Your first salary matters more than you think. While sure, you might be happy to land any job that uses your degree, you still need to negotiate your first salary – because it has long-term impacts on your future earnings.
Let’s say you’re offered a starting salary of $50,000, but you negotiate it up to $55,000 like a boss. That might not seem like a major win, but according to a study in the Journal of Organizational Behaviour, you just scored yourself an extra $500,000 in lifetime earnings over a 40-year career.
Yeah. That’s the power of negotiating your first salary. Not only do you earn that extra money in your first year, you’ll probably continue earning it, and as you get raises, they’ll be based on a higher salary. Those gains can add up to a cool half a million dollars over the course of your career.
So OK, you’re sold on the fact that you need to negotiate your first salary. The next step is the hard part: the How.
How to bring it up – and when
Once you’re on board the salary-negotiation train, it can be tempting to want to jump right in and ask “HOW MUCH THO?” in your first call with the HR department.
Let me just say this for the record: don’t do that.
In fact, you’re almost always better off to let the employer take the lead. As much as yes, what you’ll get paid is a crucial piece of information, hold off on asking about it until they bring it up. It’s silly, but some people are still weird about talking salary, even on the other side of the table.
Beyond that, whenever possible you should make them name a number first. If they throw out a question like “So, how much are you looking for in terms of salary?” you’ll be in a much stronger position to negotiate if they give you a hard number first. Try the following line in a pinch – it’s always worked for me.
“Honestly, I’m really interested in the role, and it seems like a great fit for my current experience and where I’d like to grow in my career. I’d love to hear what the salary range is for the position, as part of the total compensation package.”
The ball’s back in their court, especially since that “total compensation package” is something they have all the details on – and wouldn’t expect you to know anything about in the first place. That’s all the extra stuff, like their healthcare plan, commuter plan, 401(k)’s and the associated office perks.
Be prepared and know your numbers
Once they’ve given you a solid number – you savvy negotiator, you – the ball is back in your court to either accept it or negotiate. To make sure you’re ready for either situation, there are two numbers you need to know: the market rate for the job you want and your minimum acceptable salary.
What’s the market rate for this type of job?
Do some digging on sites like Glassdoor and LinkedIn’s new Salary Tool to find out what people make in your area when they have this particular job. This is the most important number you can know going into any kind of salary conversation, and will help you figure out if they’re offering a competitive salary – and when to ask for more if their first number isn’t even close.
What’s your minimum acceptable salary?
If you really want the job, either for the experience or just for a change from your current role, it’s also useful to know what your “minimum number” is before the questions are asked.
To figure it out, look at a combination of your current expenses, your current salary and your current goals – but don’t forget to consider what amount will make you feel like you’re being paid fairly. If you feel like you’re being underpaid, you won’t be happy long-term.
It’s about the money … but it’s also not about the money
If you’re in a negotiation, and you get a hard “No” on additional dollars for your role, just remember that your salary is just one part of the total compensation you get from your employer. There are a whole whackload of other perks employers can offer you beyond money, including…
- Vacation days
- Flexible schedules
- Healthcare benefits
- Student loan repayment
- Stock options
- Alternative benefits (from volunteer days to kegs in the office)
If you know you have a solid case for asking for more money, based on your experience and the market rate for the job, don’t be afraid to ask for other perks if they really can’t budge on the salary side. You’re worth it, as you know, and if being able to work from home sometimes will make up for a few less dollars per year? Ask away.
The only time you shouldn’t negotiate
Ok, anti-negotiation friends, here is the free pass you’ve always wanted. If you’ve done all of this work to prepare for a negotiation, and you know the relevant data about how much jobs like this usually pay, here is the only case in which you can (maybe) take a pass on asking for more.
If your future employer hits you with a salary number that’s above the market rate for the job, and well above what you had hoped for in the role, you have my full permission not to ask for more. If this happens, it’s likely that they know they’re offering a competitive salary, and they’ll assume you know it, too. Trying to angle for more in this one, specific case isn’t necessary, and it could even backfire.
But um, if you find yourself in this situation, can you let us know? Because it hasn’t happened to me yet. In every other situation with employers who aren’t throwing extra money at you, negotiation is the name of the game.
Yes, even for your very first job.
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