10 Tips for Negotiating Salary
Get paid what you're worth with these tips for negotiating salary.
One of the stickiest parts of any interview with a potential employer is when the time comes to talk numbers. Maybe the salary discussion begins at the first interview, maybe it happens at the second, or maybe it's on the phone after your prospective employer has told you how much they're excited to have you on board.
No matter what point in the hiring process the salary negotiation comes, you need to be ready with a firm idea of how much you're worth, how much you'll accept, and what terms you'll entertain regarding how your salary is arranged.
Here are the top ten tips for negotiating salary to keep in mind so you know and get paid exactly what you're worth.
Understand the industry standard salary range.
For anyone just starting out in their career field, it may be easy to run into trouble trying to assess how much a reasonable starting salary should be. While you don't want to expect the bare minimum in pay, try to avoid shooting the moon also, since you may be lacking appropriate skills and experience.
One of the best ways to figure out what salary range you should be looking at is to hop offer to the Bureau of Labor Statistics website. This site will will give you a general idea of what others make in your industry given the region and individual years of experience.
From there, you can consult with colleagues who work in similar positions for different employers, as long as they feel comfortable divulging a ballpark number to you.
For those who have been working in the field a while, they may already have an idea of what kind of range a prospective employer is willing to move within when extending a job offer. The key for you will be to know what you're worth given your own skills and experience.
Know what you're worth.
You can't begin to negotiate a salary if you don't have a specific and fairly firm number in mind from the start. Before that number comes into view though, best practices mandate you sit down and collect all of your skills, qualifications, experience, expertise, and salary history on paper before you. Having all of your assets in front of you ensures you've got all of the knowledge at the forefront of your mind when assessing your worth.
Undervaluing yourself is one of the easiest ways to fall short of your money making potential. If you don't valuate yourself properly, no one will volunteer to do it for you. Come in with low expectations when it's time to sit down with a hiring manager, and you may walk away with a low salary.
If you know you're the type of person who tends to underestimate yourself, talk to a career coach for assistance in finding the right employers who may have more standardized career progression.
A major part of assessing your worth is taking factors into consideration such as the salary and compensation package at your last place of employment, and what you believe your colleagues or other professionals in the field are making with similar time and experience in the industry.
Justify your worth.
Coming prepared to this meeting is one of the smartest tactics you should use to negotiate your salary. It's one thing to know what you're worth. It's another thing justifying your worth to a prospective employer. You'll need to come prepared when the time comes to talk salary, whether that be by bringing past performance reviews with you, a more detailed résumé than the one that got your foot in the door, or a presentation highlighting your greatest attributes. Have these things in your back pocket to provide a hiring manager or interviewer if the conversation about salary gets into the weeds.
Realize what they're capable of.
Depending on your industry, the size of your potential employer, and the number of years they've been in business, you can get an idea of the type of salary range a company may be willing to offer. Salary offers that may be smaller with a new company, may be compensated with more perks in the compensation package, such as stock options, or yearly bonuses.
Larger companies may have the money to offer more, but they may also have very rigid standardized salary ranges that are dependent upon narrowly defined factors such as education, experience, and employment history.
Smaller companies may have more flexibility in the amount of money they're willing to pay a new hire, especially if they're seeking a particular type of talent. Newer companies may be strapped for cash, and offer generous amounts of vacation time or other non-salary incentives.
Find the flexibility.
Negotiating a salary or seeking a higher salary doesn't always have to come down to straight numbers. Even if a hiring manager is neither willing or able to offer the pay rate you want, feel free to explore other methods of compensation that can become part of your offer package. If an employer really wants you, they'll work with you as much as they can in sometimes unconventional ways. Finding the flexibility is one of the more important questions to ask before you take the job.
- Vacation—Though many companies have standardized vacation scales based on experience, there are some that have the flexibility to offer additional vacation days as part of a compensation package.
- Stock Options—Often smaller companies provide stock option incentives to attract potential employees. Stock options can pay off if you are the type of person who tends to stick with one employer for a while, and you work in a sector that is expected to grow.
- Bonuses—Particularly in sectors like government contracting, there are limits to what an employer can offer you in terms of salary. When this is the case, they may want to discuss providing one to two performance bonuses a year to serve as an augmentation to your salary.
Realize the value of medical insurance.
Depending on your age and your position in life, medical insurance coverage may or may not be that much of an attraction to a particular job. The cost of medical insurance can vary widely, depending on the type of plan a potential employer offers; and thus, can become a major perk of a compensation package.
Some plans require large co-pays and deductibles, while others are almost completely covered by employers. When assessing your value and your salary requirements, don't forget to take into consideration what you currently spend on medical insurance costs, and what you expect to pay in the future as you age and your life circumstances change.
If you have a family or are planning on having one in the next five years, the type of medical insurance a potential employer offers may become very important to you. If your significant other already has excellent insurance that also covers you, try exploring whether your prospective employer will waive coverage and put that savings into your salary instead.
Knowing what you're worth is not enough. Bringing all the documentation to prove your worth helps, but alone it may not do the trick. One of the tips for negotiating salary is that you must be able to have the conversation and answer the tough questions. If talking isn't your strong suit, then practice will be especially useful.
Before you sit down with a manager or interviewer, borrow a friend who can ask you the same questions you'd expect to be given when negotiation time comes. Have them throw a few tough ones in, too. Even if during game time the same questions aren't asked, they will have been similar enough to help you feel at ease, and have an honest self-promoting answer available that flows organically.
Beware the competing offer game.
Some companies don't mind having a conversation about whether or not you have a competing offer. They may be interested in knowing what that offer is and whether they can meet or exceed it.
Other companies on the other hand, don't enjoy playing that game at all. If you hand them an offer letter from another company, they may very well tell you to take it, which essentially ends any further negotiations that may have taken place.
A better way to negotiate a salary is by being genuine, and showcasing your talents and experience.
Dress to impress.
Whether you're looking to be hired on to a company, or you're renegotiating your existing salary, dressing smartly shows your employer or potential employer just how seriously you regard the position.
Even if the everyday work dress code is casual, you should treat the interview as if a suit or something equivalent is what you wear everyday at work. Being overdressed won't ever hurt you, but not dressing to impress certainly will.
Take a deep breath.
One of the most important tips for negotiating salary is to simply relax. When you're negotiating a salary and speaking to your best assets, your experience, qualifications, and reputation will do most of the speaking for you. It's quite alright to be nervous, especially when it comes to advocating for yourself. You've got this. If you come prepared, back your claims up with documentation, dress to impress, and know your industry, you may be surprised at how easy the process actually is.