5 Tips to Negotiate the Best Pay Increase at Your Next Performance Review
If the current job market isn't depressing enough, the projected data regarding
pay raises in the coming year is even more dismal. According to the consultant
group Mercer, the average projected pay raise for 2013 comes in at just 3
percent, barely outpacing inflation. With that in mind, you're really going to
have to get to work, so to speak, if you expect any sort of significant salary
bump in the coming months.
Here are five tips that can put you in a better position:
1. Set Your Own Goals
and Achieve Them
Most companies set certain goals for their staff members.
However, if you really want to impact the raise you may get at your next
performance review, set your own benchmarks higher and work hard to achieve
them. By setting the bar higher than your organization, you can display to your
supervisor that you’re on the fast track to a successful career, deserving of a
2. Ask for an
Informal Review Now
If your next performance review is not due for a while,
request an informal assessment of your performance to date. Inquire about ways
to improve, as well as specific expectations your employer may have. If you
don’t know where the bar is set, your chances of reaching it are unlikely.
3. Do Your Research
If you’re not empowered with information, you may very well
sell yourself short. Check PayScale.com
to research the going salary in your industry and for your expertise level.
Don’t be afraid to utilize this research during the negotiation process.
4. Let Your Employer
Make the First Offer
As your performance review progresses, be sure to outline
your achievements and the benefits they’ve provided your organization. But when
it comes down to money, keep quiet – at least at first. It is important to hear
the figure you are offered before you respond with a counteroffer, as the
dollar figure offered might be much more (or less) than what you expected. In
salary negotiations, he who speaks first usually loses.
Once the negotiation process is done and you’ve received a
dollar amount, get it in writing. In some instances, a supervisor could offer a
raise, only to say after the fact that “HR won’t approve it.”
Regardless of your trust level in the company you work for, get any salary
increase offers in writing.
Once you’ve negotiated a satisfactory pay increase, it’s
time to figure out what you’re going to do with the extra money. There’s
nothing wrong with rewarding yourself with a purchase or two, but also consider
long-term investments. You can plan to devote a portion of the increase to your
retirement savings, or even use it to pay off your credit card debt. If you
have kids, consider establishing a college fund for them, or boosting
contributions if you already have one set up. It’s great to negotiate the best
raise you can, but it’s even more beneficial to use that money to reach your
David Bakke is a
contributor for the online resource, Money Crashers Personal Finance, where he shares tips for careers,
education, and retirement savings.
How do you plan on negotiating the best increase at your
next review? Let us know by leaving a comment below.
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(Photo Credit: JD Hancock/Flickr)