6 Steps to Better Pay

By Erica Sandberg on Wednesday February 03, 2010
This post is about earning, negotiating


dw_resolveErica Sandberg is a columnist for CreditCards.com, and the author of "Expecting Money: The Essential Financial Plan for New and Growing Families."

Confession: Like many women, I’m not skilled at negotiating proper compensation. This is ironic, given that I'm a personal finance adviser. However, I've taught myself to command a fair fee. Here's how:

Know the marketplace. It's critical to find out what others in your position earn. Ask around and use salaryfinder.com salary.com. Once you have a range, focus on the high end. Never low-ball yourself, because climbing up from the bottom rung is tough.

Know your worth. When asking for a raise or stating your fee, lay out your relevant experience and achievements. People pay you because you're good, not because they like you.

Channel a bigwig. I'm friendly with a successful Wall Streeter, whose chutzpah is legendary. When quoting my rates, I adopt his persona. Try it: Identify someone whose confidence is off the charts and imitate his or her attitude. This classic ‘fake it till you make it’ technique works.

Request the range. A large corporation recently asked me for my day rate, which I nearly revealed. Instead I asked what their norm was—and it was three times what I typically charge. Lesson: When an employer asks what you expect to be paid, politely but firmly say it depends on many factors, and ask for their range.

Rehearse. Pretend a potential employer is on the phone. State your ideal salary or fee out loud. Repeat that figure until it feels natural—and you get that question mark out of your voice.

Dwell on what you deserve. Good-for-the-world professions are rife with underpaid women. If you look at the top, though, the directors are usually well-compensated. You should be too. Quality employees come at a cost and they know it. Negotiate with that in mind.

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written by Petunia , February 03, 2010
Thank you for this advice. I am sooooo guilty of low-balling myself! I have a salary negotiation on my horizon, and I need to do a good job. In the past, my "negotiation" technique has consisted of smiling, nodding, and saying "OK". Not an impressive strategy, I know.
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written by Amy , February 03, 2010
I recently had to give a price range for my products (the actual fee differs based on lots of different factors) so I gave the customer what I thought was a good range. She came back with a price point she was trying to stick to that was in the top third of the range I had given her, much to my delight! If I had low-balled the price I don't think I would have gotten her business at all; instead, I gave her a price based on what my work was worth instead of the usual "how low can I go?"
She does great work, charges for it, and is willing to pay for great work from others.
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written by Christine , February 03, 2010
I'm pretty sure that salaryfinder link is wrong.
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written by Erica Sandberg , February 03, 2010
Hi Christine - thanks for the heads-up. It should be: www.salary.com.
ES
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written by Amber , February 03, 2010
Here's a question slightly off-topic, but is more how I would get better pay: How would you recommend coming up with a rate as a self-employed artisan? And when should I give myself a raise? I've seen advice of this sort on dailyworth for consultants, but not for someone who makes actual objects to sell. advice?
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written by g , February 03, 2010
What a timely article-- I JUST got off the phone with a long term client's new cfo who basically demanded I lower my fee. I refused. He backed off after a bit, but when I got off the phone I was shaking. I hate that dealing with money is emotional and personal for me, whereas, asking me to lower my price was probably just standard business practice for him. I've come a long way since starting out as self-employed, but how frustrating things this simple still effect me this way.
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written by Kelly , February 03, 2010
Dear Daily Worth:

I love love love your daily emails, and they are so helpful. Sober yet positive, accessible yet meaty and informative. I truly appreciate what you do every single day, and (like the nerd that I am) I always look forward to it in my inbox.

As a full-time writer and performer, I deal EVERY SINGLE DAY with negotiating my rates via my manager and booking agent (both female, I might add, who work for me under my LLC) --

Sometimes it's a true honor and pleasure to work with people, and sometimes it's a complete and total drag (i.e. people from time to time trying to low-ball you either out of lack of experience or some concept that you're supposed to be rude and play "hard-ball" for no reason with a manager, etc.).

