Making sure you get paid what you are worth can be difficult, especially if you have just been offered a great job. But don’t be shy, and remove the myths about salary negotiation from your brain, because if you don’t, they can prevent you from getting the salary you deserve.

I used these principles recently to get a friend from an initial offer of 2.8% to a 19% pay rise on a new position – yes, in the middle of a recession! That’s almost 7 times more! She was extremely disappointed with the first offer she received, but too polite to ask for more – until she talked to me of course! Please be aware of these myths, and don’t fall victim to them:

Myth 1: Aim for the highest salary

When you look at your life, you will probably realise that cash is not always the most important thing. Consider carefully other benefits, bonuses and quality of life that a position affords. The job with the highest salary might enslave you and leave little time for home, hobby or sport activities.

Myth 2: Employers don’t like negotiating salaries

Most employers have respect for a person who is firm in the way he values him/herself. There is no harm in justifying to an employer why you deserve more.

Myth 3: If you don’t indicate your expected salary, your application won’t be reviewed

You will sometimes find “expected salary” to be a requirement in job ads. By quoting a figure, be it too high OR too low, you can either eliminate yourself from consideration, or lock yourself into a salary that is below what you really want.

If you are qualified and meet all other criteria, employers will not ignore your resume because it doesn’t list a salary range.

Myth 4: There is no room to move

If an employer believes you are the perfect candidate for the job, and the offer on the table is below your expectations, it is rare indeed that they have no room to move. Exceptions are possible.

Myth 5: A “starting salary” is OK to begin with

Don’t fall for this one! Most salary increases are negotiated on your current wage. Accepting a lower “starting” salary, without any negotiation, will impact your negotiations for years.

Myth 6: Asking for less improves your chances

Few employers hire on salary alone, and his strategy can sometimes backfire by devaluing you in the eyes of the company, and actually decrease your chances of landing the job.

Myth 7: Agree to the offer ASAP

Don’t believe that if you don’t jump at an offer, an employer will rush to make the offer to someone else. Get the offer in writing, and if you have any doubts, take at least 24 hours before accepting. Understanding that you have room to negotiate will help you to get the salary you deserve – the first offer from an employer is rarely the last and final offer – salary negotiation is part of the process.

Know Your Value

Knowing your own value is one of the most important skills to have generally, but being able to realise it is even more important. Look at the value you add and expect to be compensated accordingly. If you are unable to get the compensation (monetary and non-monetary) you think you deserve there are always alternatives – you are more resourceful than you dare to let yourself think!

Salary Negotiation – How I Helped a Friend Get a 7 Times Larger Pay Rise is a post from: Smart Money Mindset.com

Though the current global recession seems to be easing we can all still use tips to help us save some of our hard earned money. Just by utilising a little creativity and changing our mindset we could each be saving hundreds, if not thousands per year and increasing our own bank balances rather than those of the loan companies!

3 Top Tips for Saving Money

Mortgage lenders, loan and credit card companies all use the law of compounding to make sure they squeeze every last penny that they can out of you. Not only do you pay interest on your loan, but you pay interest on the interest. This is how financial companies keep us in debt for as long as they possibly can and they certainly don’t want you to know these tips for saving money!

Stay With Your Current Mortgage Provider

Yes, you read it right! One thing that many people do not realise is that when you change mortgage lender you also reset your interest payments to start from the beginning. Since the majority of your monthly mortgage payments in the first 12 years is actually paying the interest rather than the actual loan, when you switch to a new lender you actually restart this process. This means that the more times you change lender the more interest you will pay over the lifetime of the mortgage. What a waste of your money!

Ask Your Credit Card Company for a Lower Rate

Another one of my top tips for saving money is asking your current credit card provider to lower their interest rate for you! Just give them a call and ask them. Point out what a good customer you have been, how you pay on time and that you would like a reduced rate please. The customer service advisor may be a little surprised, but you can get a reduced rate if you negotiate in the right way.

Save Money on Anything Using Simple Negotiation Techniques

Try these out to see for yourself how you can buy nearly anything, from an apartment to an apple, for lower than the ticket price.

Act reluctantly – Pretend you are not interested in the product and watch the salesperson lower and lower the price until you buy!

Ask for more than you want – Always offer a price lower than what you are actually willing to pay. 9 times out of 10 you will pay either what you wanted to or less than you expected.

Which of these top tips for saving money will you try? If you decided to do all of these things you could save yourself hundreds per month – think of how those savings could be used!

