The key to financial success is all in the way you negotiate.
There are so many ways to make more money than you are right now. Not all of them are as accessible and feasible though. I mean, unless you can create Facebook or Instagram overnight, you’re stuck with the rest of us. It doesn’t take closing a big financial deal or creating a viral invention- there are little adjustments you can make that will equate to higher pays and saved cash in your piggy bank.
One of these skills that is directly linked to your financial success is your ability to negotiate… to negotiate well and efficiently. The art of negotiation is indeed an art. It is an art that pays off though. Just like any sport or painting a canvas, it takes a practice. To some people it comes a little easier, to others, it takes some commitment to learning. It’s like playing poker- a big part of it is luck (whether you guessed what the other person is thinking, correctly, or not), but it’s also skill.
We’ve rounded up situations and skills that will teach you when and how to negotiate properly. Either way, we promise that gearing up your negotiation skills will equate to more of that cash money you’re craving.
Situation #1: Art of Negotiation x Employer
You’re asking for a raise. You just got hired and you’re discussing a salary rate. You are solidifying a commission rate.
This is perhaps the most common situation that will also have the most impact on your financial success. Your career or job is, after all, your money making tree. That being said, learning how to negotiate with your employer is major.
When you’re negotiating with your employer, keep these things in mind:
- Know when to stop. They are your superior, so the line of where to stop is important to find. You don’t want to end up with nothing, especially if this is your best or your only offer.
- Know where they stand. Try to decipher through misleading or indirect comments/questions what the status of your employer is. If you’re asking for more money, ask about how the company is doing. Be observant too- who is being hired at the office? why are they being hired? are they being paid less?
- Know your strengths because they are your leverage. If there is no one else in the company that can do what you do, make sure this is mentioned (in a polite way, of course).
- Know your weaknesses, because they will use them against you. When it comes to money, people are often ruthless. Make sure they don’t pummel you to a pulp. Remember to know your worth.
Situation #2: Art of Negotiation x Home
You’re buying a new house. You’re figuring out a leasing deal. You’re trying to settle on a rate with a room mate.
Some people don’t realize how important negotiating a deal for their home is. Living is a necessity, yes- but it’s also something you’re committed to. Especially with rising housing costs, it’s important that you know just how much money you’re committed to paying every month. This is your biggest living expense.
When you’re trying to pinch some cash negotiating on your home, keep these things in mind:
- Keep in mind the other party’s opening offer. This will tell you a lot about what they’re expecting and how low they’re willing to go.
- Keep in mind not to go too ridiculously low. They might skip out on you and you’ll lose the home deal entirely.
- Keep in mind what your budget is. Be straight with them about your budget and try not to budge too much even if you really want the place. Sometimes we become seduced by the allure of a new home that we forget about what we can realistically afford.
Situation #3: Art of Negotiation x Services
You’re shopping for the right mortgage broker. You’re in need of a good lawyer who won’t rape your wallet. You’re in the search for the best mover.
This is your daily negotiation practice. The money you’re saving isn’t going to have extreme lasting repercussions like when you’re negotiating for your home. Treat it like practice. Try and fail at finding the best rate for whatever you’re in the market for. This will teach you to identify and read others and their expectations better.
When you’re negotiating for services, keep these things in mind:
- You’re in the driver’s seat here. You have the upper hand in the negotiation because you are the consumer. That being said, you can be a little more liberal in your negotiation tactics- making it a perfect learning experience.
- Don’t be nervous because they’re a stranger. You really don’t owe them anything. If you think you’re coming off too cheap, you don’t know them, so don’t feel embarrassed.
- Keep in mind your time frame. If you need something right away, keep that in mind because you may not have the time to shop around for the best rate.
What was your best or worst experience in negotiating? What did you learn from it?
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