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Anchor Price Your Salary

: Image by Dalboz17 via Flickr

Conventional wisdom says that, when negotiating your salary or a raise, you should make whatever crazy ninja maneuvers it takes to get the other person to name a number first.

Horse pellets.

Have you ever watched an infomercial? Those masters of of impulse marketing geared towards insomniacs, invalids, and inebriates?

“How much would you pay for this fabulous meat tenderizer/eyelash waxer? $399? $299? No! If you call within the next 73 seconds, we will let you take this home for the low, low price of just $99.99!”

That’s the magic of anchor pricing.

The first number you hear is the number you will base all further numbers on. If you hear a high number, other lower numbers will feel much lower by comparison. The number doesn’t even have to be about money.

There was a study done that had the subjects compare a price to the last two digits of their social security numbers. Those with higher digits found higher prices to be acceptable, while those with lower prices only accepted cheaper prices.

What does an infomercial marketing ploy have to do with your salary?

If you are negotiating your salary and your potential employer gives a lowball offer, every higher counteroffer after that will much, much higher than than it would otherwise. On the other hand, if you start with your “perfect” salary, they amount you will be happy to settle for won’t seem to be nearly as high to the employer. At the same time, you will be less likely to accept a lowball offer if you set your anchor price high.

For example, if you are looking to make $50,000:

The employer offers you $40,000. $60,000 seems too high by comparison, so you counter with $50,000, then compromise and settler for $45,000. Or, you could start at $60,000, making the employer feel that $40,000 is too low, so he counters with $45,000, leaving a compromise at $52,000. That’s a hypothetical $7,000 boost, just for bucking conventional wisdom and taking a cue from the marketing industry.

How have you negotiated your salary?

What do you do?

Life

You’re not your job. You’re not how much money you have in the bank. You’re not the car you drive. You’re not the contents of your wallet. You’re not your ******* khakis. -Tyler Durden

“What do you do?”

They typical answer is usually something like “I’m a computer programmer.” Or a DJ, a cop, a barista, a stripper, or whatever.

The answer is always given in the context of work. Is work the center of your life? Is your career the most important thing you have? For many, it is. Our jobs become a fully integrated piece of our identities. Even when we pay lip-service to putting our families first, all too often, we spend more of our waking hours working than actually living.

We spend 40, 50, 60 hours each week at our jobs. It’s natural for that to become a part of us.

We go too far.

I am not my job. I am not my career.

I am a father, a husband, a writer, a blogger, and more. I have hopes, dreams, and ambitions entirely apart from my career.

I hope you do, too.

The next time someone asks you what you do, try responding with your passion.

“I’m a parent.”

“I grow freaking awesome roses.”

“I travel whenever I can.”

“I obsess over politics.”

Leave the tradition work-centric script behind. You’re going to confuse the people who are expecting it. They think they are asking about your job and you are responding with something that truly matters to you.

What do you do?

Identity Theft: What To Do When You’ve Been Victimized

Finance

<a href= — Image by Don Hankins via Flickr

Have you ever been surprised by having a credit application denied? Or been told that you’re paying too much for your car insurance because you have bad credit?

There are 15 million victims of identity each year with an estimated loss of $50 billion. That’s a lot of cake. If you’re credit card gets stolen, you’re only liable for up to $50 of the theft, but what if your checking account is cracked or someone is opening accounts in your name? What is the indirect cost coming form higher interest rates?

Identity theft happens. It could happen to you.

What should you do if you become a victim of identity theft?

File a police report. You’ve been victimized, make sure you have some documentation of that.
Contact any credit card company that has possibly been affected. If you lost your wallet, call them all. If somebody has opening cards in your name, call all of those.
Call the credit bureaus* and have a fraud alert put on your credit report. This will force any new creditor to take extra steps to verify your identity before opening a new account. Ideally, your identity thief won’t be able to make the grade. If that isn’t enough, look into an identity freeze. That will stop a lender from even seeing your credit report without your explicit permission.
Close your bank accounts Depending on how severe the theft, you may need all new accounts at every level. If the thief has a box of your checks, or even your account and routing numbers, you need to close the accounts to protect your money.
Report the theft to the FTC at 877.438.4338. You’ll get additional documentation of the theft, including an ID Theft Affidavit that can make it easier to clean up the mess.
Hire a witchdoctor to curse the soul of your attacker. No, he probably won’t actually turn into a warty toad, but what if? Maybe the universe will wield the Magic Karma Hammer and beat him into a little greasy stain in the street.

