Five Ways to Prepare for a Salary Negotiation
Have you ever been offered a new job, a promotion or a salary increase and immediately thought, 'I wonder if I should be asking for more?'. If you've never negotiated your pay and weren't armed with research, you may be undervaluing your worth to a company. Getting underpaid early in your career can have a waterfall effect that leaves you lagging behind your colleagues. Read my 5 tips below on how to prepare for a salary negotiation.
1. Be realistic- This may be hard for some people to hear, because wouldn't it be nice if we all got 10% raises every year? Most companies will budget 3%-5% for annual raises. Essentially meaning, if you meet the expectations of your job, you should expect to see a small bump in salary perhaps between this range. If you have underperformed, your raise will likely be less. Still gunning for that 10% raise? You'll have to do more than just meet expectations.
Which leads me to my next point.
2. Know what's expected of you- Every company has a strategic set of goals. Hopefully, your company has communicated those with you. If not, then you need to speak up and ask your manager. Those goals can be broken down to an individual level so you can clearly see how your work impacts the overall success of the company. Usually, there are 3-5 individual goals you can set for yourself that will contribute directly to the main company objectives.
3. Know when to ask- It might seem like common sense to negotiate pay during your performance review but I advise actually bringing this conversation up in advance. Find out when your company holds annual performance reviews and request a meeting with your manager at least one month beforehand. If you wait until the day of the performance review to negotiate your pay, there's a chance you may not get it simply because the budget has been already been approved and finalized. This doesn't mean you have to be prepared to give your whole pitch or put your manager on the spot. It should be a conversation around planting the seed and getting on the same page in terms of your expectations.
4. Stick to the data- Be prepared with stats and data by knowing exactly what you should be making. There are a lot of websites out there that will give you a salary comparison or estimation. One of my personal favorites is Glassdoor's Salary Calculator. It not only takes your job title and location into consideration but other factors like level of education, years of experience in the industry and other compensation (like bonuses) you might be receiving.
5. Celebrate your wins- So much happens within a year timeframe. It's easy to forget all the projects you contributed to or the value you added to the company. That's why I recommend keeping track of your three biggest 'wins' every month. This can be in the form of a journal, excel spreadsheet or even a simple post it note. When review time comes around, you can easily look back and clearly articulate your contributionsn to the company.