How to Negotiate a Job Offer: Your Complete Guide

A lot goes into a job offer. From the first moment you send your carefully constructed, customized resume until you finally receive the offer you’ve been dreaming of, you’ve likely spent a huge amount of time, energy, and effort – and you haven’t even started the job yet!

We all know that work can become a massive part of your life. Beyond the fact that many of us spend 40 hours or more at work each week, your job can impact your life outside of office hours, too. Sure, your job affects the way you spend time during the workday, but things like vacation time, benefits, salary, and other perks can change the way you spend your time on weekends, where and when you go on vacation, and your overall quality of life.

When you finally do receive that all-important job offer, it’s generally understood that you’ll negotiate for various perks and benefits that can help improve your life – inside and outside of work. But how do you go about that? What should you look for in your offer, what can you negotiate for, and how do you turn a job offer into a dream job offer? Look no further: we have your complete guide to negotiating a job offer right here.

Your Salary and Benefits Package

When people think about what a job offer can provide them with, they’re usually thinking about the salary and benefits package. These two elements of your offer, plus any additional items such as stock options, vacation time, family benefits, bonus structure, and lifestyle perks, combine to form your total compensation package, or “total comp.” It’s important to keep your total comp in mind when receiving a job offer – it may be that your salary is lower than you anticipated, but the rest of your package could contain items that combine to give you an overall much higher compensation or lifestyle boost.

While nearly everything could technically be up for negotiation in a job offer, remember that companies usually only expect for you to negotiate your salary. Before you open discussion on other benefits, your base salary should be your first consideration.

How to Negotiate a Higher Salary After a Job Offer

The first thing to remember when negotiating a salary once you’ve received a job offer is that it’s normal and even expected to do so. Many people take an initial salary offer at face value, even if they believe they should earn more. Not only does this mean you’re unhappy with an aspect of your job before you even start it, this unhappiness could lead to resentment down the road and further decrease enjoyment of your work. According to a 2020 report by Randstad US, 60% of women say they’ve never negotiated with an employer before. Additionally, 72% stated they’d rather leave an employer to receive a higher salary elsewhere, which could potentially have negative consequences to their career at large.

Even if you don’t enjoy the potential awkwardness of negotiation, negotiating your salary is a skill that can be mastered, just like any other. To start you off on the right foot, here are a few steps you can start to take while you’re still job searching to ensure that, when that offer finally arrives, you’re prepared.

One: Know Your Worth

A lot can go into a salary negotiation: in essence, your goal is to demonstrate how much you would mean to a potential company and to be paid appropriately for that value.

Knowing your worth can mean two different things when it comes to a salary negotiation. First of all, you should enter negotiations having thoroughly researched comparable salaries in your field. Websites like Glassdoor and Indeed allow you to search average salaries for specific titles in different regions. If you understand what the average salary is across the country for your job, you’ll know as soon as you receive an offer whether the base salary is lower or higher (fingers crossed!) than that average. If you find that the salary is significantly lower than the averages you’ve found, that’s an excellent jumping off point in your negotiation strategy. Ask the recruiter clarifying questions – maybe the total compensation package makes up for the difference.

Keep in mind that some companies, especially large remote companies, often adjust salaries based on your location. For example, if you live in a high cost of living area such as New York City or California’s Bay Area, your salary might be higher to account for cost of living. Likewise, low cost of living areas may see lower salaries because companies know their employees in those locations have fewer expenses.

Secondly, knowing your worth also means knowing what you, specifically, bring to the table. You may find it useful to create a “highlight reel” document for yourself, pinpointing the biggest achievements you’ve earned so far. That way, if you know that the company is seeking talented graphic designers, you’re prepared with specific examples about exactly how talented you are and what an asset you’d be to the team.

Two: Be Realistic

Of course, everyone would love to make $500,000 a year. But is that number actually realistic for your experience, the job, and the company? Most of the time, no.

This is where your research comes back into play – you should understand what the average salary is for your job title and level of experience in your area. If you have a specific skill, degree, or experience that you feel puts you above that average, you should be able to argue for that additional amount based on your own assets. Knowing the average salary for your job title means it will be much more difficult for companies to low-ball you, but it also means you’ll need to be realistic about what your base salary. It’s not uncommon for companies to offer above market average salaries to attract exceptional talent, but you should understand that it would be extremely unusual to successfully negotiate, for example, double the industry average base salary if you aren’t bringing skills to the table that literally no one else possibly could.

Three: Confidence is Key

We’ve already said it, but it bears repeating: negotiating is a normal and often expected part of being offered a new job. Employers shouldn’t be surprised, offended, or annoyed that you’re looking to negotiate the best possible total compensation package for you and your lifestyle – after all, happy employees are more productive and less likely to quit!

If you’re negotiating in person or over a video call, keep your body language relaxed and confident. Keep your head high and smile. James Clear, author of Atomic Habits, insists that starting negotiations off on a positive note is “very important, no matter how small it is.”