The important thing to remember is to hurry. The longer you wait, the more damage will be done and the harder it will be to straighten out. As soon as you find out about the theft, start fixing it.

Have you had your identity stolen? How did you deal with it?

The Obligatory Thanksgiving Post

Finance

Tomorrow is Thanksgiving. Tomorrow is also Thursday, and I don’t post on Thursdays, so I’ll be posting about Thanksgiving today.

Thanksgiving is a day to be thankful for–first and foremost–capitalism.

When the Pilgrims first landed, they set up a communal farming arrangement, figuring that a good Christian community could take care of its own. From each according to his ability, to each according to his need, and all that. Everyone worked for the good of everyone else, so everyone benefited, right?

The Pilgrims, like every other group that has ever advocated communism, neglected to consider human nature. If you have no incentive to work, you don’t. If sleeping in and making babies still gets you fed and clothed, why work?

On the other side, if you work hard, only to see your hard work go to benefit your lazy neighbor, sleeping in and rattling the headboard, but never doing anything productive, why bother?

It didn’t take long for the Pilgrims to notice this tragedy of government wasn’t working.

The strong, or man of parts, had no more in devission of victails and cloaths, then he that was weake and not able to doe a quarter the other could; this was thought injuestice. The aged and graver men to be ranked and equalised in labours, and victails, cloaths, etc., with the meaner and yonger sorte, thought it some indignite and disrespect unto them. And for mens wives to be commanded to doe servise for other men, as dresing their meate, washing their cloaths, etc., they deemd it a kind of slaverie, neither could many husbands well brooke it. Upon the poynte all being to have alike, and all to doe alike, they thought them selves in the like condition, and ove as good as another; and so, if it did not cut of those relations that God hath set amongest men, yet it did at least much diminish and take of the mutuall respects that should be preserved amongst them.

It didn’t take long before nobody was working. Neighbors resented each other, because everyone had a right to the work of the other, with no need to compensate each other. That’s a case of “I’m starving because you aren’t working hard enough, but it’s not my fault you’re starving.”

At one point, the production of the colony was down so much that the colonists’ ration of corn was just 4 kernels per day. That’s how you kill a colony.

But they learned from their mistakes before they all died.

Yet notwithstanding all those reasons, which were not mine, but other mens wiser then my selfe, without answer to any one of them, here cometh over many quirimonies, and complaints against me, of lording it over my brethern, and making conditions fitter for theeves and bondslaves then honest men, and that of my owne head I did what I list. And at last a paper of reasons, framed against that clause in the conditions, which as they were delivered me open, so my answer is open to you all. And first, as they are no other but inconvenientes, such as a man might frame 20. as great on the other side, and yet prove nor disprove nothing by them, so they misse and mistake both the very ground of the article and nature of the project. For, first, it is said, that if ther had been no divission of houses and Lands, it had been better for the poore. True, and that showeth the inequalitie of the condition; we should more respecte him that ventureth both his money and his person, then him that ventureth but his person only.

The slavery of working for the benefit of others didn’t work, unless you were “theeves and bondslaves”. Then, it was great, living off of the sweat of others.

To make a long story short, the starvation ended when the Pilgrims were given parcels of land and told they could keep what they built from it. They went from the edge of extinction to being prosperous in a short time. The old and weak were cared for, not by the governor’s decree, but by the generosity of their neighbors.

Everybody in the colony won.

2012: The Year the World Ended

Finance, Life, Relationships

December 21st marks the day that Mayan calendar-makers decided was far longer than they needed to waste their time carving

English: Mayan calendar created by a modern cr... — Image via Wikipedia

days into stone.

More importantly, it marks the beginning of the week before my birthday. No self-respecting civilization would end the world just a week before my birthday.

This is traditionally the time that people look back at the previous year, and make resolutions they don’t intend to keep in the following year.

