Financial Fitness: Advice for women on how to ask for a raise – Fox11online.com

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Financial Fitness: Advice for women on how to ask for a raise – Fox11online.com

Image courtesy MGN Online.

GREEN BAY (WLUK) — Here’s another example of the gender pay gap. new study shows women are 25% more likely than men to be turned down for a raise when they ask for one.

Local financial professional Kevin Klug from Secure Retirement Solutions is here to talk about some common mistakes people make when asking for a pay raise and can tell us the right way to do it.

Rachel Manek: Women are already earning less than men, so this is another blow…

Kevin:

• In the U.S., women make about 79 cents to every dollar a man makes.

• Research shows it’s going to take 118 years before the gender pay gap closes globally.

• This new study is out of Australia and is a representation of pay differences in industrialized countries. It blows the old myth about women not getting a pay raise because they lack the ambition to ask right out of the water.

Rachel: What are some common mistakes people make when negotiating pay?

Kevin: 1. Not Asking

• One of the biggest mistakes is not even asking. A 2015 study found that 57% of workers have never asked for a raise and 28% of those people said it was because they felt uncomfortable doing so.

• However, the same study found that three quarters of the people who asked for a raise got one!

• This new study shows that men are 25% more likely to get a raise when they ask for it, but it’s not all doom and gloom for women. The study says younger women, under the age of 40, are negotiating a salary more successfully than older females.

• It’s a sign change is coming!

2. Bad Timing

• Your best chance for a higher salary is before you start the job.

• Once there’s an offer on the table, you know the company is interested in you, so your negotiating power goes up. Employers will be more willing to work with you if they really want you.

• If you don’t negotiate right off the bat you will struggle to catch up, because all raises and bonuses that are calculated as a percentage of your salary will be smaller as well.

3. Forgetting Other Factors

• One thing to consider is commute times. You could save nearly $ 5,000 a year if you only drove 20 miles a day instead of 50. (Based on 20 monthly work days, with gas prices at $ 2.25 and an intermediate car that gets 25 miles a gallon)

• On my website, srsplans.com, there’s a calculator to determine the cost of commute time.

• Other factors include benefit packages, the culture of the company or additional vacation days.

• All of these benefits also factor into your overall happiness. Is a higher salary worth it if you’re unhappy with your job?

4. Not asking for enough

• The average base salary increase for 2016 is right around 3%. But if you feel you’re worth more, ask for more. Just be ready to show your value to the company.

• Do your research. Find out what workers with similar positions in your area are making.

• Have a figure in mind before the negotiations start, that way when you are asked how much you want you’ll be able to back the amount up with facts.

5. Not making the most of it

• When you negotiate a higher salary, make it work for you.

• Put at least some of your extra income into your retirement savings by increasing your 401k contributions.

• The average retirement age, right now, is 62. But, a new study says today’s college grads will likely be working until they’re 75 before they can retire because they aren’t putting enough in savings. In addition to building up your savings, use your raise to pay down debt, especially high-interest debt like credit cards.

Rachel: When do you bring up a raise?

• Gauge the mood of your boss. A happy boss is more likely to consider your proposal.

• Also keep in mind how your company is doing. If things are going good financially, you’re more likely to get a raise.

• If you’re getting more lucrative offers, then it might be time to ask for a raise. Those offers will force your boss to look at you in a new light and really think about how much it would cost to replace you and how much trouble it would cause if you left.

Rachel: Any tips for negotiating a raise?

• Negotiations can be stressful. There is no doubt about that. And some employers just don’t have it in the budget.

• But, don’t feel the need to accept or negotiate right away. Research the offer, weigh your options and then decide.

• Be excited. An offer is an offer no matter if it’s low or not. Be gracious they’re at least considering you.

• Don’t forget to look at the whole package. Benefits or perks can make an okay offer into the offer of a lifetime.

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