It’s a high risk answer — you want to get it right.
One of the most unfair questions you can be asked during a job interview is: What salary were you expecting? This question is not only potentially unethical, but it also violates one of the cardinal rules of negotiation, which states that whoever speaks first, loses.
Of course, it makes sense that employers would ask this question–they are trying to get top talent at a discounted price. That’s why it’s quite likely you might find yourself in this scenario speaking to an employer you want to work for. If that’s the case, what do you do? The good news is that you have a few advantageous tactics you can employ without blowing your shot at landing the job.
1. Tell them your current salary
While I don’t really recommend taking this approach, the easiest answer you can give to someone when you’re asked what you want to make is to tell them your current salary level. You could then frame your answer by telling them that you hope to make more than that figure if you were to make a change. Don’t forget to include bonuses and any stock options when you give this answer. In this scenario, you are truly putting a lot of trust in the employer to do right by you. But then again, you don’t have to take the job if they go cheap.
2. Name your number
Another option is to take whatever you currently make and build in a healthy raise–like 25 percent higher–when you answer the question, and then see what happens. There’s no harm in saying you want to make $125,000. By doing this, you will have come up with a number that you’re happy with and that would be worth changing jobs for. This is how generations of people have typically negotiated their pay. The risk here, of course, is that you might be underselling what the company would be willing to pay for the position.
3. Research the market
It used to be that people walked into new jobs with the simple expectation that they wanted to make more than they currently were. That’s because there was information asymmetry: Only the companies really knew what they were paying people in your position. It was similar to how buying a car worked. It was always an exercise in negotiating down from the sticker price; only the seller truly knew how much they paid for that car. Today, that’s completely flipped. You can go online and research every bit of car and know exactly how much the dealer paid for it. We’ve now entered an era of information symmetry.
Well, it turns out that’s true for salary information as well. Thanks to sites like Salary.com, you can now research the median salary someone in your position and in your geography can expect to be paid. It’s useful to know, for example, that the same software engineering job that pays $90,000 in Raleigh, North Carolina, would be worth $140,000 in Silicon Valley.
By doing your homework, you can then answer the question in an interview by saying something like: “I have done the research on what this position is worth and it’s my understanding that the median pay is $125,000.” This is a great way to shift the conversation away from being personal and making it market and data based instead. Frankly, the hiring company probably did exactly the same research to set the pay range for the job.
4. Market plus
A fourth option is to trust that the company might actually be willing to pay more than the median market level to attract top talent. While some companies target the 50th percentile (about average in their market) when setting pay philosophy, others might be willing to go higher, like the 75th. That means if you answer the question using the median number, you might actually be putting yourself at a disadvantage.
You can get potentially around this wrinkle by answering the question with: “I know you will pay the market rate if I’m qualified, but I have an expectation of making above the median market based on my skills and experience.” If you are willing to put some of the premium above market at risk in the form of a performance bonus, you will have a real shot at getting it.
This way you have shifted the dynamics of the conversation to showing that you know what the median market rate is, and that you’re hoping to do better than that. Hopefully the company will then come back to you with an offer that you’re pleasantly surprised with.
So, when it comes to your next interview and you’re faced with the question of how much money you want to make, it can really pay to do your research first to at least know what your job might be worth and what you’re willing to take. Otherwise, you can take a chance on being transparent and hope that your new employer is generous and willing to pay you well.