Who am I to buck tradition?

In 2011, I became a bit of a workaholic.

This site has taken off a bit. I’m not about to retire off of the proceeds, but it has turned into a nice little side income. Thank you for that.

I launched a marketing company. We do web design/development, social media work, and search engine marketing. It’s strictly a part-time gig right now, but it’s growing and taking up most of my free evenings and weekends.

I’ve been working 50-60 hours a week at my day job.

The plus side? I’ve also paid off almost $20,000 of my debt in 2011, bringing my total to $47,535 left.

It’s been a lot of work, but the harder I hustle, the sooner I can stop hustling.

What’s in store for 2012?

On the work front, I plan to cut my weekly load down to 40-45 hours again. Life it to short to work all of the time.

I want to expand my new company to the point that my day job is optional. I’m projecting that by spring. Call it June 1st.

Here, I want to double the size of my audience. I don’t just want random people popping in, I want to grow an engaged audience. That means more comments and more discussion. Expect to see more along those lines.

I’ve also got a couple of products under development. By year-end, I’d like to have them both released.

On a personal level, my biggest goal is to carve out a regular chunk of time to spend with my wife. Working all of the time has cut into our quality time together. I want to find a way to schedule date nights at least twice a month. It will cost more money, but that’s part of why I’m working so much.

Financially, I want to kill the last of my credit card debt. That’s down to about $17,000. We’ll need to keep working at it, but it’s a reachable goal. That means we still don’t get cable, I still avoid buying books every week, and my kids still have to live with not getting every whim fulfilled.

To recap: I’m going to work smarter, grow my side projects, and make this site better for you. In the process, I’m going to kill the last of my unsecured debt, and drag my mortgage down to it’s last gasping breaths.

Here’s to the end of the world….

Human Interaction

Business, Life

Life may be like a box of chocolates, but it is certainly not a game of Sorry, where one person wins at the expense of all others. It is entirely possible for everyone to win in most voluntary interactions.

For example, if my company gives me a $10,000 raise, it would seem like I win and they lose. I’m getting more money, at the expense of their bottom line, right? Maybe. But what if that raise spurs me on to make an extra $100,000 for the company? That makes it a good investment and a Win/Win scenario.

When I’m dealing with one of my side-business customers or an advertiser, I’m definitely pushing for the Win/Win. Of course I want them to pay me as much as possible, but I also want their repeat business, which won’t happen unless they walk away happy. If I insisted that each of my customers pay the absolute top dollar, I may come out ahead in the short-term, but what about next month or next year? It’s much better for both of us if we can find a happy middle ground.

The four basic forms of interaction are:

1. Win/Lose. This is where I win and you lose. Haha! The problem with a Win/Lose is that the loser isn’t going to come back to play next year. He’s not happy and he’ll probably tell his friends how unhappy he is. This is also the interaction that people are mistakenly assuming when they complain about excessive executive interaction. The CEO is making a million dollars while the folks on the assembly line are stuck with $15 per hour? It’s entirely possible that, if the CEO weren’t doing his job, nobody else would have one. That is, like it or not, Win/Win.

2. Lose/Win. This is where I give up everything, hoping you’ll eventually throw me a bone. It’s a cowardly interaction that won’t work well when dealing with someone playing #1. I’ll keep giving, you’ll keep taking. You go home happy, I go home sore. When it’s done, I won’t do business with you ever again.

3. Lose/Lose. Nobody wins. We fight so hard to get what we want, forcing the other side to give up as much as possible, while they are doing the same. At the end of the day, the hatred is flowing so strong, there’s no possibility of a relationship.

4. Win/Win. Yay! Everybody wins! Everybody’s happy! This will involve some compromise, but hopefully we can reach the happy middle ground where we are both smiling. If I’m looking for a deal that involves you paying me $1000 per month, is it better for me to push to get exactly that, or let myself get talked down to $750? If the $1000 is more than you can afford, so you quit with hard feelings after one month, the ongoing $750 is much, much better for both of us. It is actually in my greedy self-interest to give up that 25% to build our relationship.

Winning doesn’t have to be done at the expense of others. If you do it right, we all win.

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