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8 Tips for Negotiating Your Salary

My iFinPlan: Know how to negotiate your salary the proper way with helpful tips

You’re newly out there looking for a job or maybe you’re going a new position with a new company. Either way, you know that you have bills to pay and you know what the average salary is. The key to any salary situation is negotiation.

Negotiation is a skill set that most individuals must master in this day and age and I’m not talking about negotiating at the sales table – unless you’re the one buying that shiny new product. Companies are looking for intelligent, skillful employees who are able to work for the least amount of money. All companies do it for the same reason – to help them improve their bottom line while improving their company.

“37% of people always negotiate salary while 44% say they negotiate occasionally.” — Salary.com

This is very surprising considering that studies have shown that an employee who does not negotiate a first salary will most likely miss out on MORE than $500,000 by age 60. Now, we have a good idea of why most of us will still be working until we’re in our 70’s. By the time individuals in their 20’s go to retire they will need to have a couple of million dollars in the bank on top of a couple of retirement accounts to be able to even think of retirement in their 60’s. That $500,000 that you just lost on your first salary could be the make or break moment that you needed to be able to make your retirement happen earlier.My iFinPlan: Don't let someone talk you out of knowing what you're worth

When you go to sit down for your first interview most companies are expecting a job candidate to negotiate, so it can’t hurt you to respectfully negotiate for a higher salary. You are the only one that you have on your team while at the negotiating table and you are the only one who can try to achieve a higher salary. If you don’t try to achieve a higher salary who will?

By using these tips you should be able to achieve a higher salary and be able to add more money to your retirement accounts so that you are able to retire at a younger age. We know that negotiating is tough and it is often unpleasant work. It is also necessary if you want to be paid fairly, get a raise, or attain that new promotion. You have to overcome your fear to be able to get the salary that you want to get. This also shows the recruiter or hiring manager that you have self-confidence and that you know what you are worth. Negotiating rarely comes across as greedy if you do your research and get the proper ranges of salaries. Every negotiation for a salary makes a difference and it makes a difference in the short-term and the long-term. Some companies will lead you to believe that negotiation isn’t possible but negotiating is always possible and if they want the talent that you have they will have to negotiate to achieve it.

Remember These 8 Tips

 1. Talk to Recruiters/Hiring Managers

Make sure you take calls from recruiters and hiring managers. They know what individuals with your experience and expertise are worth and what companies are willing to pay for an individual like you. You may not ever get a specific number, but you will be able to find out a range and that is helpful.

2. Know Your Value

If you’re going to get the pay you deserve, it’s crucial to know the going rate for your position in your specific industry and in your geographical area. You can do this by doing an online research on sites such as Payscale or Glassdoor. You can also do this by asking others in your field (ideally both men and women) – to avoid falling victim to the gender pay gap.

3. Pick the Top of the Range

As you’re talking to recruiters and looking around sites like Payscale, you’ll be able to come up with a range that represents your value. This isn’t the time to be shy and ask for a salary around the middle range, but instead you should ask for something toward the top. Always assume that you’re entitled to top pay and your employer is always going to negotiate you down. You are going to need the extra wiggle room to be able to get a salary that you are satisfied with.

4. Be Willing to Walk Away

When considering your salary and the negotation, you should come up with a “walk away point” – an offer low enough that you will turn it down. This could be based on financial need or market value. Be reasonable with yourself and don’t let your ego get in the way of a salary and your dream job.

5. Have a Backup Plan

Make sure that you do your research and put in resumes to a few companies while negotiating for a new position or sitting with your HR manager for a promotion. This affords you the ability to be able to walk away if you need to – you have two other positions that you have already negotiated salaries for.

6. Brag Sheet

Some individuals refer to this as a brag sheet and other’s refer to this as a one-page summary. Essentially, the digital version of this is in reference to LinkedIn. On this sheet you are going to want to list any accomplishments, awards, and customer or co-worker testimonials. The idea is to show how awesome you are as an employee and to demonstrate to upper management how much of an asset you are to the company.

7. Set the Meeting for End of Week

You always want to set a meeting for the end of the week. Thursdays and Fridays find us most open to negotiation and compromise because we want to finish our work before the week is out. Monday and Tuesday are always bad days for negotiation meetings because the week has just begun and the focus is on getting other things done. They aren’t going to pay too much attention to what you have to say or how much you deserve a raise.

8. Future Focused

When you are negotiating salary for a new job, it is very common for the recruiter or hiring manager to ask about your current salary. This is a tricky situation, especially if you’re being underpaid or needing to make more money for personal reasons. When you are asked about your currently salary you should quickly move the conversation forward to explain the number you’re looking for. This helps to focus on your new skills or responsibilities, your value to the company, and how you’re looking to grow with the company.