Bestselling Author Ramit Sethi Giving Free Trip Anywhere in the US to One Lucky Wise Bread Reader
Ramit Sethi's new book I Will Teach You To Be Rich officially launched on Monday, and it is already #5 on Amazon's Bestseller List.
To thank his supporters, Ramit is giving away one roundtrip ticket anywhere in the United States to one Wise Bread reader. Simply order the book within the next 48 hours and forward your receipt to wisebread@
Ramit will also be a guest tomorrow on Wise Bread's Blog Talk Radio Show (9pm EST / 8pm CST / or 6pm PST) to chat with Linsey about his 6-week program for fixing your finances.
5 Things You Should Never Do in a Salary Negotiation.
1. Don’t tell them your current salary.
Why do they need to know? I’ll tell you: So they can offer you just a little bit more than what you’re currently making. If you’re asked, say, “I’m sure we can find a number that’s fair for both of us.” If they press you, push back: “I’m not comfortable revealing my salary, so let’s move on.
What else can I answer for you?” (Note: Typically first-line recruiters will ask for these. If they won’t budge, ask to speak to the hiring manager. No recruiter wants to be responsible for losing a great candidate, so this will usually get you through the gatekeeper. Also, some government jobs require you to reveal your salary. But if a place insists that you reveal your prior salary, it’s a pretty good sign that it’s not a great job.)
2. Don’t make the first offer.
That’s their job. If they ask you to suggest a number, smile and say, “Now come on, that’s your job. What’s a fair number that we can both work from?”
3. If you’ve got another offer from a company that’s generally regarded to be mediocre, don’t reveal the company’s name.
When asked for the name, just say something general but true, like, “It’s another tech company that focuses on online consumer applications.” If you say the name of the mediocre company, the negotiator is going to know that he’s got you. He’ll tear down the other company (which I would do, too), and it will all be true. He won’t focus on negotiating, he’ll just tell you how much better it will be at his company. So withhold this information.
4. Don’t ask “yes” or “no” questions.
Instead of “You offered me fifty thousand dollars. Can you do fifty-five thousand?” say, “Fifty thousand dollars is a great number to work from. We’re in the same ballpark, but how can we get to fifty-five thousand?”
5. Never lie.
Don’t say you have another offer when you don’t. Don’t inflate your current salary. Don’t promise things you can’t deliver. You should always be truthful in negotiations.
Should I invest or pay off my student loans?
It can be difficult to hear the drumbeat of “invest early!” when you’re scrambling to pay $500 or $1,000 in student loans each month. But when it comes to putting money toward investing or your student loans, you really have three choices:
- Pay the minimum monthly payment on your student loans and invest the rest.
- Pay as much as possible toward your student loans and then, once they are paid off, start investing.
- Do a hybrid 50/50 approach, where you pay half toward your student loans (always paying at least the minimum) and send the other half into your investment accounts.
Technically, your decision comes down to interest rates. If your student loan had a super-low interest rate of, say, 2 percent, you’d want to pursue option one: Pay your student loans off as slowly as possible because you can make an average of 8 percent by investing in lowcost funds.
However, notice I said technically. That’s because money management isn’t always rational. Some people aren’t comfortable having any debt at all and want to get rid of it as quickly as possible. If having debt keeps you awake at night, follow option two and pay it off as soon as possible—but understand that you could be losing lots of growth potential just so you can be more comfortable.
I recommend you take a close look at option three, and here’s why: The interest rate on most student loans these days is similar to what you’d get in the stock market, so frankly your decision will be a toss-up. All things being equal, the money you would stand to make by investing would be about the same amount that you’ll pay out in interest on your student loan, so basically it’s a wash. It won’t really matter whether you pay off your student loans or invest, because you’ll get roughly the same return. Except for two things: compound interest and tax-advantaged retirement accounts. When you invest in your twenties and early thirties, you get huge benefits from compound interest.
If you wait until you’re older to invest, you’ll never be able to catch up on those earnings. Plus, if you’re investing in tax-advantaged accounts like 401(k)s and Roth IRAs, you’re getting gains from tax benefits. That’s why I would consider a hybrid split, paying off your debt with part of your money and investing with the rest. The exact split depends on your risk tolerance. Most people will simply choose a 50/50 split to keep things simple, but if you’re more aggressive, you’ll probably want to invest more.
No Purchase Method of Entry: On a plain 3″ x 5″ paper, hand print your complete name, address, daytime telephone number, e-mail address and date of birth, and mail your completed entry in a hand-addressed, stamped envelope, to: Ramit Sethi, 2269 Chestnut Street, #160, San Francisco, CA 94123. Limit one (1) mail-in entry per envelope. All mail-in entries must be postmarked before March 26, 2009 and received by April 4, 2009. Mechanically reproduced or automated mailed entries are not eligible. All entries must be complete to be eligible. All entries become property of the Ramit Sethi and will not be returned.