Money Rehab with Nicole Lapin - How To Negotiate With Your Bank, Your Landlord and Your Boss

Episode Date: February 20, 2023

Nicole gives a masterclass on negotiating in three acts: negotiating with your bank, your landlord and your boss. In each act, she gives you specific strategies and talking points for each scenario. Plus, at the very end of the episode, Nicole shares her golden negotiating tip for every situation. Ramit's full episode here: https://link.chtbl.com/4RL3Zp-g Landlord negotiation episode here: https://link.chtbl.com/VqaWmaQH How to ask for a raise episode here: https://link.chtbl.com/-N70byah

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Find a co-host at Airbnb.com slash host. I'm Nicole Lappin, the only financial expert you don't need a dictionary to understand. It's time for some money rehab. Happy President's Day, money rehabbers. It is a bank holiday today, but you know what doesn't take bank holidays? Ironically enough, your money. And if your money is on, so is Money Rehab. So today's episode is a special one. It's all about one of my favorite topics,

negotiation. And we're going to dig into this topic in three acts. We're going to start with a little role play action with Ramit Sethi. Ramit came on Money Rehab to talk about target date funds, but you're going to get to hear now a new, never-before-heard part of our conversation all about how to get your bank to reverse an overdraft fee. Next, we're going to tackle negotiating rent with your landlord and for the grand finale, best practices around asking your boss for a raise. So let's start with act one, negotiating overdraft protection fees. Not too long ago, I talked on the show about the recent mess over at Bank of America that ended up triggering a whole lot of issues for customers, including overdraft protection fees and mystery withdrawals.

So overdraft fees have been on my mind a lot lately, and I wanted to talk you through how you can get your bank to reverse these types of fees. So I did. Here's that conversation with Ramit. Okay, so I love how animated and excited you are, Ramit, and how you approach this. And I love to see you and other financial experts provide scripts on having these tough money conversations, because I think, you know, the biggest enemy is sometimes between our ears, the mean girl, the mean guy inside our heads who we have to tell many times to take several seats. On the show, we recently covered the story of Bank of America. You alluded to Wells Fargo being a clusterfuck as well. Their account holders were overdrafting because there were missing funds from their accounts, but it was not their fault. It was the bank's fault. So

it feels like really timely to talk about how to get overdraft fees waived. Do you mind if we do a little role playing? I love a role play. Let's do it. Okay, so I'm going to be the bank. Perfect. You're going to be Ramit. Hello, I'm your bank.

What can I do to help you today? Hi, my name is Ramit. I just was looking at my account transactions and I saw that I have an overdraft fee a week and a half ago, and I'd like to have that waived. Ramit, Mr. Sethi, I see that fee. Unfortunately, we're not able to waive that fee. You are enrolled in overdraft protection, and we've outlined in our literature how overdraft protection comes with fees. Okay, I understand that. I do see that it's a $27 charge here, and I would really like to get it waived. What can you do for me? Hmm, one second, sir. I want to check with my supervisor.

I've seen you've been a really good customer. Can you hold for a second? Of course. Insert elevator music. Okay. I talked to my supervisor and because you're such a valued customer, we can do this for you. Awesome. Yay. Okay. So let's say the bank plays hardball. Let's say you're not a good customer. Let's say you're like a mediocre customer at best. Do you still have leverage? No? I can give you a script. You know, like I said, I've been a customer for this long.

You don't want to lose me, blah, blah. Like the banks, realistically, like we actually kind of do want to lose you. The mediocre customers. Maybe they don't want you as a customer. Like I've fired customers from my own business. There are indeed bad customers. The customer is not always right. Correct. Let's zoom out. The bigger question here is, can you set up a system where you do not overdraft? Because I frequently tell people that you do not want to focus on the $3 questions. You want to focus on the $30,000 questions. So a lot of people, they're over here like, oh my God, I got this overdraft. I'm so mad. And I go, okay, call the bank, try to fix it.

But let's elevate beyond this $20 overdraft fee. $30,000 questions are things like, am I investing automatically every single month? What is my asset allocation? If I have debt, do I know my exact debt payoff date? Have I negotiated my salary? Because there's a way to do that using chapter nine of my book. Those are $30,000 or even $3 million questions. Fix the overdraft fee. Maybe you get it waived, maybe not, but you've got to restructure your finances so that overdrafts are not a topic of discussion. After a while, we should not be talking about this. So unless you need to hop on the phone and call your bank right now, let's move on to Act Two. I'm going to share a conversation from one of my most listened to episodes ever, a money rehab intervention where I help a listener fight back against her landlord's mandate to raise her rent.

