Salary negotiations for women: how to earn a higher paycheck

Women have a lot to think about when negotiating salary. Learn about the importance of preparing and negotiating your desired salary before accepting a new job.

  • Facebook.
  • Twitter.
  • LinkedIn.
  • Print

During the week-long national conference for the Society for Human Resource Management, I gave a speech on salary negotiations for women. Mary, a 55-year-old HR manager, waited patiently to chat with me after my presentation. When the others had left, Mary began, "Seven months ago I took the job I have now. I didn't do any of the things you just taught like negotiate the salary before I said yes. I know I should have, but I simply accepted the job offer. I see now that was a giant mistake. I'm underpaid for all I do and I am working a lot of hours. I really want a raise. Can I go in now and renegotiate the salary?"

I wish it was the first time I had heard that question. Unfortunately, it was about the tenth time I'd heard it that week. Women often accept a new job and never say a word about the salary that is offered. Just like Mary, they simply say yes to what is offered. Then a few months into the job, they want a raise. The time to get the higher salary was before they said yes, yet over and over again, they simply accept the job as offered. And even though Mary said she wanted to go talk to her boss about raising her salary, I suspected she never would actually do it.

A 2018 survey by global staffing firm Robert Half found that only 34% of women tried to negotiate a higher salary during their last job offer.1 And for women Mary's age, 55 or older, that number was only 30%. Much has been written about why women refrain from trying to negotiate salary. Many career experts believe that it's a cultural thing, that women who are now in their 50s or 60s were raised to be nice and accept what is given them. But if 30% ask, more can sure learn.

I do understand how Mary got into her current dilemma. She is a good worker and she likely deserves a better salary than she is making. Months ago, she just wanted another job. She updated her resume and waited for employers to call. She's a bit insecure and since the job search process takes time, she got even more insecure. Finally, an employer contacted her and she went to a job interview. She was nervous and answered all the questions. They likely asked her what her current salary was and she told them. First major salary negotiation mistake. A week or two later, the company called and said, "Mary, we'd like to offer you the job. Can you start next week at $XXXX salary?" Finally a real job offer, so either Mary wasn't working and she isn't going to turn it down, or even if she has a job, she is unhappy, which is why she is looking. So for either reason, Mary just said Yes. This new employer knew exactly what her old salary was, so the employer's offer was about the same or a tiny bit higher based on whether she is employed or not. That quick "yes" is one of the biggest career mistakes you can ever make.

Why? Because in that one second of agreement, you have lost the opportunity to discuss with the employer whether or not they might pay you a higher salary to join their team. In many cases, the answer is yes. In fact, you only change jobs a few times in your lifetime—you must maximize these opportunities to get the highest pay raise possible. According to the analytics that Burtch Works consulting did examining salary when people changed jobs for 2017, the overall median increase in base salary was 14.3%.2

The impact of not successfully negotiating salary when accepting a new job is monumental. All future raises and bonuses are based on the initial salary and it can take years to catch up to what a man negotiated, after you take a low offer.

New labor studies reveal how not negotiating your salary means losing $500,000 to $1,000,000 in lifetime earnings according to Salary.com. In my experience, especially in today's market, the first job offer is far from the best offer. You won't know that, though, if you never even try to ask for more money and better perks.

Just think about the lifestyle differences successful salary negotiation would mean to you over a lifetime; a lovely home, college educations for your children, more secure retirement—it's an amazing difference that comes down to a few minutes in a woman's life that she has to get right.

When the actual time comes for a woman to face a hiring employer and discuss salary, she often does not do it.

Why?

Most are simply afraid. Mary, like so many other women I've counseled, says that they were scared. Maybe the employer will rescind the job offer. And for many more women, they lacked the self-confidence and know-how on what to say and when to say it. In my experience, I have never found the offer was pulled back. The employer may say there is no more money slated for the job but if they have decided you are the right person, they usually just ask again if you going to take their offer.

Here are some guidelines to help you try to negotiate your next job offer:

  • Confidence comes from preparation. Read about the strategies of salary negotiations in advance before you ever talk to an employer. Face your fears head-on. Do your research. Practice how you'll handle any salary questions effectively so you can increase your ability to handle these. Roleplay the situation with a coach or friend so you know how to ask an employer to pay you more than originally offered.
  • Know what your skills are worth. Do some research before you ever talk to an employer or fill out an application. Learn exactly what you should expect to be paid for your years of experience, education, and any special training you have. Payscale.com and Salary.com offer free salary information to help you get an estimate on what you should be earning.
  • Don't reveal your current salary. You cannot recover from this error. So you must never tell the employer what you make. Instead, cite a source, and use a wide salary range. When dealing with an application, try leaving the online section for salary blank, or enter a long line of zeros, and if asked during the interview turn the question around, and say, "What does this position pay?"

Most employers tell me they almost always offer a lower salary to start out. Most have a range they can pay but unless you begin the negotiations process and show you expect to be paid what you are worth, you won't get the higher salary. Morale of this story is: TRY.

Topics:
  • Facebook.
  • Twitter.
  • LinkedIn.
  • Print
Sources:
1. Robert Half, Only 34% of women tried to negotiate a higher salary during their last job offer, February 5, 2018.
2. Burtch Works, The overall median increase in base salary was 14.3%, May 22, 2017.
Article copyright 2018 by Forbes. Reprinted from the November 6, 2018 issue with permission from Forbes.
The statements and opinions expressed in this article are those of the author. Fidelity Investments cannot guarantee the accuracy or completeness of any statements or data.
This reprint is supplied by Fidelity Brokerage Services LLC, Member NYSE, SIPC.
The third-party provider of the reprint permission and Fidelity Investments are independent entities and are not legally affiliated.

Votes are submitted voluntarily by individuals and reflect their own opinion of the article's helpfulness. A percentage value for helpfulness will display once a sufficient number of votes have been submitted.

Fidelity Brokerage Services LLC, Member NYSE, SIPC, 900 Salem Street, Smithfield, RI 02917

868019.1.0
close
Please enter a valid e-mail address
Please enter a valid e-mail address
Important legal information about the e-mail you will be sending. By using this service, you agree to input your real e-mail address and only send it to people you know. It is a violation of law in some jurisdictions to falsely identify yourself in an e-mail. All information you provide will be used by Fidelity solely for the purpose of sending the e-mail on your behalf.The subject line of the e-mail you send will be "Fidelity.com: "

Your e-mail has been sent.
close

Your e-mail has been sent.
piggy

Get more insights from MyMoney

Just sign up and we'll email our latest thinking every 2 weeks.
Not sure? Learn more
We understand that privacy and security are important to you and will only subscribe you to the MyMoney newsletter. See our Privacy Policy.

Here's what we suggest you explore next

Investing tips: Is it better to go bankless?

When you're just starting out in your investing journey, there are some important things you should know.

Like your checking account, but with some useful extras

All ATM fees reimbursed. No minimum balance. Pay bills. Deposit checks.

You might also like

This is the best way to follow up after an interview to stand out

The interview went well and you left feeling optimistic, but how do you follow up? Discover the best steps to take after an interview to help you stand out here.

5 tips for new grads

For new grads this spring, finding helpful tips to help you get started on building your career path may be tricky. Read here for more career tips and information.

If you’re thinking of starting a new job search, here’s what to expect

Thinking of starting a new job this new year? Read about the importance of knowing what to expect before jumping in.

Like your checking account, but with some award-winning extras

All ATM fees reimbursed. No minimum balance. Pay bills. Deposit checks.