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Preparing for salary negotiations

Want to get paid what you're worth -- and maybe a little extra? Prepare yourself for salary negotiations before you even get the job offer. Your fiscal future and happiness are riding on it.

When you get a job offer, you are in the catbird seat. It's your chance to be the sleazy car salesman. All right, skip the sleazy part since you'll have to work with the folks after the negotiation. Just remember you have the red convertible they want, in the form of skills, experience and talent.

Let's assume your future employers are nice, fair folks, offering a reasonable salary for the job. That doesn't mean they're always going to offer you the best salary for the job. It's up to you to make sure you sell your product at the price you want.

Yes, negotiating is scary. However, keep in mind that current low unemployment rates and a strong economy favor job seekers. The power lies on your side of the table. Going for a well-negotiated salary now will pay off for years to come -- not just in self-esteem and respect but in increased earning potential in the future. Your starting salary establishes the baseline.

"The higher the base, the higher the bonus or raise," says Jack O'Brien, the Fairfax, Va., author of Next Step: The Real World.

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Determine the numbers

At salary negotiations, if you seem to just pull numbers out of a hat -- "Gee, a hundred thou' would be nice" -- you'll look like a turkey.

"You're never going to get anything unreasonable," says Lee Miller, New York author of Get More Money on Your Next Job. "They're going to have second thoughts about hiring you."

Before the interview, research the job's salary range within the industry, and have an understanding of your value and your money needs.

"You start getting prepared before even going for the job," O'Brien says. "Anytime you are prepared, you are armed. If you're informed and have salary information, it's hard to argue against."

O'Brien suggests researching salary figures on the Web. He recommends three sites: Jobstar.org, wageweb.com and Jobweb.org. Additionally, "All industries have professional organizations. Go to that organization's Web site. They may have salary information."

Nowadays, younger employees are pretty open about discussing salaries, O'Brien says. You might actually get direct information from people at the target company or from those with similar jobs. This is where past networking can pay off.

Another tip is to ask for a copy of the job description from the potential employer. Sometimes this will list a salary range. At the very least, this will list needed skills and intended responsibilities, and you can use that information when you are comparing this position to other jobs and salary ranges.

Assess your worth
Now that you know what the position is worth, find out if you are worth it. Are you justified in asking for pay at the higher end of a salary range?

"If you have marketable skills and people skills, a combination of skills in demand, you're going to have a better chance to negotiate the salary you want," O'Brien says.

You'll probably need to back up your request with evidence of your experience, skills and future value for the company. O'Brien says, "Have some logic to base your request on."

You may not be able to "go for the gusto" when you are changing careers. Though your transferable skills are magnificent, you might not have the required experience. To get your foot in a new career door, you can negotiate above their first offer, but it could be difficult to be firm about getting the top dollar. It's one of those things you have to play by ear.

Finally, define the lowest salary you'll accept. Be firm in your demand. If it's not unreasonable, it should be met. If you accept less than you know you're worth, you'll start the job with feelings of resentment.

After all this research, you're ready to talk turkey, right? Not so fast. The timing is as vital as the preparations. That's correct; when that phone rings with an offer for your dream job, your wisest answer is "Hmmmm."

Hold on a sec'
He who hesitates is not lost when it comes to salary negotiations. Try not to discuss salary before the job is offered. The name of the game here is to delay tactfully.

"The best analogy: The salesman tries to get you in the car and drive the car. You're sitting in a red convertible, thinking 'Maybe a few more bucks each month isn't so bad,'" Miller says. "Like dating, you want the person to fall in love with you first. Get them to offer you the job."

Your bargaining power doesn't come until this employer is in love with you and offering their hand in ... employment. That's when you go for the goods. Stave off money discussions until you're ready:

  • If the employer mentions a figure or a range early in the interview process, don't agree to anything. You could say the mentioned salary falls into the range you are willing to consider, then return to discussing the job.
  • An up-front way to avoid talking money too early, Miller says, is to say "It's too early to talk about money. If I'm right for the job and it's the right job for me, then we can talk salary."
  • Try not to be the one who mentions a number first. If you are asked to name a salary, say, "What range do you think would be appropriate for this position?" If they push it, you can always fall back on a well-researched number.
  • OK, they've offered you the job. They want you. And you want them -- but don't say yes immediately. Always ask for time to think it over. Even if it's a really good salary, don't jump on anything.
  • Even if you agree to the job, don't say yes to that first salary offer. You've done your research, you know what the job is worth and you know what you are worth. Even if the offer falls at the top end of an appropriate range, this is your chance to get a couple extra nickels out of them.

Strategy is key
Honesty remains the best policy, even in negotiations.

"The good thing about telling the truth is you don't have to remember what you said," O'Brien says. This doesn't mean, however, that you have to reveal everything. Be honest to your advantage. Their uncertainty is a good thing.

Also keep in mind that more than likely you are negotiating with your future boss. Don't treat him or her like you would your stereotypical sleazy car salesman. You have to work with this person later. Establish a tone of respect and tact now.

More to life than money

A nice, cushy, enviable salary is always nice, but there can be limits to what the new employer can offer. Be fair and objective. Understand that there are budget limits and potential colleague envy. With that in mind, offer other solutions that allow them to give you a share of the wealth, since you're worth it:

  • Salary review -- If the starting salary isn't quite up to snuff, try negotiating on your salary review. Some of the issues you can address now are how soon, how often and how big a percentage you may get.
  • Bonuses -- If you're in an industry that regularly gives bonuses based on salary, see if you can get a larger percentage if you aren't getting a larger base. Or, if your industry doesn't normally give bonuses, see if you can work out a performance goal that would be fiscally rewarded down the line.

Long-term benefits -- Popular methods for long-term reward include profit sharing and stock options. You could make a tidy little profit if the company does really well, and part of your new job could be to make sure it does.

For most people, money isn't everything. When discussing fair compensation for your excellent skills, be sure to bring up benefits. Generally, benefits cost the company 30 percent to 40 percent of your salary. When it comes to benefits, companies are very flexible, O'Brien says. Many have a cafeteria plan, which gives you the opportunity to choose benefits.

  • Income boosters/savers -- Another way to make more money is to spend less. If you can get the company to pay for things that are priorities for you, then you'll come out ahead. Consider education reimbursements, premium insurance, child care assistance or relocation assistance. Some of these may already be benefits at the company, but you can ask for more of them or better options.
  • Perks -- Miller recommends talking about extras such as a company car or a laptop computer; ways to do your job better.
  • Schedule -- If flexibility is a priority to you, find out whether you can telecommute from home a couple of days a week, or whether you can set your own hours. This may not fatten your wallet, but it gives you more control over your life.
  • Vacation -- Another quality-of-life benefit is time off. This one can be tricky to negotiate because, if you're not careful, you could end up looking less committed to the job if you're focused on how much time you'll be spending away from the office. Miller suggests keeping negotiations about vacation time to the end of the process. "If they've got the flexibility, they'll give it. As long as it's reasonable."

 
-- Updated: May 10, 2004
     

 

 
 
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