How a Round Number Could Tank Your Raise

How a Round Number Could Tank Your Raise

When it comes to negotiating our salary, we could use all the insight we can get.

We know to use sites like PayScale and Glassdoor to research appropriate compensation for our position, we know to ask for more than we expect to get (planning to be negotiated down) and we know that if our employer can't or won't increase our salary, we can try and negotiate other benefits, like vacation days.

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What we haven't heard before, however, is that we should avoid asking for round numbers.

Research from Columbia Business School found that using very specific numbers (for instance, $5,634 instead of $5,500) results in a higher salary increase. The Wall Street Journal explains that citing precise numbers gives the impression that you've done extensive research and know exactly what you're worth. Round numbers, on the other hand, convey that you only have a vague idea of what you should be earning—which isn't all that persuasive to your boss.

In fact, the research found that throwing out a number that's a little high and very precise yields better results than a number that's high but imprecise. One experiment, where participants negotiated the price for a car, found that buyers suggesting a round number paid an average of $2,963 more than they initially planned, while buyers who gave an exact number paid an average of only $2,256 more.

The study's author recommends opening negotiations with a number that's higher than you expect to get, but not too much higher, and extremely specific.

At our next review, we're asking for $7,779.

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