I’ve joined over 40 women in a collaboration to inspire and encourage women to take control of their finances. As I learned through the creation of the female finance writers and podcasters blogroll, it’s time to shout from the rooftops that so many of us already are taking that control. It’s time to break that perception and make it clear that women have – and should have – control over their finances.
I want to talk a bit about salaries – and raises – because as much as your savings rate depends on tracking your spending closely and determining the big money wasters in your budget, the income side of the equation is what can really jump start your financial security.
Starting Income
At thirty years old, I make a reasonable salary (our combined household income is now just over the median for our area). However, I can’t take much credit for this salary increase over the years. I’m lucky to work for an employer that does regularly give raises to employees at our annual reviews, so my wage has gone up over the years because of those meetings.
Backtrack to 2009 when I graduated college, and asking for raises wasn’t on my radar in the slightest; I had graduated at the end of the Great Recession and getting a job at all felt like a huge accomplishment. When I finally landed my career job the following year, I was just ecstatic to be working a job in my field doing something I cared about.
However, I had no idea what pay to ask for, and only had my park ranger and pet store salaries to compare to. I was a passive part of the discussion, and accepted 50¢/hour more than my parks job. I was really green and had a lot to learn, so this felt like a fair wage, though looking back it was probably on the low side of reasonable (but again, this was right after the Recession and wages in general were suppressed, once you even did find a job).
As you’ve probably heard again and again, women are less likely to ask for raises, and I’ve been solidly in that group. I may be pretty comfortable these days discussing our monthly expenses and our previously large money drains, but sitting down in a meeting and negotiating a salary is something I’ve never been good at. Actually, it’s something I had never done at all until this past year.
While doing some research for this post, I stumbled on some new studies that suggest though that perhaps more women are actually asking for raises – they just aren’t getting them. I expect the real number is somewhere in the middle – that fewer women ask, and that fewer of those who do ask then get the same raise as their male counterparts. I won’t pretend to be an expert on the topic, but there is plenty of information out there if you want to learn more.
The importance of that starting wage
Circling back to that park ranger job I accepted almost a decade ago, I found out later that a couple of my coworkers made a bit more than I did, even though I was the only one with experience specifically related to the job. How did that happen? Well, they didn’t originally get offered more than I did, but they went back after the job offer and countered that pay.
While the $1/hour they made wasn’t a huge difference in income at that time, it was the launching point for my income after that first job. While there is currently legislation being discussed to restrict the requirement of sharing of your income from previous jobs, this wasn’t the case when I did land my permanent job. Because I hadn’t countered my initial offer and been paid a $1/hour more, I was subsequently paid less at my next job. And from there on out, any raises after that were based, at least to some degree, on that starting salary.
While these starting numbers were small, they compound over time to add up to real money over the course of years and decades. And, if you are looking to financial independence and early retirement, those lost dollars mean additional years before you hit your FI number.
Asking for that raise
It took me seven years at my current job before I finally took the initiative and went into my annual review prepared on the income front. I credit a lot of this change in my deeper immersion into the financial independence community, because this is a topic that is actually discussed.
To be honest, to put forward what I felt was a fair income and compensation in an annual review felt really hard and awkward. While I am generally very straightforward and unafraid about most things, but this was uncomfortable and took a lot of courage in my part to actually bring it up in the end.
However, I didn’t back down, knew my worth, and pushed ahead. And you know what? I was rewarded for it. I’m happy to say that I feel I am fairly compensated for my job and that the raise conversation was quite successful. Thanks in part to that conversation (in combination with our more recent drastically reduced spending), our FI number may be possible before we’re forty, a good five years sooner than I had first projected. I still have no plans to quit my job at that point, but I can’t wait for the day that I can say with certainty that I am there because I want to be, not because I have to.
What I did – and what you can do too
1. Do your research
Step one of preparing for my annual review and my ask for a larger raise was to do a lot of research on the going rate in my area for similar positions to mine. Since I work at a smaller company, my title/job description isn’t something that can easily looked up for comparison’s sake, so I had to dive into a number of different career options to find a range that seemed applicable to what I do in my job.
I then compiled all those numbers and had them accessible for the meeting so I could confidently say what my position was worth. It was the first time I felt I had a real handle of what my position would pay at another company, and it was very empowering to know I’d done a thorough job with my research.
