You work your butt off.
You've taken on extra responsibilities at the office. You slave away after hours. You've gone above and beyond to impress your boss and be the best employee you can be.
And now…you want a raise.
There's just one problem.
Getting a pay raise for the job you're already doing is really hard.
Really, really hard.
At my last job, prior to starting VTX, I found out first hand how difficult it is to approach your boss and ask for a raise.
It was working at a local wealth management firm, my first job out of college, and I was moving up the ranks pretty quickly.
Well, except for my pay, that is.
Once I became salaried (I was paid hourly with no benefits my first year of employment there…don't ask me how I thought that was okay), it seemed like I was locked in at that number.
That number was $33,500 per year.
Let me preface what I say next by saying, I was grateful for the opportunity to even have a job, and I have no ill will whatsoever towards my last employer.
For what I actually did at my job, though, $33,500 was an embarrassingly low salary.
I had my Series 7 stock broker license. I was regularly meeting with clients and managing their portfolios (many over $1M) with little to no oversight from my boss.
I executed all trades for the firm, kept in regular correspondence with all of our “top clients”, and was heavily involved in some big projects way outside the scope of my job duties. I was doing a pretty good job.
But, I was stressed beyond belief and I felt worn down to the bone. I knew I couldn't keep going at the pace I was, and definitely not for just $33,500 per year.
That meant I only had a two options: get a new job or get a pay raise.
I chose to ask for a raise.
Lessons I Learned from Asking for a Raise
For a lot of things in the real world, there really is no substitute for experience.
And that might be true for salary negotiations, too, but I want to at least try to pass along some of what I learned from my own go at it.
If you are thinking about making the “big ask” any time soon, keep the following tips in mind.
Mindset Shift Number 1: You Will ALWAYS Be Paid Less Than You're Worth
This is a tough pill to swallow, but it's true.
As long as you are working for someone else, whether it's a small business or a major corporation, you will always be paid less than you are worth to that company.
If that weren't the case, you wouldn't have your job for very long! That's just the way business works.
This one of the biggest drawbacks of working for someone else– it's hard to ever fully reach your true income potential.
I knew I was providing more value to my employer than the $33,500 I was being compensated, but that's only a small part of the equation.
Knowing this fact is important for the next part, though.
Mindset Shift Number 2: Put Yourself in Your Boss's Shoes
Why should your boss pay you more, if you've been doing such a fine job as-is, at your current salary?
What's in it for them?
Always ask yourself those two questions.
And if your only answer to that is, “well, I might leave,” then please rethink that.
You are more replaceable than you think.
(So much for a feel good article about making more money at work, right?)
When you approach your boss to discuss getting a pay raise, you should always have something extra up your sleeve that you can offer your boss in return for higher pay.
Maybe it's taking on a monthly admin task. Or having a more active role in prospecting for new clients.
Whatever it may be, you gotta have something.
Even if you start the conversation with highlighting the growing discrepancy between your current responsibilities and your current pay, you still need to throw your boss a bone.
Pay raise talks based on pity alone will just never go well for you.
Do Your Research
This one should be a no-brainer, but I want to include it anyway.
Before you approach your boss to ask for a raise, make sure you have done your research.
Figure out what the median salary is for whatever field/job role you are in, and keep in mind the other factors that play into your salary, like experience, location, etc.
The last thing you want is to find out that you're being paid right in line with what you should be making, but you actually think you're underpaid. Don't make that mistake.
It's also a good idea to get salary information for jobs a step above where you are at now.
For example, even though I technically wasn't a full blown financial advisor, I still collected salary information for that job.
Because even though I wasn't quite at that role yet, I actually had many of the same responsibilities. So when it came time to negotiate, I had some extra strength to my case.
“I share this, this, this, and this responsibility that a typical financial advisor also has, and the median salary for that position is $70,000. With my current job role, PLUS some of the responsibilities I have of this higher paid role, I think a fair salary for my position would be $60,000 per year.”
Has a much stronger impact than saying this:
“I make $33,500 now but I would love to be bumped to $60,000 LOL so do we have a deal??”
If it helps you, consider organizing your data and job role information into a basic Powerpoint that you can print off for easy reference. It definitely helps to have your resources at the ready.
Set the Appointment
There's no shortcut around this one and no life changing “hack.”
When you are ready to broach the subject, you need to come straight out and ask your boss when you two can set aside some time to discuss your pay and your job responsibilities.
Every boss in the world knows what this means, so don't feel like you are beating around the bush when you suggest meeting about this.
