Tenth Commandment: Honor Thy Wealth and ProsperityBy Jack Chapman
When shopping for a house once, I was told by a realtor that if
I wasn’t at least a little embarrassed at how low my offer
was, it was not low enough. Similarly, negotiating a salary or
raise, if you’re not just a little red-faced at your desired
amount [Ideal Number], you’re not thinking high enough.
It has to pass the "laugh test," however. If it's ridiculously too high, they'll just laugh. Likewise an employer’s offer must pass yours, lest you laugh because it's ridiculously low.
Once, my daughter asked for my negotiation advice and (surprisingly) followed it. She had been a star document organizer in a nation-wide class action lawsuit with 800 trials pending and mountains of e-paperwork to track, file, retrieve at a moment’s notice. She lived in Manhattan on her $35,000 [= $17.50/hour] annual salary. After she left the firm, for reasons other than salary, they ran into trouble. They called her back and asked her to consult with the remaining paralegals to show them her organization and retrieval system.
My daughter and I figured that $150/hour would be fair. Once they had agreed on her consulting role, timing, independent contractor status, etc., her old boss said, “I suppose we can start at the usual $35,000.”
They flunked her laugh test.
When you present your number, don’t share a small number, share your Ideal. Your “Wow!” number. (Quick reminder, though. Remember Commandment 1. Wait until you’re sure they’re ready to make you an offer.) Your ideal number should make you blush a little (or it’s not high enough).
Make sure, of course, it’s bolstered by a solid value-proposition. (See Commandment 5.) Let them know the rationale behind the numbers and you can soften the economic blow by saying, “This may be just a bit out of reach, but I think I owe it to you to tell you what would really excite me. It’s ________.”
Think about it. Why would you start negotiations any lower?
There’s a curious phenomenon. In negotiations, the first number you put out will act as a magnet and pull their number toward it: the higher your number [assuming it passes the laugh test], the stronger the magnet.
The only worry in going first and going high is that you might catch your employer off guard and the Ideal number has such strong magnetism that s/he agrees to overpay you. However, if you feel bad/guilty for taking advantage of his/her poor negotiation skills, you can always give it back! You can always say, “You know, I think I was a little too demanding in the negotiations and while I expect to be your star employee, I want you to feel good about my earnings. Why don’t we take 10% of my earnings and give them to a charity we can both agree on?”
To the best of my knowledge, no one’s ever done that, but just in case you’re too timid or embarrassed to go for the gold, remembering this might help you engage that last little bit of motivation to “Honor Thy Wealth and Prosperity.”