Each week, we ask a personal finance or business expert for their money pro tips. This week we talked to negotiation expert Ed Brodow. Want more money pro tips? Sign up for the Easy Money newsletter to get fresh advice from money experts in your inbox each Friday.
What are some unexpected financial obligations that can be negotiated?
Income tax, loan rates and fees, professional fees, credit card balances, hotel rates.
How can a novice negotiate these terms?
People are hampered by the assumption that certain things are not negotiable. The first thing to remember is that everything is negotiable.
Begin by working to upgrade your negotiation consciousness: (1) Challenge everything and (2) don’t be afraid to ask for what you want. For example: When your doctor gives you a bill, don’t be intimidated by their medical degree. My doctor gave me a bill of $1,800 for a lab test. When I challenged it, they found a reason to lower it to $500. If I had kept my mouth shut, I would have unnecessarily parted with $1,300. Nothing is fixed in stone. Even the IRS will let you negotiate — it would rather get something from you than nothing at all.
What should you do when someone says ‘This is non-negotiable’?
Everything is negotiable. When they tell you it isn’t negotiable, that is merely the first step in their strategy. It is up to you to challenge it. Don’t believe everything they tell you.
How do you recover from a negotiation that doesn’t go your way?
If it involves an ongoing relationship, try for a better deal next time. If you wind up paying more for a car than you planned, learn the lesson and vow to do better in the future. Don’t cry over spilled milk.
What is a money achievement you’re most proud of?
I always try to challenge what I am being asked to pay. Most of the time, my efforts pay off. When they don’t, at least I am satisfied knowing that I did my best.
How can I convince someone that they should give me a discount?
Try using the ‘Squeeze’: Your competitor is selling it for less. Demand that they meet the competitor’s price. Also the ‘Sob Story’: I’d love to buy your product, but I can’t afford it. A third way is to find a product with a minor defect. That will allow the seller to save face if they give you a discount.
What is the most important question to ask in a negotiation?
Always ask yourself: What is the pressure on the other side? Why do they have to make the deal? What is the weakness in their position? Your power derives from their weakness. Even if they appear nonchalant, they inevitably have worries and concerns. It is your job to be a detective and root these out.
How can you negotiate during a job interview?
Try to be the interviewer rather than the interviewee. When you take control of the interview, you appear stronger. It also demonstrates that you are not desperate. The prospective employer will be more likely to hire you if they think you don’t need the job.
What’s the biggest negotiation mistake you see people make?
The biggest mistakes people make are: (1) They don’t listen and (2) They don’t take their time. Listening is the most important skill for negotiators. When you pay attention, you can discover the other side’s weaknesses. When you rush a negotiation, you are more prone to making errors. Learn to be patient.
What’s the biggest thing people should remember when they go into a negotiation?
Always be willing to walk away. Determine what your bottom line is. The bottom line is the worst outcome you will accept. If you can’t achieve it, be willing to walk away. When you are willing to say, “If I can’t get the deal that I want, I will walk away,” you can never be intimidated.
Want more pro tips? Sign up for the Easy Money newsletter to get fresh advice in your inbox each Friday.
This interview was lightly edited for clarity. It is intended for informational purposes and should not be considered legal advice.
Image: Nastia Kobzarenko