Here it is. I just got a notice from my landlord. He sent me an email in the middle of August, just saying that he was really sad to report that he's going to have to raise my rent by $400 a month. And I just thought that that was a little high. It is high. Between us girls, how much can you actually spend? A little high. It is high. Between us girls, how much can you actually spend?

Right. And that's a really good question. What I pay is $2,800 a month just flat for a three-bedroom apartment. I could go up to $3,000 with all of the additional costs on top. Now, I have twins who just graduated from high school. So they're both in college. And one of them is living at home. One of them's not at home. So do I need a three bedroom apartment? No. Would it be nice to have this just, you know,

for another year or so since I work here, we live here, the kids know this, they think of this as home. So I'm flexible as far as moving out goes. But I'd rather stay. Have you chatted with anybody else in the building? I have. It's a three family house. So there are three of us, three families who live here. And the people who live directly above me, I saw and they received the same email. And then the people who live on the third floor, I have not been able to reach yet, but I would imagine that they've been given the same letter, the same email, the same email, I should say. So the people upstairs have decided to wait to see what I'm going to do before they reach out to the landlord. Okay. And what do they want? You know, I think we're all on the same page that we

understand it's been seven years since he's raised the rent. Does he deserve to make a little bit more money? Sure. But $400 a month, it just seems to be outrageous to me. My biggest suggestion is going to be whatever we discuss today, talk with or I'm happy to talk with to some of the other tenants because banding together is going to be a really good option if you guys think this is unfair. There's more power in numbers for this. This guy, right, we have to think about what he wants. He doesn't want to be out of all the rent.

He also doesn't want a crappy tenant. I'm assuming you've been a great tenant. You pay your bills on time. You don't cause havoc. No wild parties, ragers, whatever. Right. Yeah. So say that regardless. So come up with a plan altogether, I think, with your fellow tenants. It's not a big building. Losing all of you would be devastating to him. It sounds like you're all really reasonable. all of you would be devastating to him. It sounds like you're all really reasonable and he doesn't seem completely off his rocker. So he's probably reasonable, too, if you approach it in the right way. So I think you guys all want to get on the same page with how much you would feel comfortable

paying more as a percentage and then try to essentially unionize together to get that as the increase for the entire building. So the other suggestion is to offer to accept the new terms, but ask for other things like, you know, I don't know your specific scenario, but anyone else listening who might be in a similar position. Some could be like a free parking spot or a free storage space, or if you live in a building with a gym, you could ask for that. You could ask for things that make your life easier, like getting on an online portal to pay rent. You could ask for better security. You could ask for updated fixtures. You could ask for a deep cleaning of the unit. You could ask for deep cleaning of the common areas. So there are a lot of things that can make your life easier that have monetary value

that could actually justify a higher rent. Hold on to your wallets. Money Rehab will be right back. I love hosting on Airbnb. It's a great way to bring in some extra cash, but I totally get it that it might sound overwhelming to start or even too complicated if, say, you want to put your summer home in Maine on Airbnb, but you live full time in San Francisco and you can't go to Maine every time you need to change

sheets for your guests or something like that. If thoughts like these have been holding you back, I have great news for you. Airbnb has launched a co-host network, which is a network of high quality local co-hosts with Airbnb experience that can take care of your home and your guests. Co-hosts can do what you don't have time for, like managing your reservations, messaging your guests, giving support at the property, or even create your listing for you. I always want to line up a reservation for my house when I'm traveling for work, but sometimes I just don't get around to it because getting ready to travel always feels like a scramble, so I don't end up making time to make my house look guest-friendly. I guess that's the best way

to put it. But I'm matching with a co-host so I can still make that extra cash while also making it easy on myself. Find a co-host at Airbnb.com slash host. And now for some more money rehab. So many of us are getting our rents raised in this crazy market. So if you want to hear the rest of that conversation, check out the link in the show notes. For act three, the last act in this negotiation masterpiece, we're going to bring it home with a topic that brings a lot of people into my DMs. How the F to ask for a raise. Take a deep breath and let's get into it. So here are the five tried and true tips that have worked for me. First, set yourself up for success. Think really carefully about the best time to approach your boss.

