Strategies for Securing A Raise and Advancing Your Career
For many people, the new year signals a compensation review with their employer. Compensation reviews can be intimidating and often dreaded, but they are obviously extremely important. Securing a raise not only affects your immediate budget and spending power, but it also impacts your future retirement. Contributions to your 401(k) and social security are typically based on a percentage of your income so more money today usually means more saving for the future. So how can you secure a raise at work?
According to the Payscale Salary Budget Survey, organizations are planning on salary increases of 3.8 percent on average in 2024. Inflation last year (between November of 2022 and November of 2023) came in at about 3.1% so if you’re average, you will see about a .7% increase in your purchasing power this year. That’s great news! (Well, it’s better than raises that don’t keep up with inflation anyway.)
But what if your employer proposes a raise that is less than average? Or what if you think your work warrants more than a .7% increase in purchasing power? You must prepare in advance to advocate for yourself.
How to Prepare for Your 2024 Compensation Review
Know Your Numbers
It’s a great idea to go into a compensation review armed with facts. Know how much of a raise you’ve gotten in past years. Did those raises keep up with inflation?
If you’ve gotten meager raises in years past, it is possible that you’re making LESS today (when you factor in inflation) than you were a few years ago.
In 2021, inflation came in at 4.7% and in 2022, inflation was a whopping 8%. In order to secure a REAL raise (one that actually increases your purchasing power) in 2024, It’s important to know how your past raises have stacked up!
Know Your Work
Responsibilities within our jobs change all the time. Maybe you’ve been taking on new responsibilities throughout the year without any adjustment in pay. Be prepared to remind your employer about this additional work that may have been forgotten or overlooked. Spend some time prior to your review making a list of how your position has evolved in the last year or so. Take that list with you when you go into your review.
We have a tendency to assume that our employers recognize how our work contributes to the profitability of the organization. In reality, probably no one understands this better than you do. If you’ve been responsible for ideas that have reduced expenses or improved profit margins for your company, be prepared to articulate those things to your employer. Demonstrating your value to the organization is key to securing a raise in pay!
Know Your Worth
If you are a loyal employee, the sad reality is that your employer may be taking you for granted. If your employer feels confident that you will never leave your position, it is possible that larger raises may go to the people within the company that your employer fears losing.
According to Pew Research, people who change jobs are seeing “real” wage gains (gains that exceed inflation).
Being loyal to your employer SEEMS like a good thing… but is it really loyalty, or do you just lack confidence to branch out?
If you knew you could not fail at a new endeavor, would you still stay loyal to your employer?
If the answer is no, you might be lacking in confidence and passing it off as loyalty. Start working on knowing your worth. Build your confidence. Seek mentors. Join professional networks!
Women, here’s the reality: study after study shows that we are making less money than our male counterparts for the same work. There are many reasons why this is still the case, but I think lack of confidence is one of the biggest ones.
We’ve probably all heard the statistic that men will apply for a job if they meet 60% of the qualifications, while women typically don’t apply for a job unless they meet 100% of the qualifications. If these statistics are accurate, men are applying for more jobs, and statistically achieving more real wage gains when they make the switch.
Lack of confidence sometimes masquerades as loyalty. This could be holding your career back and ultimately contributing to the pay gap problem. Knowing your worth and having confidence in it is absolutely vital to securing the raise you deserve.
Know Your Options
Before your review, look around at other jobs currently available in your field. Knowing how many jobs are available in your field and how much they pay can be extremely helpful in salary negotiations with your employer.
Additionally, analyzing the qualifications required for these jobs can help you identify any skill gaps you might have so that you can create impactful personal development goals. Great personal development goals help keep you marketable and motivated – ultimately that helps you build confidence!
When compensation review time comes around, be prepared! Know your numbers, know your work, know your worth and know your options.
You’ve got this! Go get a raise!
Impact Wealth Management LLC is a fee-only Registered Investment Advisor (RIA). We are based in beautiful Sioux Falls, SD and regulated by the State of South Dakota. Throughout this site, we went out of our way to present unbiased data believed to be from reliable and respected sources. However, its accuracy, completeness, and relevance are not guaranteed, and no responsibility is assumed for errors or omissions. This article is meant for education purposes only and should not be interpreted as legal or financial advice.