You may find it helpful to strike a couple of “power poses,” listen to your favorite music, or enjoy a coffee before you write that negotiation email or enter the meeting. Do whatever you need to remain confident – have a lucky pair of underwear? Time to pull them out of the drawer. Psychology Today reports that people are more likely to receive a raise if they ask on a Thursday – if that makes you feel better about asking, try to negotiate at the end of the work week. Whatever it takes!

Four: Organize Your Thoughts

When you’re sharing every great thing about you and your work history, it can be difficult to keep your thoughts together. Have you ever started talking in an interview about a great moment you had at work, only to realize that by the end of the story you’ve forgotten what the question was in the first place?

Whether you’re negotiating via email or in-person, keeping your thoughts organized is crucial. At the end of the day, a negotiation is about weighing what you offer up against what the company offers, and striking a balance between the two that works for everyone. If you come prepared with a list of reasons why you deserve the number you have in mind, it’ll be easier for both sides to understand the details of the negotiation.

Five: Remain Positive and Appreciative

No one wants to negotiate with a grump! If you’ve reached the negotiation stage with an employer, it’s likely that you’re excited about the prospect of working with them – and it’s okay to let that show! In fact, sharing your excitement with the employer can set the tone for a positive negotiation experience. Begin the conversation by thanking the employer for their time and the opportunity to work with them. Let them know how excited you are about the offer and the company (you can even cite specific elements of the job you discussed during your interviews), and then you can ease into negotiations confidently.

How to Negotiate a Job Offer with a Counter Offer

You should always enter negotiations with a few numbers in mind – the minimum you’d be happy with, the number you’d ideally like to reach, and a “stretch number” you might consider reaching for if negotiations seem to be going particularly well and you can back your request up with plenty of concrete information about why you deserve it.

Some people like entering a more formal negotiation process, where both parties understand before beginning that they’ll be negotiating. Others like to simply reply to an offer with a counter offer. Both systems have positives and negatives. Formal negotiations sometimes mean the employer already has the go-ahead to raise the compensation package up to a certain amount, so your job becomes trying to reach that top figure in a reasonable manner. An informal counter offer might earn you points for confidence, or get things done more quickly because the hiring manager only has to respond to your offer with either an acceptance or a counter of their own.

If you’re responding to a job offer with a counter offer, begin in the same way you’d begin a negotiation meeting. Reiterate your appreciation for the opportunity and excitement about the position, and thank the hiring manager for their time and the initial offer. Then, you can provide your target compensation and state that you’re open to discussing several different options – for example, if you’d settle for a lower salary if you had an extra week of vacation written into your offer, that’s something a hiring manager should know. Of course, if you’re only interested in negotiating your base compensation, that should be mentioned, too!

Salary Negotiation Email Template

From here, you can take your email a couple of different ways. If you feel as though the offer is below market value, you can continue with the following:

If you think that you can bring something to the job that no one else can, you can take this opportunity to make that clear. Try something like:

Or, perhaps you’re in the enviable position of fielding multiple job offers! If that’s the case, you can try finishing this email with:

Regardless of why you’re entering negotiations after a job offer, always remember to sign off your email politely and reiterate your interest in the position. The recruiter may respond and say they can offer your preferred salary, or they might come back with a counter-offer. Either way, remembering your numbers – the ideal, and the lowest you’ll go – is crucial at this point.

Salary Negotiation Email Example

Stock Options in a Job Offer

Some companies – especially tech start-ups – offer stock options as part of their job perks. For most, the thought behind offering stock options involves one major benefit to employers – employee loyalty. If employees are part owners of the company, the theory is that they’ll work harder to grow and improve it.

What is a Stock Option?

A stock option is just that – the option, or opportunity, to purchase a predetermined number of shares of company stock at a set price within a set time period. Usually, the price of the stock – called the “grant price” or “strike price” – is a discounted price of company stock at the time you’re hired.

Stock options aren’t free shares in a company. Exercising your stock options, or purchasing shares within the set limits of the company, is always completely optional. In general, stock options begin to vest after you’ve been with the company for one year. Typically, more of your stock options will vest each month following that initial one-year period. Once your stock options have vested, you own the stock, and can choose to hold onto it or sell it.

If stock options are included in your offer, carefully read the language in the offer and ask plenty of questions if you have them. You should know what the vesting schedule is for your stock options, if you’ll be granted further options in the future. Also, consider the overall value of the company – are the stock options actually worth anything, or is the company trying to pad a low salary with stock options that won’t necessarily make you more money?

In general, stock options are difficult to negotiate because the practice of offering stock options is relatively new and not in practice in many industries. If stock options are important to you and you’d like more than you’re offered, you might consider negotiating to have an annual bonus paid in options instead of cash.

Negotiating Benefits

Benefits such as stock options aren’t as commonly negotiated, but if a certain aspect of a job is important to you then you should absolutely consider negotiating to ensure you get exactly what you’re looking for out of your next job.

When we talk about negotiating benefits, we don’t mean things like health insurance of 401(k)s – in general, those are set by third-party companies or organizations, and there’s not much that a company can do to change or improve upon them on a case-by-case basis. In this case, “benefits” describes things like vacation days, bonuses, parental leave, student loan repayment, working from home, and lifestyle reimbursements.

