The new year brings an opportunity to take stock of what we have and where we would like to go.
Individuals set New Year’s resolutions, companies launch new initiatives and we chart out what we would like to accomplish over the next year. For some people, taking a new approach to their finances will be near the top of their list, which may include asking for a raise a work.
While compensation reviews may not take place in January, it is a great time to begin to prepare for negotiations. What follows are five tips to make the conversation more successful.
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Do your research. When you are asking for a raise at work, know what you are worth on the open market.
One source is www.salary.com, where you can enter job title and geography and size of the company to get ranges of comparable jobs. Industry trade associations may also have useful information about salary ranges for various types of jobs in their industry.
Be ready, however, for others to interpret your data differently.
Understand if you or the party is anchored on a number or range. It is very tough to move from anchors that people have predetermined.
Practice to build confidence
If it’s an important negotiation for you, role play different scenarios with someone. The other person can play the role of the other party and by doing several walk-throughs, you will likely uncover how the other party may be thinking and the positions they may take.
Practice the words you will use on the tough issues. For example, if the offer is lower than your expectations, choose words like “the number I had in mind is $X”.
If in salary negotiations for a new job and asked about your prior compensation, politely decline by saying “I prefer to keep that confidential. Given my experience and qualifications, I’m looking in the range of $X.”
This practice will help you navigate through the discussion and maintain your emotions. You will bring more confidence into the real negotiation.
Find common ground
Particularly in a work situation, try to find what you do agree on first, to set a good foundation for the rest of the negotiations.
Are there projects that you completed that led to a good result for the organization overall? Tie your work and achievements to key initiatives of your organization or department.
Putting yourself in the other party’s shoes is extremely valuable. It may be that you agree on 80 percent of the issues, so by identifying these you can focus on the true areas requiring further discussion.
There is an emotional component, too, where we feel better about each other when we agree, setting the positive foundation for the trickier issues.
Ask questions – and listen
Make sure you understand the other person’s concerns and not just at a surface level.
People often say one thing when there is really something else going on. Use phrases such as, “Tell me more.” Use active listening and then paraphrase the points so the other person knows they’ve been heard.
You may find more common ground or better understand their concerns and then address them more effectively going forward.
Under stress, we often speed up.
Instead, use pauses to slow yourself down. Having the other party talk more is not a bad thing. Count to 10 before responding in an emotional situation. Slowing down can help you craft your language carefully.
Be thoughtful, respectful and measure in your approach. Don’t show them you’re sweating. Avoid being negative or worse, rude, about the other position. This is not a race to the finish.
Ask for 24 hours to give yourself space to think through all the ramifications of the offer.
Take these steps and you will likely be more confident and successful in your upcoming negotiations.
Patrick Amey and Joni Lindquist are Certified Financial Planning™ professionals and members of the Financial Planning Association of Greater Kansas City. Patrick is a financial planner and Joni is a principal at Aspyre Wealth Partners.