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[Prefer to listen? You can find a podcast version of this article here: E149: How to Ask for a Raise]

Most of us have a goal of increasing income over time. More income means more freedom, faster progress toward goals, and more financial security. W-2 employees, this means sometimes asking for more compensation. However, it’s not always easy.

Asking for a raise can be challenging for several reasons:

• Fear of rejection: Many employees fear that asking for a raise may result in their employer denying the request or even causing harm to their job security.
• Lack of confidence: Some employees may lack the confidence to approach their employer and ask for a raise, especially if they feel that their job performance has not been outstanding.
• Inadequate preparation: If an employee has not prepared adequately for the conversation, they may not be able to effectively argue their case for a raise, or may not know what kind of raise to ask for.
• Lack of knowledge about company policies: If an employee is not aware of the company's policies and procedures for awarding raises, they may struggle to have a productive conversation with their employer.
• Timing: Asking for a raise at the wrong time, such as during a period of economic uncertainty or during a performance review, can be less effective.

Asking for a raise can be challenging, especially if you are talking to your manager or the owner of a small company. Some people are either too shy or too afraid to bring up the topic of compensation. They may not bring it up during their annual reviews and simply accept what is offered to them.

While this approach can work if you have a great boss or work for a well-organized company, it can also lead to being underpaid. On the other hand, some organizations may have a rigid formula for compensation that doesn't leave room for negotiation.

In general, many people don't bring up the topic of compensation because it can be uncomfortable, but this can result in them being underpaid throughout their careers.

The other side of the coin is that some people take an aggressive approach to asking for a raise. They may demand a certain amount of money or threaten to leave if they don't get it. While this approach may sometimes work, it can also create conflict within the organization and cause tension between the employee and their manager. Being too aggressive and ultimatum-driven is not always the best way to approach asking for a raise.

So how do you ask for a raise?

When asking for a raise, it's important to approach the conversation in a productive manner that is also friendly and respectful to your manager or boss. The first step in the process is to document your value to the organization. You want to make sure that you are armed with clear, documented examples of the value you have brought to the company.

This could include projects you have been involved in that have been successful, ways you have saved the company money, ways you have increased market share or growth, and any other valuable contributions you have made.

It's important to write these examples down in a document that you can refer to during the conversation.

This may take some time, as it's easy to forget about some of the wins you've had. However, taking the time to reflect on your past contributions can be a great mental exercise and boost to your confidence. It will help you see the value you bring to the organization and can be a great motivator as you prepare to ask for a raise.

The next step in asking for a raise is to research appropriate salary ranges for your position. This can be done by using websites like Glassdoor or salary.com, but it's important to also consider other sources, as some websites may not be accurate. Additionally, you can talk to others in your field or similar positions in other companies to get a better understanding of the salary range that is fair for someone with your skills and experience.

When you are researching salaries, consider factors such as the size of the company you work for, the industry, and the location. These can all have an impact on the appropriate salary range for your position.

Once you have conducted thorough salary research and have a clear understanding of what is fair, you can determine a fair wage for yourself. Based on your current salary and the research you have done, you may determine that you would like to reach a certain salary within the next 1-2 years.

Now you’re armed with documentation demonstrating your value to the organization as well as compensation figures to support your assertion that high pay is appropriate.

So how do you approach the conversation?

The key to good communication in this situation is to keep it collaborative. Start by “tooting your own horn” a bit. Review the wins that you documented and talk about how excited you are that you were able to accomplish such great things over the past year or two. Superman pose, prep yourself for the meeting

Then talk about your desire for greater compensation. Frame it with phrases like “I’d like to talk about compensation for a few minutes” and explain your findings from your salary research.

Then, use this key phrasing as an example of how to make the ask: “I would like to get to a compensation level of ________. How can we work together to get there?”

That is a very different way of framing the conversation. So instead of saying, “I deserve this” or “I want to be paid this or I'm leaving” you're saying, “hey, I am interested in getting to this point in my compensation.”

The tone is “let's work together to see how we can get there.” This basically puts the ball into your manager's court to respond and it's very non-confrontational.

It's a collaborative question. It's a way of letting your boss know that you are paying attention and that you know your value.

Depending on the type and size of your employer, this may go a few different ways. In a small business, your boss may be the owner and may be able to make decisions very quickly. In a larger organization, there may be more red tape and processes to go through.

Either way, you are taking greater responsibility for your career path and your income.

So is asking for a raise easy? No, it’s not always comfortable to talk about money and compensation. But framing it as a collaboration can make the conversation less stressful and more productive for both you and your employer, and can lead to greater increases in income over time.