If you answered no, you’re in good company: 57 percent of respondents to our survey said they’d never negotiated salary in their current field. But on the other hand, negotiating is worth it: 75 percent of those who asked received a pay increase.
And not negotiating can cost you — to the tune of $1 million or more over the course of your career. Why? Because when you negotiate a raise, you’re not just negotiating this year’s pay. You’re also negotiating the starting point for next year’s raise. Most organizations give pay increases as a percentage of base pay.
Plus, many hiring managers still ask for salary history when negotiating an offer. (Even though that doesn’t really make sense for them or for you.) Take less now, and you could be locked into a lower salary for the rest of your career.
Still nervous about negotiating? Preparation is the key. Here’s what to do before you ask for what you deserve:
The most important part of salary negotiation is the research phase. If you’re like most people, you probably set your salary request based on what you hear — from your friends, coworkers — and what you need.
The problem with basing your request on what friends and coworkers say is that you have no way of knowing whether they’re stretching the truth. And even if they’re being honest, there might be reasons why they’re making more (certifications, for example, or more experience in an area you lack).
Basing salary on your financial needs is also a mistake. For one thing, it’s irrelevant: salary negotiation is about what the market will bear. You might also wind up low-balling yourself if it turns out that your skills are worth more than you think.
Instead, come up with a salary range based on data. In less than five minutes, the PayScale Salary Survey gives you a range taking into account your skills, experience, education and location. The results are based on anonymous surveys from thousands of people in your field, so you’ll get an accurate salary report to take with you into negotiations.
Here’s a quiz for you. When is the right time to take less than market rate for your services?
The answer is E. The fact is, everyone’s priorities and circumstances are different. You might value stellar health insurance or more paid time off more than a fatter paycheck. Or you might be looking at your six month of unemployment and be getting antsy to fill that space on your resume. Or you might have enough savings to say, “Thanks, but no thanks” to offers that come in under your requirements.
The bottom line is that only you know what’s important to you. Figuring out your priorities ahead of time is essential to a successful negotiation. Remember that you’re the one who has to live with the results.
Over the course of your career, you’ll make more money if you negotiate when you’re offered a new job. But that doesn’t mean that every negotiation will be successful.
Before you ask for more, have a plan for what you’ll do if they say no, or counter-offer for less than you were hoping. How much less are you willing to take, and what will you do instead if you decide to walk away?
If you already have a job, you could just stay put and look for other, more lucrative opportunities. If you’re unemployed, but disinclined to take a low-ball offer, you might be able to freelance or do contract work until you find a better fit. Having a plan in place will also help ensure that you’re negotiating from a position of strength.
Want more advice on salary negotiation strategy? Read PayScale’s Salary Negotiation Guide.
This article originally appeared on PayScale.
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