PF Focus: Offer Negotiation - Why Salary Isn't Everything

My last first semester of my undergraduate degree is coming to a close. With that, my schools career week has also come to pass. After the Supply Chain Management specific career fair I was invited to interview with a few fantastic companies including Dell and Exxon Mobile! I felt that those interviews went very well, though unfortunately I am no longer being recruited by Dell. Since then I have also been invited to interview at Lockheed Martin and General Dynamics! In other news, my lovely girl friend was recently extended two medical school interviews! It has been an extremely long and trying process for her and I can't wait to see where her path leads. The future is looking very bright in terms of my career and our future, for that I am truly excited.

All of these thoughts of interviews, jobs and life after college really got me thinking. Of all the things you leave college with, a degree (hopefully), friends, and new experiences, the most important and vital to your success is a job.

The Income Jump

Getting a job is what college is all about. You can learn all you want but if you can't put your new found knowledge to work in some way Ill say it was all for not. If you are a business student like myself then you know how important leaving school WITH a job is. I would be willing to argue that the months immediately following your graduation is when you are the most valuable. Most graduates have never seen the amount of money they will be offered per year at their first job, and companies know this. As a college student it is very easy to get excited about $40,000, $50,000 or $60,000+ per year, especially when so many have student debt. These are income levels many older adults I know have, and because of this many students don't think to negotiate or think they shouldn't. But thats what the company wants you to think and thats exactly why you MUST negotiate.

The Offer

You just got out of class and you are headed back home to eat lunch (because you spend meaningful money and don't eat out that often). Your phone rings and it's the HR person you talked to from (company you have applied to). He or she will ask you how you have been and then talk about how impressed they were with your profile after the interview. They have decided to offer you the position! Your heart is racing and all you can think about is how nice it will be to have a real job! The HR rep will describe the offer going over most of the benefits and a few key points and at the end he or she will ask something along the lines of "What do you think?". THIS IS IT. This is where so many people get it wrong. If you hear the offer from the HR representative and you say "Sounds great, when do I start..." you have just lost all negotiation power as you have implicitly accepted the offer. If you hear the offer from the HR representative and you say "Sounds great, but I really think a salary of $65,000 instead of $60,000 would make it easier for me to accept the offer." you have also lost. Now the HR rep knows that all it will take to get you is an extra $5,000. Which for you might be all you want, buy you have just left thousands and thousands of dollars on the table. 

Negotiate Everything

Maybe you think that salary is the only thing you should negotiate, or maybe you think salary is the most important thing you should negotiate. Well you would be wrong on both accounts. Aside from salary things you should and can negotiate are; a signing bonus, time off (sick days, Paid time off, and vacation time), relocation and moving expenses, flexible work hours/location, Health care, tuition reimbursement or professional development, stock options, Company phone, car, computer and more. Many of the things you can negotiate might not add a lot of money but many add a lot of value. Getting more vacation time won't get you paid, but it will allow you have a better work life balance. Consider the intangibles as they are often times just as valuable as the tangibles when starting your young career. The best part about all of this is you hold all the cards. The company has offered you, they want you and now it is your turn to see how much badly. You need to negotiate because they expected but also because you are worth it.

Conclusion

I know this article doesn't have much to do with dividend investing but it does have a lot to do with investing in yourself. Learning how to negotiate is an immeasurably valuable skill to have and will pay dividends in it's own right. 

This article was more personal finance based and I think it is valuable to discuss personal finance topics. Its never to early and never to late to learn more about personal finance and I think I will be adding a PF focused article in once or twice a month. As always if you have read this far please make sure to let me know what you think in the comment section. If you really enjoy my content make sure you stay up to date with me on twitter and Facebook!

Whats you favorite factor to negotiate when considering job offers?

I am a 22 year old kid who seeks to create a life of financial independence via passive income. The accumulation and growth of quality dividend yielding stocks will be the main source of income and this is my journey.

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