Mistakes to Avoid When Negotiating a Raise

Employee discussing raise with boss

If you’re doing a great job in your current position or you’re looking for a new job, you may be thinking about negotiating a raise. Afterall, you’re worth it! You work hard, you’re a team player, and you not only get the job done, you excel at it.

But asking for a raise can be a touchy subject with employers and if you don’t approach it the right way, you can kiss your bigger paycheck goodbye.

Mistakes to Avoid when seeking a raise

Not Doing Your Homework

You need to have a plan when asking for a raise. You need to know not only that you want it and deserve it, but that it’s in the best interest of your company.

Start your homework by making a list of your accomplishments, the times you’ve excelled at your job, and how that has benefitted the company. Then, research similar jobs in your field; how much are other employers paying?

Lastly, know your company. You may need a raise so you can buy a bigger house, but your company doesn’t care about that. Why do you deserve a raise? How will paying you more money benefit them? Do you have a high customer service rating? Do you close more sales than anyone else? It’s important to know this before starting negotiations.

Springing the Conversation on Your Boss

When speaking to your boss, open the conversation slowly, never spring the salary discussion on them. A negotiation is an ongoing conversation. Let your boss know that you’d like to talk to them about your salary and schedule an appointment. This is respectful of their time and will also allow them time to do their own research. If you have a performance review coming up soon, hold your discussion until that time.

Seeing Your Salary as the Only Negotiable Option

While your salary is the probably the thing you want to negotiate the most, your company may not be able to meet your desires. However, they may be willing to negotiate other things to compensate for the difference, like additional vacation time or the option to work from home more often. They may be willing to reimburse you for courses you want to take or cover work-related expenses like cellphone bills or tolls for your commute.

Be open to other options, you may find that you’re happier with the result than you expected to be.

Giving an Ultimatum

When your efforts to negotiate a raise fail, it can be tempting to walk away. But this could end up hurting you. If you already have a job and threaten to leave, they may just wish you well. If you bluff about the new job, you could find yourself without any job. And if you’re negotiating for a new job, they may decide to pull their offer, again, leaving you without a job.

Issuing an ultimatum can be dangerous for you and burn bridges that you may not want to burn. Instead, try to compromise. Maybe your company can’t offer you a raise now, but be willing to reconsider in a few months based on your performance. Holding on to your current job comes with things you won’t have at a new job like seniority, earned vacation time, and possibly health insurance or 401k contributions. Step back and take a look at the big picture.

Negotiating a raise can be a great opportunity to pat yourself on the back and show your company how much you’re really worth, but be sure to approach it the right way or it could end up costing you.

Tagged in Earning extra income

Emilie writes about overcoming debt, while balancing trying to eat healthy, stay fit, and have a little fun along the way. You can find more of her work at BurkeDoes.com.

  • The Consumer Federation of America (CFA) is an association of nonprofit consumer organizations that was established in 1968 to advance the consumer interest through research, advocacy, and education. Today, nearly 300 of these groups participate in the federation and govern it through their representatives on the organization's Board of Directors.
  • The National Council of Higher Education Resources (NCHER) is the nation’s oldest and largest higher education finance trade association. NCHER’s membership includes state, nonprofit, and for-profit higher education service organizations, including lenders, servicers, guaranty agencies, collection agencies, financial literacy providers, and schools, interested and involved in increasing college access and success. It assists its members in shaping policies governing federal and private student loan and state grant programs on behalf of students, parents, borrowers, and families.

  • Since 2007, the Homeownership Preservation Foundation (HPF) has served as a trusted, neutral source of information for more than eight million homeowners. They are partnered with, and endorsed by, numerous major government agencies, including the U.S. Department of Housing and Urban Development and the Department of the Treasury.

  • The mission of the U.S. Department of Housing and Urban Development (HUD) is to create strong, sustainable, inclusive communities and quality affordable homes for all. HUD works to strengthen the housing market in order to bolster the economy and protect consumers; meet the need for quality affordable rental homes; utilize housing as a platform for improving quality of life; and build inclusive and sustainable communities free from discrimination.

  • The Council on Accreditation (COA) is an international, independent, nonprofit, human service accrediting organization. Their mission is to partner with human service organizations worldwide to improve service delivery outcomes by developing, applying, and promoting accreditation standards.

  • The National Foundation for Credit Counseling® (NFCC®), founded in 1951, is the nation’s largest and longest-serving nonprofit financial counseling organization. The NFCC’s mission is to promote the national agenda for financially responsible behavior, and build capacity for its members to deliver the highest-quality financial education and counseling services.