I got a 16.6% raise yesterday. That would make yesterday a very good day on any personal finance blogger's scale. Since I joined my company slightly more than two years ago, my salary has increased by 55%. That's pretty impressive, but this large percentage increase is mostly because I was grossly under-paid when I first joined my company. If the information I have been gathering is correct, I am still about 15% below the market rate for my title, responsibilities and experience. I hope to erase this gap within the next year. How about that for an ambitious goal?
You may be wondering why I took a lower paying job to begin with. You readers always ask such great questions. I took the job because it allowed me to switch to a new industry which I really wanted to break into. In addition, my company is a major player in its field, and by taking my position I was able to join this company in a very influential role. Bottom line, I thought it was a good long term career move.
When negotiating my offer, I made a conscious decision not to negotiate my compensation and instead very aggressively bargained for my title and responsibilities. I gambled that this would pay off later down the line. This gamble seems to have worked, and if I play my cards right my title and position in this specific company could be highly marketable when hunting for my next job at some point in the future. I was also gambling that I would be able improve my pay in relatively short order. Well, it has taken me over two years to achieve this pay increase, but I think that I have made the right decision.
Before I end this post there is one more lesson that I would like to share. This lesson is all about how to avoid snatching defeat from the jaws of victory:
This salary increase has been in the works for a couple of months now. My boss has previously hinted at this, asked me what I thought my fair compensation level should be and even told me that I would be getting a raise. However, she did not tell me when the raise would come through, nor did she tell me the exact magnitude of this raise. Well, like any red blooded human, curiosity got the better of me and I tried to find out more information about this impending raise. To do so, I consulted with our VP of Finance. A few days ago he told me that my raise was approved and that I would be receiving 100% of what I had asked for.
It turns out that he had the wrong information. My actual raise was lower than what I had asked for. Since my company did not give me formal notice of my raise and its magnitude, I found out the specifics only when I opened my pay-check yesterday. Even after opening the pay-check I had to manually calculate my new salary based on my pay stub. And here is the punchline: I was actually disappointed that I got a 16.6% raise. What should have been a big happy moment for my relationship with my company turned out to be a little disappointing, because the company did not set my expectations in advance and because I obtained some erroneous information from a source that turned out to be unreliable.
The lesson of the day is this: if you are going to give someone a raise, set their expectations in advance. Surprises are highly over-rated, especially when they... don't come as a surprise. I think that this is a life lesson that goes well beyond salaries and personal finance.