How to Negotiate Your Salary and Ask for a Raise with Confidence

The thought of negotiating your salary during a job interview or asking for a raise in your current position might make you feel uncomfortable. But incremental pay raises are a critical part of increasing your ability to build wealth over the course of your career. 

Find out why salary negotiations are so important and how to navigate the conversation at any stage of your career.

Why Salary Negotiations Matter More Than Most People Think

Increasing your salary is a major part of developing your financial empowerment. Even small pay hikes compound over time. 

If you don’t think asking for even a minor raise is worth the effort, take a look at these examples of two salary trajectories. One employee asks for an annual cost-of-living raise, while the other stays in the same role at the same pay level. Here’s how their salaries compare at the end of a five-year period.

By year 3, Employee A already earns more than $5,000 a year more than Employee B. By year 5, the pay gap jumps to more than $11,000 – and that’s just with a modest cost-of-living increase and not any performance-based raises. 

Imagine how that extra money could help you achieve your financial goals! Hopefully you’re feeling motivated and ready to create an action plan to negotiate that higher salary, whether you’re starting a new job or ready for a raise in your current role. 

Know Your Market Value Before Starting the Conversation

Before you walk into your boss’s office to demand more money, do some research to back up your request. You’re more likely to succeed if you share market data rather than basing your request on emotion or your personal financial needs.

A great starting point is to research job openings in your area for roles similar to yours. Look at job sites and industry reports to get a sense of current salary ranges. You could show these numbers to your boss, especially if your pay is significantly lower than industry standards. Consider asking for the higher end of a salary range if you have more experience, advanced certifications in your field, or specialized skills. 

You may also have additional data available if you work in a state with newly implemented pay transparency laws. Depending on where you live, you may be legally allowed to request salary ranges of other employees in your company. More states are also requiring companies to post the pay range on their job listings.  

How to Prepare for the Salary Discussion in Your Current Role

In addition to market salary research, also prepare for a salary discussion with details on your own performance. Document your recent accomplishments, such as revenue or productivity increases you contributed to, or reduced time or cost from your projects. If you don’t have specific performance metrics, you could discuss large projects or clients you handled, especially if they increased your responsibilities.

Once you have salary and performance data in hand, think about the best time to ask for a salary raise. A natural time is during a performance review. But if you don’t have one scheduled in the near future, you could also ask after a big project wraps up or after taking on new responsibilities. 

Also consider the timing in relation to what’s happening with your company. It’s better to ask for a raise when company performance is strong. Try to avoid these conversations if there were just layoffs or budget cuts. 

Tips for Negotiating a Higher Starting Salary 

Jumping from one company to another is a prime time for securing a higher salary. On average, job switchers receive an 8% raise, compared to 5% increases for employees who stay in the same job.

While the job market is more competitive than it has been in recent years, there are still a few ways you can request a higher salary. If the job listing included a salary range, do your best to justify earning the higher end. Focus on your qualifications and experience both before and during the counteroffer conversation. 

If salary range isn’t available, try to find other market research on average pay ranges for your experience level in your area. Another option is to negotiate your broader compensation package. For instance, you could ask for a one-time signing bonus or additional PTO days.  

Common Salary Negotiation Mistakes to Avoid

Before you go into any salary conversation, be sure to avoid these mistakes that could derail negotiations.

• No research: Always come to a salary negotiation with data backing up your request, whether it’s market salaries or a summary of your performance. 
• Emotional negotiating: Approach your negotiation from the company’s perspective, not your personal point of view. Getting emotional doesn’t provide a strong justification for your request.
• Looking at salary only: While a company may be limited on payroll budget, they may have more flexibility on PTO or other benefits. 
• Poor timing: Remember to schedule a salary conversation when it makes sense, such as during your performance review or after wrapping up a large project
• Too many negotiation points: Whether you’re negotiating a raise or a starting salary, focus on negotiating just one or two items. Pick what is most important to you so you don’t come across as unreasonable. 

What to Do If Your Raise Request is Denied

Even if your salary increase request is denied, there are several ways to set yourself up for future success. For starters, stay professional and thank your boss or HR representative for their time. Avoid showing anger or resentment. 

Next, ask for a timeline to revisit the salary conversation – and put a meeting on the calendar. Just because the answer is no today doesn’t mean you won’t receive a raise in the future. To improve your odds, ask about what you need to do to reach the next salary level. Ask for feedback and growth opportunities to help get there, and continually check in with your supervisor on your progress.

The Bottom Line

Negotiating a higher salary is a foundational part of earning more and achieving your professional and financial goals. Once you start making this a regular conversation, you’ll feel more comfortable in the future. Consistently advocating for yourself not only helps you earn more, but also positions you as someone who wants to grow and learn. Ultimately, that can lead to more fulfilling work and pay.