Afford Anything Podcast Summary
Episode: The Secret Psychology of Successful Negotiators
Host: Paula Pant
Guest: Matt Schultz
Release Date: November 29, 2024
Introduction to Negotiation Power
Paula Pant opens the episode by highlighting the underestimated power of asking questions in everyday financial decisions. She introduces Matt Schultz, author of Ask Questions, Save Money, Make More, who elaborates on how simple questioning can lead to significant financial gains both at work and in personal life.
Maximizing Earnings at Work
Timestamp: [01:00] – [03:00]
Matt Schultz emphasizes that employees can increase their income without changing jobs by meticulously tracking their weekly accomplishments. He advises creating a "laundry list" of daily tasks and exceptional contributions to present during performance reviews or promotion discussions.
“Taking notes really make a difference. ... it allows you to better understand your own value and kind of key yourself up to present yourself well.”
– Matt Schultz [02:30]
The Reluctance to Ask for More
Timestamp: [03:00] – [05:27]
Despite its potential, many avoid asking for more due to fear of rejection or intimidation. Matt reveals that 90% of people who request credit card fee reductions succeed, debunking the myth that such asks are rarely fruitful.
“90% of people who ask get that waived. ... you're going in a position of power because they want you to stick around.”
– Matt Schultz [05:22]
Practical Negotiation Strategies
Timestamp: [05:56] – [09:53]
Schultz outlines strategies such as open-ended questions to facilitate more productive negotiations. Instead of asking yes/no questions, framing inquiries to encourage dialogue increases the likelihood of favorable outcomes.
“Make sure that you're asking open ended questions. ... It’s a way of starting a conversation rather than just asking a yes or no question.”
– Matt Schultz [10:00]
Negotiating Major Financial Decisions: Mortgages
Timestamp: [11:52] – [15:22]
Applying negotiation principles to significant purchases like mortgages, Schultz advises comparison shopping and leveraging multiple quotes to secure better rates and lower fees. Even minor rate reductions can result in substantial savings over the life of a loan.
“A quarter point rate cut on a $360,000 mortgage is $20,000 over the life of the loan.”
– Paula Pant [15:00]
Building Rapport in Negotiations
Timestamp: [17:12] – [23:34]
The importance of building a positive relationship with the person you're negotiating with cannot be overstated. Being personable and respectful can significantly influence the negotiation's success.
“Don't be a jerk. ... People like to help people that they like.”
– Matt Schultz [23:10]
Negotiating Compensation and Benefits
Timestamp: [29:45] – [37:09]
Schultz underscores the broader scope of negotiations beyond salary, including benefits like tuition reimbursement, mentoring, and remote work options. He recommends preparing by identifying what matters most and anticipating potential counteroffers.
“If you are nervous about thinking through things on the fly, ... it's a really helpful thing.”
– Matt Schultz [32:50]
Identifying Red Flags in Employment Negotiations
Timestamp: [38:09] – [42:14]
Recognizing when an employer is unresponsive to reasonable requests can illuminate underlying issues within the company, such as lack of growth opportunities or poor management practices. Schultz advises using these signs to evaluate long-term fit.
“They always say that people don't leave companies, they leave bosses. ... That can certainly be a red flag that it's time for you to go.”
– Matt Schultz [40:43]
Effective Negotiation in Personal Relationships
Timestamp: [53:37] – [62:49]
Negotiation principles apply to personal relationships as well. Schultz suggests approaching sensitive topics like money with thoughtfulness, setting appropriate timing, and ensuring the conversation remains constructive.
“This is not even so much about negotiation, but just these are what I'm hearing you outline are principles of how to have constructive money conversations.”
– Paula Pant [55:49]
Key Takeaways
Timestamp: [73:48] – [77:27]
Matt Schultz distills the conversation into three essential lessons:
-
Your Power as a Consumer:
“Banks and other businesses want to keep your business ... You're going in a position of power because they want you to stick around.”
– Matt Schultz [74:16] -
Track Your Achievements:
“Keep track of your wins, even the small ones. ... when it's time to talk about a raise or a promotion.”
– Matt Schultz [75:27] -
Create Win-Win Situations:
“Make it a win win. ... it's good for the company and making me better makes the company better.”
– Matt Schultz [76:27]
Conclusion
Paula Pant wraps up by reinforcing the episode's core message: Never underestimate your power when it comes to your money. By adopting effective negotiation strategies, tracking personal achievements, and fostering mutually beneficial relationships, individuals can make smarter financial and professional choices.
This episode serves as a comprehensive guide for anyone looking to enhance their negotiation skills, whether in the workplace, financial dealings, or personal relationships. Matt Schultz's insights provide actionable strategies to empower listeners to advocate effectively for their financial well-being.