And yes, this needs to be an in person meeting. Salary negotiations shouldn't take place over email or phone, unless if perhaps your boss works in a different location than you.
Keep Things Positive
When it comes time for your big day, your meeting with your boss, I can't stress enough how important it is to keep a positive tone when presenting your case.
I mentioned this before, but it's worth saying again: pay raise talks based on pity and/or negativity will not go well for you.
The last thing you want to do is to guilt trip your boss or take an unnecessarily abrasive tone. You may have a lot of pent up angst over your job, but this is not the time to vent!
That's not the way you want to get a raise, and it's not a good way to position yourself as someone who wants to move up the food chain!
Be strong. Don't vent.
Be strong! Don't vent!
It's a Conversation — Ask Questions!
The most valuable source of information for figuring out how to secure a pay raise is sitting right across the table from you, so now is the time to speak up.
Instead of a one-sided “rant”, ask your boss what it would take to get to whatever your desired salary is, and more importantly, ask what the best course of action would be for you to progress into that role (or added responsibilities).
The more conversational you can keep the meeting and the more you can approach your boss from a position of empathy rather than spite, the better chance you have of getting what you want.
Be Ready to Accept Feedback
This was something that caught me off guard, but shouldn't have.
As I was highlighting my accomplishments and presenting my case, my boss acknowledged them but then readily offered areas that he would like to see me improve in.
It wasn't anything harsh or overtly negative, but it added a certain wrinkle to the conversation that I didn't expect.
Nevertheless, the best way to handle that is to simply accept the feedback gracefully and then pivot back to your what you want to focus on. Don't discount the feedback, but succinctly accept it and move on.
Be Prepared to Not Get an Answer Right Away
Another thing I didn't expect, but it makes perfect sense now that I look back.
The way I had envisioned the conversation going, I was going to walk out of the meeting with an answer and a number, one way or another.
But then my boss simply said, “Thanks, Jeff. I'll take a look at all of this and I'll see what I can do.”
That's not what I wanted to hear. But there also wasn't much I could do about it.
To be fair, I was a $33,500 employee asking for a raise to $60,000. And it came out of nowhere. That's not normal.
He probably needed some time to wrap his head around to figure out what in the world was happening what he was going to do.
And so I waited…
Have a Plan for What Happens If You Don't Get What You Want
I should have mentioned this earlier in this post, but probably the smartest thing I did during my raise negotiations happened well before I ever spoke to my boss.
I devised a Plan B.
A plan for what I would do if I didn't get the raise I was asking for.
I was asking for a $26,500 raise, nearly double what I was currently making (yes, I truly felt that underpaid, and I still stand by it). An ask that big is going to get rejected a large percentage of the time, so I needed to be prepared.
Now, this is going to be different for everyone, and I'm not necessarily saying that my Plan B is the best way to go. But it was best for me.
I decided that, if I didn't get my salary increase to at least $50,000 per year, I was going to quit my job and start my own business.
NOTE: There are many way less drastic options than this. I had already saved up a years' worth of expenses and had a very detailed plan for what I wanted to do, but that's a story for a different post. I knew that this was what I wanted to do, as opposed to finding another job.
So, about a week later, my boss called me into his office to follow up on our recent meeting.
He offered me a $40,000 per year salary–a 19.4% pay raise.
I could tell there was no room for further negotiation, so I accepted his offer.
And then, 3 weeks later, I gave my notice.
I had to stick to my plan.
I knew I was meant for more, and I took the step that is sometimes the hardest one to take: I acted on my plan.
All I can say is, make sure you have a backup plan. Even though I just landed a huge raise, I knew my happiness at work was worth more than the raise.
With the Right Approach, Getting a Raise is Doable (and Even Easy)
Assuming you are in a role where your boss has the power to actually give you a raise, a lot of times just the act of asking will go a long way.
One thing is for sure though, you won't get what you don't ask for!
Most bosses are happy to give you more, within reason, if you are doing a decent job. A good boss wants their employees to be happy at work, and recognize that salary does play a role in that.
In your career and in business, if you can get comfortable being in uncomfortable situations (like asking for a raise), you will generally do well.
Most importantly, always keep striving for more! More pay, more impact at your company, more impact on the world.
But don't forget to stop along the way every now and again to smell the roses 🙂
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You'll usually see me on here writing articles about how to save (and make!) money, how to make smarter investment choices, and how to have a better overall financial life. If there's ever a topic you'd like to see me cover, shoot me an email!
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