8 Signs It’s Time To Ask for a Raise
If you aren’t being paid what you’re worth, it’s important to ask for a raise. Read on for tips on how and when to ask for a raise.
January 4, 2022
We all want to be paid appropriately for what our time and skills are worth. And with inflation on the rise, we expect salaries to keep up with increases in cost of living.
If you feel like you’re being underpaid, you’re not alone. A recent PayScale survey found that more than 50% of survey respondents believe they are underpaid in their role.
However, the Bureau of Labor Statistics reported that the average compensation rose 3.7% in the twelve month period leading up to September 2021 — the highest annual increase in many years. This trend shows that companies are increasingly willing to pay more for labor, particularly in this tight job market.
Of course, not all employers will issue raises automatically. Sometimes, workers must ask directly for a pay increase.
Timing matters, though. There are certain career milestones, times of the year, etc., that are more appropriate for salary negotiations. This guide will discuss when to ask for a raise, as well as how to go about talking to your boss.
When to ask for a raise — 8 signs it might be time
Asking for a raise can be awkward, and many of us dread it, but it’s important to further our careers and improve our financial standing. Here are eight signs that it may be time to ask for a raise:
You’re underpaid for your position, based on market averages
If you are being paid less than the market rate for your position, this is a great time to ask for a raise.
You have additional responsibilities at work
If you’ve recently been tasked with new responsibilities in your role, this could be the leverage you need to ask for a raise.
Many companies will try to load more work on existing employees instead of filling a new role. In these cases, employers may have room in their budget to increase your pay.
You have another job offer
An actual job offer or offer letter from another employer is perhaps the ultimate bargaining chip in salary negotiations.
In this scenario, your current employer may be willing to negotiate in order to keep you on board.
You can negotiate with your potential new employer and your existing employer at the same time, but try not to burn any bridges in the process.
You received a promotion
In some cases, companies will offer promotions without any pay increase, or perhaps with a small raise of just a few percent. This is a good time to ask for a raise. You may also wish to research the average market salary for the new role to be prepared for salary negotiations.
Your employer may lose money or business if you quit
If switching jobs to a new company would cause your employer to lose out financially, they may be more willing to give you a raise. For instance, if you are on the sales team and are directly involved with bringing in business, you may have significant bargaining power.
You expect a positive annual review
Many companies conduct annual reviews for their employees, often toward the end of the calendar year. If you’ve done a good job, your boss should tell you so with a positive annual review. This is a great time to capitalize on the positive momentum of your review and ask for a raise.
You recently created something valuable for the company
If you recently finished up a large project, launched a new product or fixed a significant problem, this provides good bargaining power for salary negotiations. For example, if you fixed a costly error, landed a big client or designed a beautiful annual report, now might be a good time to ask for a raise.
It’s been years since your last raise
Ideally, wages should keep up with increases in the cost of living. Many employers offer cost of living adjustments, typically based on the rate of inflation. If it’s been several years since your last raise, it’s a good time to ask for one, particularly given that the inflation rate has been quite high recently.
How to talk to your boss about a raise
Now you know when to ask for a raise, but what’s the best way to ask for a raise?
In most cases, you’ll want to set a meeting with your boss at work. Try to think about the times of week that your boss may be in a more receptive mood — Friday afternoon, perhaps.
In the meeting, briefly explain that you would like to request a pay increase and give the reasons why you believe you deserve one. Come prepared with salary data for similar roles in your area as well as a list of your recent accomplishments at work.
When it comes to how to ask your boss for a raise, there are a lot of variables. For more tips, read our full guide to negotiating a raise.
Finally, remember that money isn’t everything. If your employer is unable or unwilling to give you a raise, you may be able to negotiate better benefits instead, such as more paid time off.
Further your career and your finances
Asking for a raise can propel you toward better financial security and hopefully more job satisfaction. For more tips on careers, saving and personal finance, check out Tally’s blog, The Score — and don’t forget to sign up for Tally’s newsletter.