2. Come prepared
Not only did I have salary numbers with me to bring to the meeting, but I also took quite a bit of time to lay out what I had accomplished in the past year as well as what I would like to get done in the next year. By laying out completed tasks, I was able to show that my value was as I was showing on paper.
3. Be confident and just ask
This was the hardest part. Even though I knew I was going to be assertive when it came to the salary part of the discussion, I had to force myself to be confident and actually make the ask. In previous years, I had really skirted the question and simply accepted any salary change offered. This time, I made the offer that I felt was fair, instead of being a passive observer in the discussion. I did ultimately get the raise, and it felt awesome that I had been a part what made it happen. I’d worked hard through the year, but I also worked hard in preparation for the final ask, and it certainly showed.
4. Remember that a job is more than just money
Finally, not everything comes down to income. There are myriad reasons to take a lower paying job -lower stress, more flexible hours, shorter commute, or a passion for the job itself, to name a few. However, just because a job is a passion or has other wonderful perks does not mean that it should pay less what is fair.
A large part of why I never pushed for a raise beyond what offered before this point is that my jobs have been ones I’ve truly enjoyed and felt like the work I was doing really mattered, so it somehow felt wrong to then ask for more money on top of that. I didn’t want to be seen as ungrateful for the position or that I cared about the money more than the purpose. I’ve finally come to accept that that is irrelevant, and there is nothing wrong with asserting fair compensation for a job well done.
Have you had a similar experience with accepting salary offers / negotiating raises? Is there anything you would tell someone who was looking to do something similar?
Now head on over to the #womenrockmoney homepage to read all the other awesome stories written in collaboration for today’s celebration!
What great advice! Valueing my work is something I do struggle with, but I’m working to get better at over time. Happy International Women’s Day!
I’ve always been happy with my work, but valuing it on a monetary scale instead of an impact scale has been the most difficult part for me.
Do your research and be prepared! Critical steps before asking for a raise, really good points. I really enjoy my job but did have to ask for raises beyond the annual review process a few times in my career. So glad I did and so glad I prepared for it.
It’s a funny thing that the more you like your job the harder it is to ask for that raise.
The asking is the hard part, but you don’t get what you want unless you do ask. Having been a hiring manager, I know MY bosses discourage me from encouraging it my team, which always frustrated me. And why I’m not longer a manager. Now I feel good coaching my younger team members.
What a frustrating spot to be. I feel like an important part of being a manager is to encourage that sort of thing!
I had a hard time figuring out what to write for International Women’s Day because there are so many topics that need to be addressed. This is definitely one of them! I’ve made pay rate mistakes in my life, for sure. Thank you for writing about negotiating.
That’s the awesome part about there being some 45 women writing today – together we can cover quite a few of them 🙂
I didn’t negotiate in my first job, and then learnt do it when I saw that my husband (then boyfriend) who had a year of experience less than me (and at an employer who typically pays less than mine) earned more than me. Learnt my lesson then.
Glad you learned it so early on! That compounding effect is so powerful over the years.
I am not pretty good at negotiating. And I negotiate again every year!
But I’m certain you’ve gotten a heck of a lot better over time!
Practice makes perfect !
You make a good point about it being harder to ask for a raise when you do truly value the work. Considering I’m just doing it for the first time now, maybe it’s a good thing I’m not in love with my job haha!
Also sweet flip phone you’re rocking in that photo 😉
Ha yeah, I was wondering if anyone would notice my awesome flip phone. 2010, so I obviously wasn’t an early adopter of smart phone technology 😉
What really changed my mindset was working in consultancy, and seeing how much they charged me out at. Scary numbers. That helped me anchor my value much higher.
And on the asking: I think less women ask, and when women ask, they can be treated differently to men. But I don’t think it really matters in big companies, as they usually stick to the agreed pay matrix.
And the gender pay stories that are coming out in the UK make scary reading…
You say it doesn’t matter in big companies – but a lot of those numbers being reported ARE from the big ones.
The problem comes the the bonus, because the matrix is terrible at generating a $ value on that.
This is some great advice. I’ve honestly never asked for a raise before as I’m the same way, I’d feel very uncomfortable and think it would be really awkward.
While I am up for promotion I’m the next month or two (should be coming soon!) those raises cannot be negotiated st our company.
Depending on how big it is, I am most likely going to ask for another raise during my mid-year review. I know of a couple peers with similar experience and years worked that make a little more than me, so I’m at least going to be asking for that, if not more!
