Negotiating your salary is hard, but not because the act itself is difficult. If you’re proficient enough at your job for somebody to want to hire you, you have all the skills necessary to ask for the compensation you deserve. The real challenge in salary negotiation is overcoming the fear that holds you back. That’s why it’s so important to understand your personal answer to the question, “should I negotiate salary?” If you are clear about the reason WHY you should do the thing that scares you, you’re much more likely to take action.
Money Isn’t Enough
The truth is, money alone is rarely enough of a motivating factor to get people to negotiate. In fact, only 43 percent of PayScale users say they have ever asked for a raise. That may not seem like a huge minority, but remember that that isn’t the general population – that’s exclusively people who visit PayScale.com to find out if they are being underpaid, which is a sign that this population is already thinking about their salary in a proactive way. So what’s stopping them from asking?
Usually, it’s because even though money is nice to have, it’s not enough of a reason to overcome the fears associated with salary negotiation. A $5,000 raise sounds awesome, but when you subtract taxes, and break it down into a single paycheck, that’s’ only around $250 a month. And depending on your financial needs, that may not be enough to move the needle.
So if you really want to make more money, don’t focus on a single paycheck. You have to think bigger – think about WHY negotiating your salary and earning your market worth matters to you. There is no right or wrong. Your WHY can manifest itself in a thousand ways. But you have to start with a macro lens and think big.
Let’s go back to the example of a $5,000 raise. If we break it down to a single paycheck, it’s not really that much. But if we look at the bigger picture, the value grows. Remember that each salary acts as a benchmark for your future earning potential. According to Fast Company, a 25-year-old who is offered a salary of $50,000 and negotiates it to $55,000 will earn $634,000 more over 20 years.
Six hundred and thirty-four thousand dollars is a lot more than $250. It’s enough to take a sabbatical and travel the world, enough to send your kids to the private school of your choice or pay for their college education, or enough to buy a house in almost every city in the United States. If you focus on the lifetime earning potential of your next salary negotiation, and you have a goal for what to do with that extra money, you’re much more likely to actually negotiate.
Think Outside the Box
But salary negotiation can be about more than just money. When you negotiate for the salary you deserve, you aren’t just asking for a bigger paycheck. You are advocating for yourself and showing your employer that you have done the research to understand your worth in the labor market. You are living the idea of pay transparency – that employees and employers should both be able to understand how and why pay is assigned the way it is.
To me, the most meaningful part of salary negotiation is that, ultimately, you are standing up for everybody you work with. When employees negotiate, they don’t just force their employer to think about how they are individually paid. They force their employer to reexamine their entire compensation strategy. Every time one person negotiates in a data-driven, non-adversarial manner that results in both parties walking away with a better understanding of pay, that person makes salary negotiation a more normal behavior. And that makes it easier for everybody to earn the salary they deserve.
For me, that’s the number one reason why I negotiate my salary regularly. Before I came to PayScale, I spent far too many years letting my fear of being seen as confrontational or greedy keep my from earning a fair salary. As a natural-born people pleaser, I was more concerned with offending a recruiter or manager than I was with my finances. But once I understood how important it was to talk about salary in a transparent manner, I changed my ways. As a result, I’ve increased my earning power and, more importantly, been able to help lots of other people earn the salary that they deserve.
What’s Your WHY?
Knowing why you want to negotiate is just as important as knowing how much you should be asking for. So once you’ve taken the PayScale Salary Survey and figured out how much you should be paid, spend some time thinking about WHY you want it. Then, if you start second-guessing yourself, remember your why. And negotiate!