“If you know what you’re worth, then go out and get what you’re worth.” -Rocky Balboa
The above statement should be the mantra of every professional.
It should be your guiding light during every interview conversation you have. From your first job to your last, knowing what your talents are worth will quickly give you the upper hand when it comes to salary negotiations.
A recent study in the Journal of Organizational Behavior found a direct relationship between your very first salary negotiation and your expected lifetime income:
Starting salary inequities can have a compounding effect on individuals’ career earnings. For example, assuming a 5% pay increase each year over a 40 year career, a 25-year-old employee that starts at $50,000 would earn $634,198 less than an employee starting at $55,000 by the time s/he reached the age of 65.
With a difference like that, it’s in your best interest to negotiate every salary amount you’re offered, no matter the position. And even though the salary negotiation is often one of the most dreaded parts of an interview, it’s also where the greatest opportunity lies.
I won’t pretend to speak for everyone, but for me, I go to work for the income. If (in my perfect world) I won the lottery, I probably wouldn’t keep working in the same manner as I do today, regardless of how passionate I was about my job.
And whether you’ve been out of work for a while or are simply desperate to get out of your current situation, salary is a huge factor when it comes to accepting a job.
So why, then, is it so hard for people to ask for and get what they think they’re truly worth? According to the study:
…receiving less than satisfactory outcomes reduces perceptions of fairness, which produce beliefs that one is not being compensated appropriately for contributions they bring to an organization.
There is no reason to settle for an income that isn’t on par with your value, no matter how desperate you are. (Like this thought? Tweet it!)
By simply asking for what you’re worth, you in fact increase your value. Asking shows that you’ve done your research and know what your value is in the market. It also shows confidence in yourself, which any employer will appreciate.
Before your next salary negotiation, I want you to understand the three things below. They are the stepping stones to earning exactly what you’re worth (if not more).
Your Perceived Value Of You
What would you say if I told you that you’re worth a million bucks?
Would you believe me, or would you doubt the statement? Before you decide, let me give you some quick calculations. (I’m going to throw around the word “average” a lot, so bare with me. I’m trying to appeal to the masses here.)
Let’s say you made $25,000 (which is well below the average household income today) and worked for 40 years, which is the average expected work life (from age 25 to 65).
$25,000 x 40 years = $1,000,000
Keep in mind that this number is assuming that during those 40 years, you never received a raise, bonus, commission, tax refund, lottery win or birthday gift from grandma.
So, what do you think now? Do you think you’re worth $1,000,000, or do you think you’re worth more?
I think you’re worth way more, so it’s my strong opinion that you should think the same. How much more is the question to ask yourself.
To find that number, you’ll have to do your research. The number will vary by your education level, the city or state you’re working in, your experience level, your skill set and your overall presentation before, during and after the interview.
An Employer’s Perceived Value Of You
If the first step is understanding what you think you’re worth, the second is understanding what your future employer thinks you’re worth.
This knowledge will again come from doing your due diligence to find out what they’re willing to pay for your skill set. Keep in mind this amount may be lower or higher than what your perceived value is.
You’ll want to be more focused on that specific company and that specific job opening. Some questions to ask that will help you understand their perceived value of you are:
- Why is this position vacant?
- How long have they been trying to fill this position?
- What skills do you have that the last person didn’t?
- What makes you unique compared to other applicants?
- How well do you fit with the company culture?
These will help you determine how eager the company is to fill the position. The more eager they are, the more value you have as the right fit.
You’ll Never Get What You Don’t Ask For
I remember when my wife was interviewing for a promotion within her company. She was deliberating as to whether to accept the initial offer. She had a number in mind that she wanted, which was reasonable and close to what was offered, but she was afraid that if she countered, they would rescind the offer.
As a sales professional, I deal with negotiations every day. After the first decade, I assume it just becomes part of everyday life and is viewed as business as usual. Salary negotiations are the same.
Employers expect a counter-offer. I personally have expected them when interviewing candidates. And except for one instance (I’m not perfect), I have always given a counter-offer successfully.
Ultimately, it was my wife’s decision, so I encouraged her to ask for what she thought she was worth. Knowing the situation, the company, her experience and her fit for the position, I knew the worst that would happen would be that they’d say “no.”
Luckily, they didn’t. They accepted her counter-offer because she was the right person for the spot.
The point I want to make is that my wife knew what she was worth. She knew she was the best person for the job. Her request was not unreasonable. And yet, she was still afraid to ask.
From my experience, this is very common. Whether someone is interviewing for a job with a $25,000 salary or a $225,000 salary, asking seems to be hard for most people.
What I want to propose is that you bite the bullet.
If you want facts, remember that the study mentioned above claims real, long-term success for people who asked for a 10% increase in salary. If you want emotions, then remember that you know yourself better than anyone else. You know what you’re worth, what you need and what you deserve. If you want common sense, remember that companies expect salary negotiations (unless they say otherwise) and budget for them.
So take the plunge and simply ask. Because if you accept anything less than what you think you’re worth, that’s what you actually are worth.
What are you really worth — and how can you start asking for it?