I am already doing research to prep for our mid-year reviews so I’ve got a good handle on everything 🙂
Interesting that a raise isn’t negotiable at a promotion. It sounds like you’ll be ready at the time you can bring it up though!
Great advice! I didn’t learn to negotiate my starting salary or ask for increases until very late in my career. Thank goodness I finally learned to!
It’s a really, really hard one to learn. No one is going to look out for your bottom line like you will 🙂
$1 per hour is A LOT OF MONEY!
If you’re working 40 hours a week and have paid vacation that’s $2,080! All the dollars add up! The pennies add up! Even a quarter raise is an extra $500 a year!
Fight for your quarters and dollars, guys!
You look so cute in your park ranger outfit :D.
Well, when you put it that way…. and it just compounds from there over the years! Ha, and thank you – I felt pretty awesome in it 😉
I think it’s very easy to fall into the trap of saving money and only focus on that side of the equation. Saving money, for the most part, is easy. Making more money (by working harder and asking for raises) can be hard and uncomfortable…but it can make a HUGE difference in your financial future. Thanks for sharing and highlighting the fact that making more money is important and possible 🙂
That’s true – you really have to look at both sides of the equation to make big numbers happen. Gotta grow the gap 🙂
I struggle with confidence in other parts of my life, but fortunately asking for more money isn’t one of those areas. I even remember negotiating my babysitting wages… But this is such an important message! I’m always surprised that people don’t counter the first offer in a professional job. When my hubby countered for his first job, his then boss hesitated since he had already turned all the paperwork in, he had never had an initial offer countered.
Whaaaaat even countered babysitting wages?? You’re a ROCKSTAR.
I had a strong professional female role model growing up (outside of my mom, who is also awesome).
(Whoops, hit enter.) But countering that offer meant he made an extra $1/hour that first year, and kept earning more money with four years of raises at that employer to follow.
Well done Mr. Kiwi!!
The Ask can be so hard! But we must do it for our own sakes, and the financial security of our families. We are worth it!
Didn’t know you were a park ranger, that’s so cool! I don’t need a job, and I still have a part-time one, but I love the outdoors so much I’ve always considered being a park ranger at one of the big parks in the future. But I know how hard that is to get into. Even a part-time gig doing trail maintenance or something would be kind of cool. Just to get paid to be in the outdoors for a while.
If you’re really interested in going that route, I would suggest looking at city park ranger or naturalist positions instead of state/national ones. There’s a lot more flexibility and you get to actually choose your location.
Awesome, thanks for the tip. Here in the DC area we have tons of national level but Virginia and MD do have some nice State Parks
We will be driving through that area in a couple of months, in fact 😉
Great advice! Though I still have to admit I have never negotiated for a raise in my life. I am organised, and my company gives an annual increase to keep up with inflation, so in a way, I feel like they do the work for me. Plus, I’m in a very particular field where you’re supposed to work for the greater good, not for money (any asking would make you a dirty capitalist).
One day I hope to work up the courage, if I need it. But it would be even better if I was employer independent by the end of this contract!
That seriously the hardest part – working at a job that’s “for the greater good” because it does feel dirty asking for more money. But just because you’re doing important work doesn’t mean you shouldn’t be fairly compensated for it!
Absolutely!
Well done for having the salary conversation. I worked as a lawyer for 30 years but never asked for a review. I did get regular increases but never questioned the amount, partly because I considered myself well paid compared to many. At the same time, I knew that male peers earned quite a bit more. I wish I had challenged that for the sake of the women coming up behind me. That status quo will not change unless women learn to value themselves more and to speak out about their value
That is such a good point – it’s not just for you, but for those who come behind you as well.
I love this post. It took me so long to realize my worth and ask for more compensation. Sadly, I have found that the best way to get higher pay was to jump jobs. The last time I had a review (2013), I came prepared with data on pay for my job and the knowledge that I was a vital part of their business (and the facts to back that up) and they still refused to increase my salary or negotiate vacation, etc. Luckily, I also came with the knowledge that my skills were highly sought after and left a month later for a 17% pay increase and better benefits.
In my profession, physician assistant, the majority of us are women. The statistics show that we are consistently paid less then are male counterparts. Which is ridiculous!
Oh I hadn’t known that part about your no raise review! Glad you found a place that really seems to be an awesome fit for you. If a place is that unwilling to budge even in the face of facts, you really have to wonder if they have your best interests in mind.