Whether you’re applying for a new position or trying to score a raise at your current job, knowing how to negotiate your salary is a crucial part of being in the workforce. Unfortunately, many employees make the mistake of accepting a wage that’s lower than they should — or, worse, neglect to negotiate their salaries at all.
“Salary negotiation is about the value you bring to an organization — your talent, skills and contributions — not what’s ‘fair,'” said Lisa Skeete Tatum, CEO and co-founder of Landit, a career resource for women. “Aim high and be rewarded for what you’re worth.”
Here are seven tips for how to negotiate a higher salary at your current position — and any jobs you’ll hold in the future. And as you go forward, make sure you increase your salary and skills regularly.
1. Know the Average Starting Salary for the Position
Whether you’re applying for a new job or preparing for a salary negotiation in your current position, it’s important to know what the median salary is for your field. Be sure to differentiate between factors like the average starting salary for college graduates versus those with experience.
“Do your research,” said Laura MacLeod, LMSW, of the From The Inside Out Project, a program that fosters interpersonal skills. “That means finding others doing the same job and finding out what they make. Is their education, expertise, and years of experience similar to yours? You’ll need this information to negotiate using facts.”
You can go a step further, according to Carla Dearing, CEO of SUM180, a financial planning website. “One of the best things you can do to gather information is to interview as much as possible, even for jobs you don’t want,” she said.
“Use informational interviews to gather targeted salary information,” said Dearing. “Take the opportunity to learn as much as you can during these interviews. Use all the feedback you get to form a clearer picture of the industry and positions similar to yours. You’ll be knowledgeable, relaxed and armed with real information,” said Dearing.
2. Deflect the Starting Salary Requirement Question
Even though you’re at a job interview, you should view it as a card game when it comes to sharing information about your required salary, said Denise Dudley, author of the book “Work It! Get In, Get Noticed, Get Promoted.”
If you feel that you must state a number, Peter Yang, co-founder of the resume-writing service ResumeGo, said, “Make a high first offer.”
“Some people are hesitant to propose a large salary because they’re afraid that it’ll look ridiculous,” said Yang. “In reality, there is no downside to this, and starting off the discussion with a large number often deters your future employer from lowballing you or proposing a figure that is significantly smaller than your original proposal.”
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3. Focus on What You Bring to the Job
By delaying a discussion of money, you can focus on selling yourself to potential employers or reminding your current one why you should be on the staff. If you’re interviewing, show what’s in it for the company if you’re hired.
“Quantify your potential contribution to the bottom line,” said Yang. “Show that you deserve the salary you’re asking for by helping the firm understand how much you can increase their profits and lower their costs.”
Companies want to know specifics, said Yang. “Do this by giving quantifiable examples of how you drove revenue, boosted sales, improved efficiency and decreased overhead at your previous jobs.”
4. Prepare Your Pitch for the Salary Negotiation
Researching the market rate for the position you want will help you avoid asking for a salary that’s lower than what you can get, said Tatum. But that doesn’t mean you should offer a single number.
Instead, give your current or potential employer a low and high range of the amount you hope to receive. “Oftentimes, a company will come back and offer something in the middle,” said Dearing.
Once you’ve settled on a salary range, practice your pitch. You want to be friendly but assertive, said Kathy Downs, senior vice president of the staffing service Robert Half International. So test out what you plan to say.
“If you sound awkward in front of a mirror at home, that’s probably how it’s going to come across when you sit down at the table to actually negotiate,” said Downs.
Whether you’re negotiating a starting salary or lobbying for a raise, it’s a good idea to practice what you’re going to say with a friend. Or, work with a specialized staffing professional who is trained on how to have those tough conversations, said Downs.
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5. Be Ready to Make a Counteroffer for Your Starting Salary
Knowing how to negotiate salary after you get a job offer is just as important as knowing how to do it in the earlier stages of the hiring process. If the average starting salary is lower than what you’re offered, or if you believe that you’re worth more, negotiate.
