Negotiating your salary and compensation package is an area of the job search process that gets far less attention than interviewing and networking. But if you’re fortunate enough to make it through three rounds of interviews with people at the firm, personality tests and perhaps a case study or two, and finally receive an offer, then you want to get this part of the process exactly right as well.
Industry insiders agree on a few major steps and rules in the negotiating process. First, get comfortable about negotiating. You may have so much time and effort invested in the interview process that you’re ready to jump at the offer (especially if this is your first job in investment banking). But keep in mind that any prospective employer expects you to negotiate. Anything less would be selling yourself short. Negotiation demonstrates that you value your skills and what you bring to the firm, and want to be properly compensated for it.
Second, think of the negotiating process as a win-win situation. You are not trying to outsmart the employer but instead, trying to reach an agreement that suits both of you as much as possible.
The most important step in negotiating your compensation package is upfront research. Check out compensation surveys online, such as Job Search Digest’s annual compensation surveys, and our ongoing job lists for positions like the one you’re seeking. These will give you an accurate idea of what other firms are offering. You can also check online compensation surveys at www.wallstreetcomps.com or www.payscale.com
Research will help you develop a specific salary range that you are willing to entertain for your own compensation. The industry stats will also be useful when you get into the actual negotiations, as way of proving what you are asking for falls within industry norms.
By the way, many experts recommend that you NEVER bring up the subject of salary or compensation first. Avoid discussing the topic until they have actually made a job offer. Simply deflect the question with a “we can work out the compensation details later on.” Not talking about salary or compensation gives the impression that you are more focused on the job itself, rather than just the money.
If an interviewer is intent on finding out exactly how much you want, it could indicate that they are just “kicking the tires” or perhaps do not have a decent enough budget to hire and pay a qualified person what they’re worth. Either way, keep your cards close to your vest, as they say. You do not want to commit to a salary range that is lower than they are willing to pay. Nor do you want to devalue their perception of what you are worth by quoting a low range, or put a premature end to the interview by quoting too high a figure.
Next time we’ll talk about when you should begin a discussion of actual salary numbers, and how to negotiate a job in investment banking from a position of strength.