3 Top Tips for Saving Money is a post from: Smart Money Mindset.com

Learn how in only a 5 minute phonecall you could save double digit amounts on your credit card interest rate!

Credit card companies are keen to keep you as their customer – no matter how they may act. You are worth a lot of money to your card company and have a lot more power than you realise in your relationship with them. Use this fact, and the call scripts below, to your advantage to lower interest rates on your credit cards by simply asking them. You can save thousands using this method.

Credit cards and how they make money

Credit card companies make money from their customers in a variety of different ways. Apart from the interest rate they also make money from late payment fees, cash withdrawal or credit card cheque fees, or even from companies that want to put leaflets in your monthly statement letter.

However people aren’t aware that credit card companies also make money by you simply using the card, as retailers are charged a fee by the companies providing the card machines in their stores, and part of that goes to your credit card company. So credit card companies are very interested in keeping you as a customer – remember this in your call!

You must understand how call centers work

The majority of your interaction with your credit card company will be over the phone, and so will this negotiation, so you need to know how call centers work. I worked in a call center for over a year on various campaigns as they are called, on both inbound and outbound calls. My job was to monitor and train call center staff on making sales calls and dealing with customer cancellations – i.e. stopping them.

What you’ll find with call center staff is that they will have differing levels of authority to take actions depending on their experience and grade. So whilst one might not be able to change anything on your account, others will be able to make significant changes. The call center staff will also be under instructions to NOT lose customers – remember you are worth money to the card company and they will avoid losing you as far as possible.

The Negotiation and Call Script

For this I want to use some key negotiation principles. Firstly make it fun – negotiation is a game remember? So have fun on the call and smile (the person on the other end of the phone will be able to tell). Secondly use powerful open questions, and no questions with a yes/no answer. When asking questions put the pressure on the other person to come up with a solution – make it their problem.

So call your credit card company and follow these instructions:

After the introduction and security checks the call should go as follows:

Call center: “So how may I help you?”
You: “Could you tell me the APR on my credit card please?”
Call center: “It’s XX% sir”
You: “Please reduce that for me”

At this point the call center may be a bit lost, but will likely ask why you want the rate reduced or will say it’s not possible. In response do not say things like “Are you sure?” or “Why can’t you reduce it?” as these offer an easy way out to end the call there and then. Instead tell them that you are a good customer, have been paying your card on time and would like the rate reduced please. After your explaination use the line “So, please reduce the rate for me”. The use of the word “So” is important as it implies everything that been said before it is true and justifies what is said after.

If they refuse again use the argument that you have been offered better rates elsewhere, but you don’t want the inconvenience of moving credit card companies. Use the “So…” line again. A lot of companies have a three “No” rule which means around the third “No” from either person, a different approach has to be used.

If the call center representative says they are not authorised to lower the APR then ask to speak to someone who is, and repeat the above script.

You are most likely to be successful if you also bank with the card company, have a good history of making payments on time on the card, have regular use of the card, have a good credit score, or any combination of those.

What if they say no?

So what happens if you are unsuccessful? Just try again. Yes, it’s that simple. You will most likely get through to another advisor, and hopefully one with greater authority to change your rate. If they say “I notice you called earlier today/this week” just answer “yes” and stay silent. What if you called earlier? It doesn’t change anything about this call, although they will hope it puts you off asking them to reduce the rate again.

It’s worth trying this!

Changing your credit card APR can make a huge difference to you, especially if you are in the process of paying off your debts. For example if you have a balance of $1,000, and minimum payments of 2% of your balance per month, a change of APR from 20% to 15% could reduce the actual amount of interest you pay in cash by up to 56%! (I’ve made some nice spreadsheets that do all the calculations for me in case you’re wondering!). So it’s well worth trying it out!

Tell me how you get on

Please do try this out and tell me how you get on. I would love to hear from people who have tried the above technique and got their rates down – and try it on multiple cards if you have more than one. If you don’t mind send me the figures on your balance, the minimum payment per month, and the old and new APR so I can work out the impact it will have on your finances. Email these to info@smartmoneymindset.com.

Good luck and remember the customer is always right!

Reduce the APR on Your Credit Card in 5 Minutes! is a post from: Smart Money Mindset.com

Here’s some advice on using negotiation tactics learnt from Indian parents to save yourself plenty of money.