Before you launch into your counteroffer, respond to the initial offer with gratitude and empathy, said MacLeod. “Use your smile to keep the exchange professional and in your control. If the offer is way off what you feel is right, take a breath before responding. You want to eliminate any trace of resentment or frustration,” said MacLeod.
Once you’re ready, prepare the other person for your counteroffer by saying, “I really appreciate your offer. As you know, I’m very interested in working for you, but I’d like to discuss the salary,” said MacLeod. You can then go on to present the facts and why you’re worth more, she said.
Keep in mind that the base amount of the average starting salary is not your take-home pay, said Dudley. “You have to remember that you will have taxes, insurance and all sorts of other potential requirements that will eat away at that salary number — and you can definitely use this as a negotiation point. There’s nothing wrong with explaining to the recruiter that, after taxes, insurance, and other factors, your take-home pay won’t actually cover the median cost-of-living requirements of your local area,” she said.
“There are actually some excellent cost-of-living calculators — and they’re free — out there on the internet, and it’s a good idea to check out what your take-home pay looks like before you accept the position,” said Dudley. “It’s possible that by explaining deduction realities, you just might nudge the base up by a few dollars — and every little bit counts toward a victorious negotiation.”
6. Consider the Starting Salary as Just One Part of the Compensation Package
Look beyond just the dollars and sense when considering how to negotiate the starting salary, said Yang. “Although higher financial compensation is what you’re primarily fighting for, sometimes it can be difficult for an employer to give you the salary you want,” he said.
“In these situations, remember that there are other items on the table up for negotiation as well,” he added. “If your employer can’t offer you the salary you are hoping for, you can often still get them to budge on things such as vacation time, work schedule flexibility and tuition reimbursement.”
Flexible work options are valuable, too, according to Brie Reynolds senior career specialist with Flexjobs, a job recruiting website. Even the highest starting salary jobs have room for negotiation in this area.
“If you’re able to work remotely one day a week, you’ll cut your commuting costs by 20 percent instantly,” she said. “You’ll also save on wardrobe maintenance, buying food and coffee outside the house, and you’ll gain back more time.”
“Forty-three percent of U.S. workers work from home on occasion, so it’s a common practice and one you should feel confident asking about during your negotiation,” added Reynolds. “And if you work from home full-time, you can save an average of $4,600 per year.”
7. Discuss Opportunities for Growth
If an employer isn’t willing to pay you what you want, take a long-term approach to getting the compensation package you want, said Dearing. That is, work out a plan to earn a raise in the future. “The more specific the plan, the better,” she said.
For example, say that you understand what the starting salary is but that you’re qualified to earn more and have a lot to offer the company. Say you would like the opportunity to reach specific goals and have your salary reviewed after six months, said Dearing. “Once you meet the agreed-upon goals, your boss will find it very difficult to refuse you the raise you’ve demonstrated you deserve,” she said.
As you prepare to implement these tips on how to negotiate a salary offer, begin by looking within, said Dudley. “Breathe, calm your mind and remember that this is not necessarily an adversarial situation,” she said. “In fact, nothing prevents a salary negotiation from being a positive and successful interaction for both parties.”
“Think of it this way: The recruiter, assuming she represents an ethical company, wants to hire you at a fair and reasonable starting salary,” she said. “And you, the prospective employee, want to be compensated at a rate that’s commensurate with your skill, education, and experience levels. In reality, you’re both on the same side, so start with a cooperative attitude.”
There’s nothing wrong with showing a little enthusiasm, according to Dudley. “Behave and speak as if you believe your salary negotiation is going to be a pleasant, successful endeavor — and it just might turn out that way,” she said.
About the Author
Barb Nefer has been writing professionally for nearly 30 years, cutting her teeth as a news writer for the Daily Southtown in Chicago. She’s a doctor of psychology, and her eclectic expertise includes personal finance, psychology, travel and the pet industry. Her work reflects that diversity, with pieces appearing in places like About.com, CBS Local, Yahoo.com, WebPsychology, and Animal Wellness magazine.