5.30 p.m. on a crazy busy Monday? Probably not the best time. At 5.30 p.m. on a summer Friday? Hard no. The same day your boss has a one-on-one meeting with your CEO about budgets? Yep, steer clear of that time too. Actually, steer clear of any day your boss has a budget meeting. Even if a budget meeting goes perfectly, they're still really fucking stressful. So instead, shoot for a time that you know your boss is going to be in a good mood, or the chances are pretty likely that they'll be in a good mood. Is there a team birthday on the books? A pitch you know is going to go well? That's a great time to make your move. Next, tell your boss that you're going to put some time on his or her calendar to talk about a growth plan. One of the key ways to protect your relationship with your boss during a raise negotiation is to convey

that this conversation is about more than the money for you, even if it's not. That's why I like calling this conversation a growth plan. From your boss's perspective, giving you a raise is basically your boss advising your company to invest in you. A conversation on a growth plan implies to your boss that you're planning on staying with the company, that you want to grow in your role and therefore want to increasingly add value to the company. Plus, putting time on your boss's calendar and setting the topic in advance will force you to have the conversation, even if you're tempted to check it out. Second, do your homework. When you've set aside time on your boss's calendar, don't go into the conversation without a number. Studies

show that people who approach a raise without a set reasonable number in mind are less likely to climb the pay scale. Talk to friends in similar industries to see what they're making, and then find averages for your industry and level of experience on sites like payscale.com and salary.com. These sites allow you to search geographically, which is important as you decide what you need to live on in your specific area. And remember, the idea isn't to get a raise just to get by, but to have a little extra to dump into savings. Ladies, this is a special side note for you. When you're getting some industry intel on how much your peers are making, make sure that you're talking to men and women in your field. Because as we know,

there is a pay gap with women making less than men in some of the same roles. And here on Money Rehab, we are not down with that. So once you've done your research, shoot for the high end of the averages you find. As my grandma used to say, reach for the moon, and even if you miss, you'll land among the stars. Or as one of my girlfriends amended, shoot for the moon and don't fuck it up. Earth is a long way down. Number three, bring the receipts. When you meet with your boss, come prepared with specific examples of your stellar performance and positive feedback that you've received from colleagues and clients. You don't need an entire laundry list of all the awesome things you've done

at work, but a few key examples and cite a few important lessons that you've learned during your time at the company and express the desire to continue to learn and grow within that environment. Your employers will be more likely to invest in you if they see the raise as having long-term value. I know, I know, it is awkward to talk yourself up. So practice your little pitch. Do it in front of the mirror. Do it with your dog.

Try for a warm but pointed delivery. Number four, put your community first. This tip is specifically aimed at that nagging concern about souring your relationship with your boss. After all, the numbers on your paycheck may change, but you're still going to be working with the same people. The key here is to frame that discussion around your role within the company. Think of yourself not as a single moving part, but as a valuable asset to the company at large.

Demonstrate how your performance has positively impacted the company's performance. And finally, let your boss know that you respect his or her opinion by concluding with, what do you think? Number five. Get creative. Sure, a salary bump is the most typical kind of raise, but there are lots of other ways to reward your performance, and some might be even more valuable to your current financial and personal situation than just money. Perhaps it's a more robust

health care package, which will help mitigate your monthly health care bills. Or you can ask for better stock options or to be included in the company's bonus structure should they have one in place or more transportation stipend. Whatever it is, you know your company and you know where you can ask. Maybe your side hustle is heating up and you want some extra PTO. Every company has PTO. Whatever you ask for, though, the point is to know your worth and to make it work for you. So my suggestion is to have three different options prepared going in. One, just a money increase. One, a money and perks increase. And one, a perks increase. Depending on how the conversation goes, if your boss simply says there is no more cash in this company and pulls the

pandemic card, whether it's true or not. You can move over to the next option, which would be a little bit of cash and some more perks. And if that doesn't go well, then you also have the perks option that you can fall back on. And scene. That was my mini masterclass on negotiating for all occasions. If you want to hear more of my conversation with Ramit, my listener intervention with Kim, and all my top negotiating tips for getting a raise, the links to the full episodes are in the show notes. So even though these negotiation scenarios are super different, you may have noticed one common thread, which leads me to

my number one negotiating tip you can take straight to the bank. When you're negotiating, always come prepared with a creative alternative to what you really want that would still be a perk for you. I'll give you an example. If you ask your credit card company to waive a fee and they won't, ask for something else extra, like a credit limit raise. Or for the promotion scenario, if your boss isn't willing to give you a raise, ask for a non-monetary bonus like more vacation time. In general, you won't get what you want every time you ask, but you can get something if you come prepared with that secondary ask in your back pocket.

Money Rehab is a production of Money News Network. I'm your host, Nicole Lappin. Money Rehab's executive producer is Morgan Levoy. Our researcher is Emily Holmes. Do you need some money rehab? And let's be honest, we all do. So email us your money questions, moneyrehab at moneynewsnetwork.com to potentially have your questions answered on the show or even have a one-on-one intervention with me. And follow us on Instagram at moneynews and TikTok at moneynewsnetwork for exclusive video content. And lastly, thank you. No, seriously, thank you. Thank you for listening and for investing in yourself, which is the most important investment you can make. you