One thing about being the child of Indian parents is that you get to see them in operation across a number of areas – feeding 200 members of family with a highly effective mobile kitchen infantry unit; fitting 200 members of family into a three bed-semi; getting every single auntie you’ve ever met to drag you onto the dancefloor at a wedding; organising an array of potential suitors when a daughter or son is ready for marriage (I’ve managed to evade this one so far!).

However the most impressive, and to be honest most uncomfortable, is when they are negotiating over buying something. You see being brought up in the UK has given me the fantastic quality of English politeness, which is respected around the world. However our desire to be what we think is polite often leads us to missing out on opportunities to save money.

I remember many a time wanting to curl up and become invisible when the following conversation would take place when on holiday between my mum and usually a shop keeper trying to sell some souvenir or gift:

Mum: “How much is this please?”
Shop keeper: “It’s $50 Madam” (or whatever the currency was)
Mum: “That’s too much, I’ll give you $5″

Now my wanting to be polite would never let me start the negotiation off there, but my mum had been genetically engineered as an Indian to know how to negotiate, and had also probably seen her parents do the same. And you know what? She might not have got it at $5, but most likely at $10 (still less than my starting price would have been), and interestingly that was usually the price the shopkeeper was aiming for anyway.

This tactic is known as an Opening Gambit in negotiation terms and stated simply means “Ask for more than you expect to get”. You will quite often surprise yourself with what is possible.

There’s a saying that goes “You never make more money per hour than when you’re negotiating”. If you think about it, it’s usually true.

What’s being too polite costing you? Let me know and what you could do about it!

Check out my upcoming Top Ten Indian Negotiation Tactics for more on this!

How Being Too Polite Costs You Money is a post from: Smart Money Mindset.com

Save Money on Virtually Anything With The Top Ten Indian Negiotiation Tactics (TINTs)

Here’s my top ten list of the Indian Negotiation Tactics (TINTs as I call them) that I have picked up off parents, uncles, and random relatives I’d never seen before or probably will again…

I’ve used these and similar tactics to negotiate anything from £5 off a hat to over £100,000 off an investment property. The key is to take one tactic and try it out next time you are buying something, get comfortable using it, and then add more tactics as you go.

Of course you probably can’t use these tactics in Harrods (although I’d be interested to hear if anyone has!) but without doubt these will save you money.

10. Be a reluctant buyer

Approach the negotiation as if you’re not really interested in buying and just looking. Any whiff of keeness on your part and the price automatically increases.

9. Get them to go first

Never ever give your price first – even if they have a price tag get them to start the negotiation with a price. If possible get them to give you an already discounted price before the negotiation starts. A good line is: “What’s the best price you could give me on this my friend?” (add the my friend bit in there to make it harder for them to be hard-nosed with you!)

8. Flinch and Use Silence

When you get the price flinch, as if it almost hurts to hear that price, and at the same time say something like “Wow!” or repeat the price… then stay silent, even if it gets uncomfortable. The last bit is key!

7. Always ask for more than you expect to get

Always set your price lower than you’re prepared to pay. If you set it at what you want to pay and they accept immediately you’ve lost out on saving some money!

6. Smile and make it fun

Negotiation is a game and treat it as such. Always be smiling and friendly, joke and make it fun. It’ll make the process more light-hearted and harder for the seller to resist your demands.

5. Bracket

Bracketing is where you make a counter offer so that the average of the prices is really what you’re prepared to pay. E.g. If the price is £20, and you’re happy to pay £15, offer them £10 and let them come down.

4. Take up lots of their time

The more time you take up, the more energy and effort the seller has invested in the negotiation, and the harder it is for them to walk away without getting something back for all that time and effort.

3. Remove authority

Make it so that you are not the decision-maker. e.g. “I have to check with my husband/wife etc.” That way you always appear friendly and blameless for all the negotiation hassle

2. Ask for that bit extra

Even once you’ve got down to almost agreeing a price and you sense the seller won’t budge, ask for something extra to seal the deal that is not cash. For example if you’re buying a bed and sidetables, ask for a lamp for the sidetables so you can read at night.

1. Be prepared to walk away

And finally, but most importantly – in any true negotiation you have to be prepared to walk away. The moment you think you want what’s on offer and won’t go back your mindset will change, and the seller will pick up on this. Always be prepared to walk. Very often you get the deal just as you’re walking out the door.

Let me know what you think of these!

Save Money With Indian Negotiation Tactics! is a post from: Smart Money Mindset.com