Types of Benefits

When we talk about negotiating benefits, we don’t mean things like health insurance of 401(k)s – in general, those are set by third-party companies or organizations, and there’s not much that a company can do to change or improve upon them on a case-by-case basis. In this case, “benefits” describes things like vacation days, bonuses, parental leave, student loan repayment, working from home, and lifestyle reimbursements.

Work Location Benefits If the last few years have taught us anything, it’s that the physical location of your office can mean a lot. Whether you’re the type to want that in-office banter or you love the work-from-home life, there are negotiable benefits you can get in writing to aid or maintain that lifestyle.

If you’re relocating for a job, relocation assistance is a common benefit, and you’d be wise to negotiate for it, even if you have relocation expenses under control. Likewise, some companies provide reimbursements for commuting expenses such as gas, car insurance, or public transit costs. Lastly, many people are able to negotiate for a certain level of working from home. Maybe you’d like to be in the office for three days a week and your home office for two – a good negotiation can give you that in writing. If your new company is remote-first, you may also receive a stipend or other benefit for setting up your home office just the way you like it.

Financial Benefits We’ve already talked about stock options, but what other financial benefits can you use to pad out that base salary?

The most obvious answer is a bonus, of course. There are two types of bonuses you’ll usually be negotiating for. Firstly, many companies offer an annual cash bonus on top of your base salary, generally contingent on certain revenue or performance goals being met. These bonuses are often expressed in offers as a percentage of your total base salary.

If you’re applying for a senior role, you bring specific skills to the company, or the company is simply looking to attract exceptional candidates, you may also be able to negotiate for a signing bonus. Signing bonuses can be 5% to 10% of base salary for mid level positions.

While it may seem counterproductive to already be thinking about the worst-case scenario, you should also ask to see a company’s severance policy. Job security can help people perform even better at their jobs, so knowing that you’d be well protected if the worst should happen and you’re laid off benefits you as well as the company.

Personal Time Benefits It’s just as important to make sure you can enjoy your time away from work as you enjoy your time in work; and this is another benefit you can negotiate for once you receive an offer.

When we talk about time away from work, the first thing you probably think about is vacation time. It’s becoming more and more common for companies to offer “unlimited” vacation time. Of course, this comes with its own pros and cons. Unlimited vacation policies usually set a standard number of days employees are able to take off, no questions asked. After an employee surpasses that amount of vacation days, any additional vacation days will be “earned back” each month at work. This means that, if you leave the company with “unearned” vacation days, that vacation pay will be taken out of your final paycheck. If you’re being offered a job with unlimited vacation time, be sure to read the policy very carefully and ask plenty of questions so that you understand what’s expected of you.

Personal days and sick leave can also be up for negotiation. Ask about the company’s specific policies regarding the differences between personal days and sick days – some companies have strict rules dividing the two, and others combine them.

Finally, flextime is a benefit more and more people are hoping to see in their job offers. Looking for a long weekend? Flextime allows you to work extra hours throughout the week, and then use those extra hours to take time away from work without using a vacation, personal, or sick day. Some industries have adopted flextime as standard – for example, “Summer Fridays” in certain industries allow employees to work an extra hour Monday through Thursday in order to enjoy half-days on Fridays.

Personal Development and Lifestyle Benefits

A good job should be trying to encourage you to stick around, and one of the best ways to retain staff is to support them throughout various stages of their personal and professional development. Benefits like tuition reimbursement for additional education, student loan repayment assistance for employees who’ve already finished with education, and reimbursement for things like gym memberships and phone plans.

Another important element of this type of benefit is parental leave. In areas such as the US where parental leave isn’t guaranteed, offering generous parental leave is an excellent way for employers to retain staff. If family planning is on your horizon, it might be wise to include parental leave in your initial negotiations. Down the line, some companies also offer child care reimbursements, and you might consider bringing this up in negotiations as well.

Questions to Ask When Negotiating Salary and Benefits

1. How did you calculate this offer?

2 How do you determine raises? 3. How often will my salary be up for review? How will I be evaluated at these points? 4. What is included in my total compensation package? 5. Besides base pay, what other benefits are included in this offer? 6. What other things, besides the base salary, are negotiable? 7. Will I get this offer in writing? 8. What does this position’s severance package contain? 9. How are high performers compensated in this position? 10. When do you need a firm answer from me?

How to Negotiate a Job Offer with a Counter Offer

While you’re applying for different jobs, you might have a dream scenario in your head from the beginning. Maybe there’s a particular perk you have in mind, or you know that you wouldn’t ever have to worry about money as long as you’re making past a certain mark. If you have a firm idea of the type of compensation you’re looking for, and an offer doesn’t quite line up with it, you can respond to a job offer with a counter offer.

This process looks very similar to the process of opening negotiations, except you’re required to be more straightforward and forthcoming with what you want.

Job Counter Offer Email Example

Final Thoughts

Few moments in your career are more exciting than finally receiving that long-awaited job offer. However, it’s easy to get swept up in the excitement and forget to think about your long term goals and how this next gig aligns with them. When you’re prepared for the offer and understand what you’re looking for, you can easily enter into a negotiation process and make sure that your next job is a perfect fit.