What if I told you that the simplest and fastest way to improve your finances might not be a side hustle, slashing your bills or living on beans and rice?
The best thing you can do to earn more money is to leverage the source of income that you already have – your job. That’s right, if you haven’t asked for a raise at work recently, I’m going to show you exactly how to ask for a raise at work, and how to actually get it!
For most of us, our job is our primary source of income. It’s the most valuable asset that we have, and you should try to leverage it as much as possible.
Getting a raise of $1 per hour is completely obtainable for most people, and it can make a big difference for your finances. If you work 40 hours per week, and $1/hr raise will increase your gross earnings by $2000 per year. That’s a lot of extra money to save, invest or pay down debt with.
If you’re overdue for a raise, you might be able to get even more. $2 per hour extra will pay for several of your bills.
Basically, it’s almost always worth a try.
Below, I’m going to show you how to ask for a raise at work and actually get it.
Do your research
Ok, so you’re ready to march into your boss’ office and ask for a raise right? Not so fast. You need to do a bit of homework first. Doing a little research will help you decide if you’re really in a position to ask for a raise and how much you should ask for.
Time Your Request
How often does your company carry out employee reviews? This could be every three months, six months, every year or even more.
I have worked for companies that have no policy on this, they just do whatever they feel is best. Regardless, you need to know the best way to handle this based on your employer’s typical review process.
If you aren’t sure how your boss typically handles reviews it might be good to make a couple of discreet inquiries with your co-workers to make sure you have a good understanding of the company’s policies. Your human resources department is another good place to check with on this.
What is the average pay in your industry?
Before you go asking for a raise, you need to know what the typical salary for your job is. This will frame the rest of the conversation. It’s easier to ask for a raise when what you’re currently making is below-average for your industry, and more difficult if you make above average.
Some great resources for figuring out what average remuneration is for your position and pay are:
How long has it been since you have had a raise?
If it’s been more than a year, you’re definitely due for a performance review and/or raise. Some industries will differ but one year is a good starting point.
You can discreetly ask around and find out how often your company typically does performance reviews and raises.
Who is the best person at your company to have this conversation with?
Do you know who actually has the authority to sign off on a raise? It might not be your immediate superior. Do a bit of reasearch to make sure that the person you sit down with is the person who can make it happen.
And last but not least…
Do you deserve a raise?
You should take an honest look at whether or not you actually deserve a raise.
Is your performance above average? Do you show up for work on-time (or early) every day? Can you back-up the quality of your work with real data? This is important. If your performance has been less than awesome the last while, consider waiting a few months while you make some changes to help ensure that when you ask for a raise, you’ll actually get it.
How to ask for a raise
Now that you’ve established that you deserve some more money, it’s time to talk about how to ask for a raise while giving yourself the best chance for success.
Every situation is unique, and the needs, wants and attitudes of employers can vary dramatically. That said, I’m going to show you some guidelines that will give you a better chance of getting the raise you’re after.
Know When To Ask
It’s not a good idea to ask for a raise when your boss is stressed about money. Try to wait until the end of a good week or preferably, a good month to give you the best chance to getting what you’re after.
Some other times to consider asking for a raise include:
- Near the beginning of a new fiscal year
- When the company has just brought on a major client or account
- You have just completed a big project
- When the company is generally doing well financially
Demonstrate Your Accomplishments
You know that you’ve added value to the business, now is the time to demonstrate the areas where you have added value to their business. Make sure that you’re focussing on things that are above the bare minimum.
You might be tempted to show your employer that you show up on time everyday. That’s nice, but it’s nothing more than what is expected of you. If you come in 15 minutes early to turn on all the lights and computers, that’s a different story. It’s a little above and beyond.
Some examples of ways that you might have added extra value to the business:
- Increased your sales or productivity (back this up with data)
- Saved or brought on a high-value client
- Taken on additional responsibilities above and beyond your job description
- Lowered the business’ costs in some way
- Worked extra hours to complete a large project on time
Aim High – Ask for more than you actually want
When you ask for a raise, what you’re really doing is entering a negotiation. Most of the time, it’s best to ask for more than you’re hoping to actually get. If they agree, then you’ve got a bigger pay raise than you planned on. If not, you can negotiate back down to what you wanted in the first place.
Talk About The Future
It’s a good idea to talk about your goals and plans for the future. It demonstrates to your boss that you’re planning to be around for the long term.
This will help your case as an employer is going to be more likely to invest in and promote an employee who wants to be with the business for a long time.
Focus On Why You Deserve A Raise (Not Why You Need It)
Most people could make a case for needing more money. The thing is, your employer doesn’t care. The management’s job is to keep the company running smoothly and profitably, so whether or not your car needs a new transmission or you want to go to Hawaii this year isn’t really relevant.
You can’t expect your boss to give you a raise just because you need more money. Avoid talking about what you need and instead focus on the value that you bring to the company.
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Don’t make threats!
Remember that there’s a reason that you’re working for the company. You’re not holding all of the cards here. Avoid making any statements that indicate you might leave if you don’t get what you want.
Even if you have another offer on the table, it’s best to see what your employer will offer you before they’re backed into a corner.
Asking for a raise when you have another offer on the table is a tricky situation to navigate. Here are some things to ask yourself:
- Do you really want to stay with this company?
- Why are you considering leaving for another job?
- What’s the minimum that it would take to make you stay?
- What to do if you’re turned down for a raise?
What if your employer turns you down for a raise?
No means not right now, it might not mean no forever. If you’re turned down for a raise, take time to think it through rather than reacting emotionally. There are several reasons that your boss might turn you down for a raise including:
- Your performance is not good enough to merit a raise
- Your attitude at work needs improvement
- The company simply can not afford to give you a raise
- You recently received a raise or another perk
If you’re turned down for a raise, ask some questions. Why specifically have you been turned down?
Ask them specifically what you can do to add more value to the business to achieve your target wage or salary.
Once you have established what you need to do in order to get the raise, ask when would be an appropriate time to meet in the future to re-address the situation.
It’s important not to leave this open-ended. This lets them know that you’re serious about improving your performance and earning your pay raise.
A good way to respond once you know why you’ve been turned down for a raise would be: “I know what I have to work on now, could we meet again in September and revisit this?”
Since they have already told you what you need to do to improve, they will have no reason to turn you down next time provided you hit your targets.
Sometimes it’s not all about money
If you don’t think that the company is in a position to offer you a raise, but your work performance has been awesome, why not try and negotiate a different perk?
There are lots of things you could ask for that would benefit you and your family a great deal and might be easier for the company to get on board with.
Some examples are:
- A compressed work week (four ten-hour days rather than five eight-hour days)
- Extra vacation time
- A company phone or vehicle
- Working from home part or full time
If you have been an outstanding employee and your employer is unwilling to offer you a raise, perk or commit to something in the forseeable future, you might be working for the wrong company.
It might be time to start looking for other opportunities.
Are you overdue for a raise?
Have you used any of these tips to get yourself a pay raise?
Let me know in the comments!
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You hit on a key point about the need to sell your value to your employer. The company doesn’t care that you “need” more money, they’re going to do what is in their best interests. And just showing up and doing a good job isn’t enough. You need to make yourself invaluable so they can’t imagine ever losing you. Not easy, but if you can prove your worth you’ll be in much better position to get a raise.
Absolutely Mike. I think everybody should read Seth Godin’s ‘Linchpin’. It’s all about how to become a more valuable employee.