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Ease your nerves and increase your chances of success by following a structured approach to preparing and asking for a raise. Keep in mind, inflation has decreased (even if prices haven't), interest rates are dropping and the unemployment rate has flattened around 4%. All of this means employees—especially top-performing employees—are generally in a good position at the bargaining table.
1. Routinely Record Your Accomplishments
Some employers offer an annual cost-of-living raise or adjust salaries based on the company's recent performance. However, you might have to make a case for why you deserve an additional raise that rewards your individual accomplishments.
Instead of sharing a long list of everything you've done, highlight a few occasions or projects where you went above and beyond. These could include:
- Praise from managers, coworkers or clients
- Details about what you did and how you did it
- How your work helped your team and the company
It may be easier to do this if you take notes and screenshots throughout the year. If you can, try to quantify your results. Perhaps you can show how your work directly affected the company's bottom line. Or, how you improved systems or results compared to the previous year.
Having an easy-to-share list can also be helpful if your manager needs to ask higher-ups before approving a raise. They can point to your accomplishment and will have a more powerful argument if they understand the context of your contribution and the results.
2. Gather Outside Statistics
Figuring out how your salary compares to what people with similar titles or responsibilities earn can also help your case.
You might be able to use this information to ask for a raise that brings you up to market standards. Or, you can use the list of accomplishments you've created to make a case for why you deserve more than the average.
Many people aren't willing to openly share their salaries, but you could:
- Research on salary websites. There are several large websites that collect and share anonymized hourly pay and salary info, including Glassdoor, Indeed, LinkedIn, PayScale and Salary.com.
- Look at job listings. Some cities and states have pay transparency laws that require employers to include salary ranges when posting open jobs. The ranges can sometimes be absurdly large. But gathering a few realistic ranges can help you understand the market rate for your role.
- Ask others. If you're part of networking or industry groups and have become friends with employees at other companies, you could offer to share your research and ask for their opinion about your findings. Don't pressure them to share their salary, but they might help you understand what's realistic in your area.
- Gather competing offers. Applying for jobs and getting competing offers can give you more subjective estimates of what you could earn elsewhere. You can use the offers to negotiate a raise, or consider taking the other job if it's a good fit and pays more.
- Contact recruiters. Recruiting companies and professionals sometimes focus on specific industries or roles. If you can connect with recruiters, they may be able to give you a good sense of how much you might be able to earn based on your experience.
Keep in mind that you may need to adjust your expectations based on where you live or where you're looking for work. Many organizations use their headquarters' location to determine pay ranges, even for fully remote workers. But some companies will base the pay range on where someone lives.
3. Be Specific About What You Want
Think about your specific goal and use your research to back up your request.
For example, if you want to increase your hourly rate or salary, you might be able to show that you consistently exceed expectations in reviews but have a below-market salary. From there, you can make the case that you deserve a specific percentage above the market rate to align with your performance.
There are also ways to increase your total compensation or improve your work-life balance without increasing your pay. Consider asking for:
- More paid time off
- Flexible hours
- Remote days
- Equity compensation
- New bonus opportunities
- Financial wellness benefits
- More interesting assignments
4. Practice Your Conversation
You don't want to go into a potentially nerve-wracking situation without a few practice rounds under your belt. You could ask a friend or family member to play the role of your manager. Or, there are career coaches who specialize in salary negotiation who could help you practice—and may be able to help with other aspects of the process as well.
Come up with a rough outline of how you want to start the conversation and what you want to share. Also, practice answering questions about why you deserve a raise, how much you want and what aspects of your role you'd like to change.
5. Start the Discussion Early
While you might want a raise today, timing your ask can be important. You don't want to catch your manager by surprise with the request, and you don't want to ask at an unrealistic time.
The timing can depend on your company's systems and policies, but you could try to:
- Schedule an initial meeting. Schedule a meeting with your supervisor to discuss your pay several weeks or months before a quarterly or annual performance review. If you don't have a formal review process, schedule the meeting after it's been at least a year since you were hired or last got a raise.
- Ask what would lead to a raise. Rather than asking for the raise right away, you could explain that you're hoping to get a raise and ask what would need to happen to ensure you get one.
- Share your key points. You don't necessarily need to present everything you've found, but try to pick three to five key points that highlight the value you bring to your role. You can also highlight any research that shows market rates are higher than what you earn.
- Consider your company's financial cycle. Even if your supervisor wants to approve a raise, they might need to wait until a new budget cycle begins. To avoid delays, try to find out when increases can happen and time your ask accordingly.
Even if you make a solid case, however, your supervisor's response could depend on factors that are out of their control, such as the company's overall success or the team's budget. Still, starting the conversation now could help put you in a good position when the funds do become available.
6. Schedule a Follow-Up
Unless you already got a "yes," try to end the initial conversation by scheduling a follow-up. It might be your performance review. Or, if you don't have one coming up, a separate check-in meeting several weeks later.
If you discussed what you'd have to do to earn a raise in the interim, make sure you follow through before the next meeting. And if your supervisor still isn't convinced, you can use this as an opportunity to share additional research or information that supports your request.
7. Have a Backup Plan
You might try your hardest and still get a "no" in response. Rejection can be discouraging, but feel out the situation and think through your options:
- Ask follow-up questions. Was that the final word or part of an ongoing negotiation? Ask about potential growth for your career and salary within the company and what needs to happen for you to progress.
- Earn a certification. If there isn't a linear path to progress in your current role, ask whether earning certifications could warrant more pay or help you move into a higher-paying career path at the company.
- Learn new skills. Even if there's no certification involved, learning new skills that you can apply to your job—or a new role somewhere else—could be helpful. You could look for free online courses as a starting point.
- Request training opportunities. You might be able to persuade your company to pay for a career coach or continued education that could help you qualify for a higher pay bracket or a higher-paying job later.
- Update your resume. If you're ready to leave your company, it might be time to update your resume and see if you can negotiate better pay—and potentially a sign-on bonus—at a different company. If you're not confident in your writing abilities, you can hire a professional resume writer or even employ artificial intelligence to get started.
- Earn extra money elsewhere. If you want to stay at your company but need an income boost, look into flexible side hustles that you can use to supplement your income.
If you decide to leave your job, find out what happens to your employer-provided benefits, such as health insurance and retirement accounts. Consider how the changes will impact your finances and whether you need to have another job lined up before you leave.
Learn more >> Ways to Make More Money Without Asking for a Raise
How a Raise Could Impact Your Credit
Although increasing your income won't directly impact your credit score, it can affect your creditworthiness in several ways.
For example, a higher income can lower your debt-to-income ratio, which creditors may consider when making lending decisions. It can also make paying your bills easier, and on-time payments are an important factor in your credit score.
Additionally, if you report your increased income to your credit card issuers, they might increase your credit limit. A higher credit limit can lower your credit utilization ratio, which could help your credit scores.
If you want to track how these changes impact your credit, sign up to get your credit report and FICO® Score☉ for free from Experian. In addition to monthly updates of your credit report and score, you'll receive real-time alerts when there are important changes to your credit.