5 Tips to Negotiating a Better Salary
The negotiation of a salary increase is a tense process. Everyone prepares for the application process, the follow-ups and the interviews. There are thousands of articles written on how to leverage charm and knowledge to nail an interview. The truly difficult part is once you've received the job offer and it's time to negotiate a salary.
Most companies are prepared to negotiate with new hires. It's rare that asking to negotiate will cause an immediate threat of not getting the job -- after all, if you've passed the interview process, they company clearly wants you. Of course, you always have the option to step away, but unless you have a backup job offer, it's not a route you should be willing to take.
That said, you should always negotiate your salary if you can. Say that you and a second person both receive a job offer with a salary of $50,000 a year. That other person takes it, and you negotiate it up to $55,000 a year. Assuming you both receive the same bonuses and increases over the course of a 40-year career, you would end up making over $600,000 more than the other person makes. That's a very significant increase in long-term income compared to a relatively minor increase in yearly starting salary.
Here are five tips to help you negotiate a better salary.
1: Keep things tangible. When you're discussing your previous work experience, don't just say that you increased productivity. Tell them you increased productivity by 25 percent in your position. If you have experience in the position you're applying for, tell them exactly what that experience is. The key is to show them tangible benefits and results you can achieve. This gives your employer a more favorable outlook on your prospects working for them, and makes them more inclined to pay you a little extra.
Keeping things tangible also has the benefit of showing that you know specifically what you're talking about, and you're not just riding on buzzwords to get you through the interview and into a stable position. It helps to do some research beforehand. Know what the salary range is for your position, so you know if you're being offered more than normal or you're asking more than they're willing to go.
2: Have a valid reason for asking for a higher salary. Whether you're negotiating a starting salary or renegotiating for a higher one, you need to have a tangible reason why. Keep your personal life out of it. How much you're paid depends entirely on the quality of your work, the competition for your position, and what the company budget limit is. The budget office doesn't know or care if your pet needs surgery or you're saving up for that new big screen TV.
If you legitimately cannot cover your living expenses on the proposed salary, say so. If you need to hunt for a second job to cover your expenses, both you and your company suffer from a lack of focus and dedication. If you're up-front about it, the company may find you valuable enough to keep despite the necessity of a higher salary.
3: Be prepared for alternatives. On one hand, the employer can always simply say no. You need to be prepared for such an answer, and be ready to ask about non-monetary compensation alternatives. Some companies may offer some stock options as a side benefit, or some form of additional benefits. In some cases, you may even be able to negotiate special circumstances, like working a day or two from home per week.
One thing you may be able to negotiate for is more frequent performance reviews. If you're being reviewed every three or six months instead of every twelve, you have more opportunities for your employer to see your point of view, as well as more chances for salary increases.
4: Don't overestimate yourself. While you may be highly qualified for the job, that doesn't mean you're the only option they have on the table. You may want to demand a higher salary because of your skills and experience, but someone with similar skills and experience may be willing to accept a lower offer. Know exactly where you stand, and know when to accept a lower offer.
No matter what, don't be arrogant. Polite gratitude first and last is the key to successful relations with any employer. Even if you're bargaining from a position of power, you still need to keep your employer happy. The more polite you are, the less likely they are to turn you out on your ear or deny your request for a higher salary.
5: Have a backup plan. You need to calculate the minimum salary you need to survive, and if your job simply won't cover it, you need to be able to find a way. Whether that means a second job with another interview and salary negotiation, which may be just what you need to do. You never need to accept an offer that's too low for you, and you should always be prepared to walk away. If you're qualified enough, the threat of leaving may just be the incentive the company needs to give you that last small hike. On the other hand, they may have other applicants waiting in the wings, and can fill your spot quickly. That's where the backup plan comes in.