared toward those in business.

    Thanks!

    • K00kyKelly

      For jobs like these the key is to figure out what they can give you credit for. Most of these agencies will have a formula they use – one component of which is the discretionary percentage you mentioned above. Possible inputs to the formula include things like years of experience and degrees, but there are other things that aren’t necessarily on your resume. Volunteer experience with relevant groups might be able to get added into the experience, awards you’ve won, certifications you’ve earned, outside leadership experience, etc. Another tool that people will use is an offer from an outside company or organization.

      It sounds like you’re hitting the limitations of an internal transfer. This always seemed the craziest to me – why would they pay an outsider more than someone fighting for a higher salary from the inside? See if you can befriend in HR or the hiring group that can give you a lowdown on the internal rules. Not the official lowdown, but more focused on the exceptions to the rules. Who gets these exceptions? How do they get them? What does the agency respond to negotiation wise?

  94. Philip

    I’ve been following this advice to negotiate with headhunters.

    Today I went back and forth (like in the video) with someone who wanted to know “where I’m at”. I finally got a salary range and I said that I fit within the range and would prefer to wait to discuss salary until after the interview once I see the complete package. He pushed again one last time for a number “or we can’t proceed”. So I said I would like to be paid based on the value I bring to the company and not where I’m currently at, and I’m sure we could work something out. So then his tone changed and he thanked me for my time and said he’d keep in touch if he found something that was a good fit.

    My current employer low-balled me (before I knew better) and even though my performance reviews are in the top 10% of the dept, I haven’t been able to make up the gap I created for myself by starting lower.

    I’m not really disappointed but I wanted to see if anyone else has had a similar experience. Did I push too hard? Or is this not as common?

  95. Anurag Gupta

    very nice post specially that Video , after read watch your post I am very glad for your too good , Recently i was visit a job search site the name is placementindia.com and it is very good for search a new opportunity, I think as per you can visit on this site ,

  96. www.insidesepa.de

    Ich bin eine ganze Weile im Internet gesurft. Ich denke mal so ca.

    2 Stunden und habe in diesem Zeitraum keinen solch informativen Beitrag gefunden, wie deiner.Weiter so!

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  99. naukrihub

    A couple of stories from the other side of the negotiating table. At my previous job I had a brilliant job applicant right out of school. I offered him a salary, which was a bit low (he was after all, straight out of school).

  100. John

    Hey Ramit,

    I am extremely thankful for your wonderful tips on negotiation. I am a fresh graduate student and I recently used your techniques for negotiating my job offer which resulted in an increase in the base pay by 5K and also a signing bonus of 10K.

    I need your suggestions about my last negotiation step that I want to try. I plan to request the HR for reducing my signing bonus by 5K and transfer it to my base pay giving the reason that I will save some money by paying a lower tax rate on the base salary as compared to the signing bonus. I really like the job and HR has mentioned in the last email that it is the final offer. I want to make sure that my final negotiation step does not ruin my entire offer.

    Please advise.

  101. Mitchel

    wow, great article, cant wait to renegotiate with that squirrel that i’ve been letting stay in my attic for the past month, he has over extended his stay!

  102. Shwas Homes

    This post is just overwhelmingly impressive, this is out of the world, totally rare.

    Apart from this, I love how always Ramit Sethi put very things into basics – putting everything into Acquisition, Behavior, and Outcome bucket. Love it totally.

    One of his best article. You deserve a bow Ramit Sethi .I totally mean it.

    Thanks for making our life better and taking us out of the mediocrity.

  103. aprval

    I don’t agree, read that: http://www.jamesaltucher.com/2011/01/8-alternatives-to-college/

  104. lockett1948

    I do not agree. Look at: http://www.newyorker.com/magazine/2014/02/17/cheap-words
    Sincerely, Daisey