We cannot overstate the significance of negotiating your salary; failure to do so has financial repercussions for individuals, families and businesses. If you leave thousands of dollars on the table because you chose not to negotiate, it will affect you for the rest of your life.
In many cases, employers at your next job will base your salary on your current or previous salary. It’s why you may still get asked about your salary history. Although this is frowned upon and, in some cases against the law, employers are gauging what it will take to get you into a new role, your salary expectations and requirements and whether they’ll be able to afford you. If you were underpaid in a previous position, chances are you’ll continue to be underpaid in the future.
Negotiating can be a daunting experience and even viewed as taboo as money is often an uncomfortable subject to discuss. However, negotiations will be a part of your future whether you’re building your career or established in one. It’s the start of a long-term relationship between you and a potential employer.
The key is having the confidence and skill to approach the subject to benefit both you and the organization for which you are or will be working. This three- or four-minute discussion could lead to a lifelong benefit you might not have been expecting.
Before You Negotiate
Before you negotiate, ask yourself this question: “have I done my homework?” If you enter into any conversation about salary, without doing a substantial amount of research, you may appear entitled or come across as uninformed about the reality of the industry. You are potentially setting yourself up for failure and for ruining your professional reputation.
- Research the company or organization
- Research salary trends
- Know your worth
- Have a realistic salary range
- Know your minimum
Experts say you should discuss salary:
When an employer makes you an official job offer
During the first interview
Traditionally salary discussions begin when an offer is made and you counter that offer. This is a more traditional form of approach and usually works well for entry-level or lower-paid positions. However, in an era of information transparency, it is acceptable to begin the salary conversation during the first interview (not when a hiring manager calls to schedule the interview). In most cases employers expect you to do so. It may be appropriate to ask at that point:
Can you tell me the salary range for this position?
By asking the salary range upfront you are letting the hiring manager know you’re interested in the position and you have a salary figure in mind.
When an Employer Initiates
If you feel more comfortable waiting until later in the hiring process to discuss salary, you still must be prepared to answer a question about your salary requirements if the employer initiates a salary discussion before making an offer. Two potential responses are outlined below.
Thank you for asking. Would you mind telling me the salary range for this position or similar positions within your organization? My requirements are negotiable and I’d like to consider those ranges before giving an exact number.
This example puts the question back on the employer to give you a range. Based on the salary figures the employer mentions, you can counter with your expected salary range in a more direct approach.
I want you to know I’m very interested in the position and believe I’d be a perfect fit for both the job and the company. I’m looking to make between $55,000 and $65,000
By using a more direct approach, you are giving your salary range while showing your interest and willingness to negotiate. Keep in mind the employer will see your given range as your ceiling and could try to negotiate down. Base your range on your research and never accept less than your minimum.
Responding to an Offer
When an employer extends an offer it is important to consider all aspects of the offer, including additional questions you may have.
When you receive an offer, express excitement and interest in the job and your desire to discuss salary and benefits.
Ask for Reasonable Time to Consider the Offer
Never accept an offer immediately. Thank the employer and ask for a reasonable amount of time to consider the offer, for example, 24 or 48 hours, and stick to it. Be sure to factor in holidays and weekends into your timeline. Inquire whether you can call back in case you have more questions. It’s usually better to promise a response before a specific time and date. Most employers expect you to take time to consider. This gives you time to review the offer in its entirety.
Get Your Offer in Writing
Whether your offer is initial or final, make sure you get the offer in writing before you commit. This way there can be no questions about everything that is included in the package.
Leave Emotions Out of It
Take time to make an informed decision, including the factors listed above. Consider asking a trusted mentor, family member or co-worker for advice. Then, gracefully, accept or decline the offer.
Think About the Entire Benefit Package
When considering an offer, think about the entire benefit package, not just base salary. Be prepared in advance with questions and focus on what will bring you greater value in the long term. It’s easier to negotiate nonsalary benefits. These could include:
- Commissions and bonuses
- Work schedule and/or telecommuting options
- Childcare benefits (access to programs or discounts)
- Commuting costs
- Paid time off (vacation, sick time)
- Insurance (health, dental, vision, life, disability, etc.)
- Retirement benefits or plans (401(k), pension, etc.)
- Tuition reimbursements and/or student loan repayment
- Equity in a company
- Wellness programs (gym memberships, etc.)
When asking for a raise, first make sure you are prepared to prove why you have earned it. Present your responsibilities and show how they’ve changed from when you started receiving your current salary. Articulate what more you could do or what other value-added duties would offset costs. Explain how these added duties justify a salary increase. Research what other people in similar positions are doing and make sure what you’re asking isn’t out of line.
An annual review after you have been in your current position for one year may be the time to ask for a raise. This is the most appropriate time, but after you’ve been in your current position for six months is also acceptable if you can show specific results.
Another opportunity is when you are given additional responsibilities. For example, your manager may ask for assistance on special projects. This opportunity could be a temporary one and a chance to gain more skills and demonstrate your value. If the additional role still requires you to perform existing tasks, you may say:
I would really be interested in taking this on, but it appears it is going to result in additional preparation work for me, which I am excited about. Is there an opportunity to discuss maybe getting additional pay for this particular work, because I am going to have to devote more time to make that happen?
Although it may just be a shift in responsibilities, it could also mean additional work. For example, your boss might ask you to train staff in addition to your regular duties. Can you argue that training staff involves prep time on the weekends or at night? You should ask yourself what it’s taking to do this additional work, compared to just doing your regular work in the past.
Salary Negotiation Tips
- Practice: Practicing boosts your confidence and helps you stay calm and consistent during negotiations
- Don't negotiate over text message: It is viewed as disrespectful and irresponsible and shows a disregard for the process
- Negotiate in good faith: This means only negotiate if you are seriously considering accepting the job
- Be clear: Be clear on the parts of the offer you would like to negotiate or improve upon. It shows you have considered all aspects of the offer, including what is important for you in your life and career
- Stick to your deadline: Always respond with your final decision before an agreed-upon deadline expires
- Don't use arbitrary numbers: Know why you’re asking for a specific salary and be able to defend it. It empowers you when you are having this discussion with the hiring manager
- Don't be timid: Learn to speak up and push your comfort level but be professional and courteous
- Avoid ultimatums: Never give ultimatums or threats
- Be patient: Delays are common during the negotiation phase. One way is to avoid this is to clarify from the beginning what the timeline will be and whether you can do anything to help move things along
- Don't be demanding: Be polite, professional, and respectful