Have you ever felt like the quality of your work deserved a raise, but you were not sure how to approach this difficult conversation?
You’re not alone.
According to Salary.com, only 12% of people make it a point to negotiate their salary in an annual performance review.
If you’re looking at increasing wealth in your life, there is one sure fire way to do that:
Spend Less. It’s easier to think about spending less because we feel it’s something we can control.
The world of personal finance loves to talk about cutting back, budgeting, spending less. It’s far less common to talk about the other side of the coin:
Earn More. It’s harder to think about earning more, because we feel it’s something we can’t always control.
Salary increases are another way to earn more money, especially if you are a high performer and enjoy the place where you currently work. But when you ask people why they hesitate to ask for one, the most common responses are:
- I’m worried about losing my job if I ask
- I don’t want to come across as greedy
- I find negotiating utterly unpleasant
- I am worried it will destroy my relationship with my boss
- I’m lacking the confidence to ask
Any of these ring true for you?
Although a raise may feel slightly outside of your control (or even your comfort zone!), we have a massive opportunity to influence the decision.
Now there is a right way to ask for a raise and a wrong way. The obvious wrong way is to storm into the bosses office during your annual review and demand one. Another mistake is to assume you deserve one because of how long you have been with the company.
But there is another option. I want to share with you a formula that I learned from Ramit Sethi that will significantly boost your odds of getting a raise, without causing anxiety or destroying your relationship with your boss.
Now this is not a quick hack, or a trick to deceive your boss. It does require time, real work and effort on your part. But if done correctly, your boss will be excited to offer you a raise.
The secret sauce is all about how you frame it, how you prepare for it, and how you present it.
Learn what it means to be a top performer
The people who are most likely to get a raise are top performers. But how are you supposed to be a top performer, without understating exactly what that means?
Being a top performer will vary wildly depending on your role. If you are in marketing, a top performer might mean improving conversion rates by 10%. If you are in sales, a top performer might mean closing £1m in revenue. If you are in the people function, a top performer might mean reducing employee turnover by 25%.
You need to figure this out. You need to ask. You need to get specific.
Your first objective should be to set up a quick meeting with your boss and define what it would take to be a top performer in your role. Imagine your boss receives an email like this:
What do you think your bosses response will be?
In the meeting you can explain that you don’t want to be an average performer, you want to be at the top of your game, and you would like to discuss exactly what you can be doing to get there. Your boss may immediately know what a top performer looks like, but chances are they won’t. Or it will be vague and not specific enough.
If that’s the case, you can take this opportunity to share what you believe makes a top performer in your role. For example increase sales by 20% this year. It can make your bosses job even easier if they don’t need to think about it.
Your main goal here is to get clear confirmation around what a top performer looks like in your bosses eyes.
Plant the seed
Once you get that confirmation of what a top performer looks like, you are ready to start making some commitments.
It might go something like this:
“Hey boss, I think we can hit a 20% growth rate. Here is how I would like to approach it. I would love to get cracking on this project. At the end of 6 months, I would be keen to meet again and show you our achievements. Would that be ok?”
Pause for an emphatic YES...
“Great. If we achieve what were are setting out to do, I would love to come back and talk about a salary adjustment, but lets not worry about that now, I want to focus on this. How does that sound?”
Pause (again) for an empathic YES...
This is called laying the groundwork. Take a look at what you have done so far:
- You have expressed incredible desire to become a top performer (versus an average player)
- You know exactly what it means to be one
- You have made some commitments on what you can deliver
- You have framed a conversation in the future around salary expectations
Everyone (including your boss) knows that top talent is worth paying for. If you can prove you are one, then it will put you in a seriously strong position for your meeting in 6 months time.
Supercharge your negotiations
Fast forward six months and you have a meeting in the diary with your boss to reveal your achievements.
There are a few ways you can add an extra boost to your negotiations.
You can ask your colleagues who worked with you on your project to put in a good word (or email) to your boss about your performance (make sure they don’t all email at the same time the day before your meeting!).
You can research your average salary range on Salary.com for your particular role (see image below). Now you know your “ average market value”, you can share why you are deserving of more as a top performer.
You can prepare and present your results in a super clear report, even theatrically pull a report from your briefcase (called the briefcase technique) so the boss needs to do very little work to understand your achievements.
You wanted to be a top performer, your boss wanted you to be a top performer, and now you have proven beyond a shadow of a doubt that you are.
I love Ramit’s quote around salary negotiations:
“All the work is done before you set foot in the room”
Go for the ask!
You have now earned the right to discuss your salary adjustment. Your boss should already be primed for it, and actually welcome it!
You are loved by your colleagues, you are exceeding targets, all while making them look good.
Everyone is happy.
The final step in the process is to go in for the ask.
“Hey boss, I’m super pumped about the work we have done and all we have accomplished this year. I know we talked about having a conversation around my salary, I would love to chat about that now.”
This is not a fast process, there are no shortcuts. But there is a formula to frame this negotiation in a positive way, make it non confrontational, and making it super easy for your boss to say YES!
❤️ Patrick & TOMII Tribe
What We're Watching 🍿
The Briefcase Technique - Ramit Sethi
Ramit has helped thousands of people negotiate raises at work in a non confrontational way. The briefcase technique ads a little showmanship and theatrics to your negotiations.
What We're Doing 🤩
Life Dinner (It's tonight for us!) - Thanks to Brad Feld for the inspiration
What's Life Dinner?
It's a designated time, once per month, where my wife and I sit down and discuss our finances. We either cook a nice meal at home or go out to a restaurant. It helps us communicate openly about money and see if we are still on the same page when it comes to our financial goals, our investments and our lifestyle.
(Are you single? No problem. Do it with a friend or family member.)
What We're Pondering 🤔
A stoics views towards money:
“You should not trade too much of the most precious asset in the world (your time) for an incredibly common and infinite thing (money).”