People’s attitudes toward money can easily impact their financial standing in life. That is not to say that if you like money, you will make money. Your attitude is different than your wants; it is how you approach situations that involve financial discussions, which may include anything from salary negotiations to buying or selling property or even haggling over a T. shirt in a bazaar.
Of course mishandling some situations can have longer-term effects than others. For example, getting stuck in a low-paying job could undermine your financial situation for years. But all these small purchases that you overspend on because you’re unable to research or pursue discounts can add up to a big amounts. So even if you’re money-oriented, you may find it difficult to keep tabs on your options and develop a good way to handle negotiations.
Here is how you know if your attitude toward money is a hurdle in the way of creating a sound financial life.
Do you avoid money conversations?
If you feel uncomfortable when money comes up whether it is in the context of salary negotiations, household expenses, or the like, your issue may be related to how you see money. If you cautiously approach money as a taboo, and think that focusing on money in dealing with others including family, friends and coworkers is inappropriate, your avoidance of these conversations is understandable. But that should be an eye opener for you to change.
The impact of taking a passive approach in critical money situations can be damaging to your financial standing. In many situations, especially when you’re expected to negotiate. Sellers may factor your negotiation in an initial price, and when you don’t, you simply pay a higher price than you need. Similarly, if you are the seller, a buyer may throw you low number anticipating that you will try to meet them in the middle. When you don’t, again you simply lose. In short, in many cultures and societies, money negotiations are not only accepted, but expected. So know the rules of the game and participate.
Do you know the price?
One reason people shy away from money negotiation is their inability to know what a particular item — including their own experience in a job situation — is worth in the market. There are of course retail items that can be easily researched and shopped around, but there are also more difficult values to determine. If you’re up against a proficient negotiator, you may find yourself second guessing your own idea of what makes for a fair price.
To avoid this situation, do you research in advance to determine your price range, and don’t be easily swayed with what appears to be a good argument. If the negotiator brings in many factors that you’ve not considered, ask for time to make your calculations and explore if these factors are true. It is not uncommon that you will find — with a little investigation — that nothing really changes the initial value your research found for an item.
Change your perspective
Cultures set the tone for money negotiations. For example, in many Middle Eastern societies, you may spend hours haggling over an inexpensive purchase, but you wouldn’t even say a word about money owed to you by friends or acquaintances. Similarly, women are less likely to handle money negotiations, which leave them less-than-skilled or prepared for situations where a male partner can’t be in their corner.
While the cultural aspects can’t be eliminated, their impact can be mitigated with knowledge. It is important to realise what is holding you back when it comes to money negotiations, and try to over it. When you realise where your discomfort comes from, you will find many ways that help to proactively address your shortcomings. By doing so you will be able to develop your own skills and help yourself achieve a sound sense of how to discuss money.
Rania Oteify, a former Gulf News Business Features Editor, is a Seattle-based editor.