I was especially frustrated today (in the midst of a few lingering contract negotiations), when my real estate agent called and said that the seller for the brownstone that I'm buying with 2 friends was "rounding up" our final price by $1400.00.

I pretty much lost it, and felt so frustrated by trying to fight and deal with all of my own contract negotiations as fairly as I can while being bamboozled for $1400 worth of unspecified costs in a heartbeat.

But your email today, definitely is helping me to perk my chin up and get back into the thick of plainly stating and advocating for what I'm worth and working in the most ethical, positive, and prosperity-driven way that I can every single day.

Thanks so much!

Kelly
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written by Jaime , February 03, 2010
I think this is a great article with excellent advice. I will definitely keep this information handy. Thanks!
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written by MP Dunleavey , February 03, 2010
As a long-time freelancer and contract writer, this article spoke to me too. The one thing I would add, that we didn't have space for, was that it's ok to walk away--or as g wrote above, refuse to be low-balled. i'm a lot more comfortable saying No, thanks, in a firm but positive way. And it really does make space for better work.

To Amber: I did this with a friend recently who makes painted floor cloths. We googled what other artists were charging to get a range for what, it seems, the market will bear. I don't know if you can do that with your product, but that might be a place to start. Or ask other artisans, even makers of different things, what process they used.
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written by Laura , February 03, 2010
To comment on what Amber said, knowing your marketplace and your worth applies to artists or artisans as well. If you make a quality product, charge the price it's worth then you'll attract customers who are looking for and willing to pay for that quality. I also love Kelly's story and the boost of determination she got after reading DailyWorth today!
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written by Amy , February 03, 2010
Excellent Advice. I'm asking for a raise this year, but I'm nervous. Even though I don't need to be. I know I'm their top sales person, and I know my photography is top rung.
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written by Erica Sandberg , February 04, 2010
One more thing – don’t let negative experiences in the past influence what you charge today. I worked for a woman who constantly denigrated my work and I began to feel that maybe I wasn’t so good after all. That feeling crept up in future pricing discussions. It definitely eroded my confidence. When I discovered that she had used my ideas and projects to get ahead, it was an “aha” moment. It taught me to accept criticism, but to not internalize it. Never rate your worth based on one person's opinion – he or she may have a hidden agenda!
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written by Christine , February 08, 2010
Erica,

I am in the interview process for a job that pays much higher than my current salary. The recruiter immediately let me know the salary range in our first phone interview,and then again on the second.She asked me what my current salary was and I tried to dodge the question. She wouldn't take no for an answer. I gave her a range and she insisted on the number. I narrowed it down but didn't give an exact number. Now that they know my salary is a lot lower than what their client is offering - would they actaully go below the range to see if I would take it? Wouldn't that be unethical for a recruiter, or am I being naive?
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written by Kathryn Weber , February 09, 2010
I love DailyWorth. This article is so important -- how many women are there that are underpaid, and perhaps sadder still, don't feel like they DESERVE more. Well, they do. We all do. Hear, hear for a great article.
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written by Aviva Kleiner , February 10, 2010
Thanks for the great points. I'm definitely saving this email for future reference.

Here's a trick that really made me feel more confident and gave me more power when negotiating a raise. I made a list of all the things that I had done to save the company money and create a more efficient work place. By the time I was done I was proud to walk into that meeting and I felt my worth!!
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written by Mikelann Valterra , March 02, 2010
Great article! I would add this negotiating tip: "Always counter". Never just accept what you're given. Women are far too grateful for what they are offered! When you are offered a certain amount of money, respond with a counter. For example, if they offer you $50,000 in a salary situation, simply say something like, "Well, I certainly am happy with the prospect of working here. Given that I have (insert something they need/ some kind of experience you have) it feels like $55,000 would be more appropriate. How do you feel about that?" Of course everyone will say it differently, and it doesn't always work. But you've got to stand up for yourself. And negotiating is simply about having a two-way conversation. The point is just don't automatically accept what you're offered.
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