One of the best ways to increase your income is at the source: during salary negotiations either when you land a job or during a performance review.
In recent years, of course, many people have been more worried about keeping their jobs (or finding new ones) than moving up the ladder. But even in the current job market, it’s smart to know how to negotiate — and to be willing to do so. If you don’t ask for more money, your employer certainly won’t just give it to you.
This can be scary, and rightfully so. For most folks, salary negotiations are awkward.
Career coach Jack Chapman has come to the rescue. His book about salary negotiations is well respected among career counselors and deserves a wider audience. Negotiating Your Salary: How to Make $1,000 a Minute is a step-by-step guide to getting paid what you’re worth. Chapman argues that those few minutes in an interview during which you ask for more money can make a difference of tens of thousands of dollars over your lifetime. Maybe hundreds of thousands. You can literally earn $1,000 a minute if you do this right.
“We spend years thinking about what we’ll be when we grow up,” Chapman writes. “But when it’s time for a raise, most of us just accept whatever we’re offered. How many minutes do we spend negotiating the money? Zero.”
His book offers five specific rules for negotiating your salary:
- Postpone salary negotiations until you have been offered a job (or after a performance review). Chapman says the hiring (or evaluation) process consists of two phases: judging and budgeting. You can only hurt yourself by dealing with salary when the employer is judging instead of budgeting.
- Let them go first. Chapman argues that it’s difficult to win by being the first to name a number. But for many people, it can be awkward to evade direct questions. Chapman recommends preparing for this situation. His website includes a short video on how to answer the question, “What are you earning?” or “What are your salary expectations?” (See also: Penelope Trunk’s advice on how to answer the toughest interview question.)
- When you hear the offer, repeat the top value — and then be silent. “The most likely outcome of this silence is a raise,” Chapman writes. The book offers a specific technique for responding when you hear the salary offer, a technique that’s designed to give you time to think about it while also putting a little pressure on the employer.
- Counter the offer with a researched response. Your next move is to make a counter-offer based on what you know about yourself, the market, and the company. Chapman says that it’s important to do your research before the interview so that you’re prepared with a reasonable expectation of the salary range for the position.
- Clinch the deal — then deal some more. The final step in salary negotiations is to lock in the offer, and then negotiate additional benefits. This is like locking in the price of the car you want to buy before you begin negotiating the value of your trade-in.
Negotiating Your Salary contains detailed instructions for each of these five steps. It also offers information for determining your fair-market value (though much of that can be done online now with tools like PayScale, SalaryScout, and GlassDoor), explores special situations that break the rules, and offers tips for applying these techniques to raises and performance reviews.
You can learn more (and buy the book) at Chapman’s site about salary negotiations.