Her Million Dollar Mistake
Written by Kelley Keehn
Tuesday, September 12th, 2017
Did you know that one simple error, a minor misstep at the start of a woman's career, can result in her leaving over a million dollars on the table during her working lifetime? And that's not factoring in compound interest.
You may be surprised that it's just about speaking up and asking for more. The authors of Women Don't Ask say on average only 7% of female business grads coming out of school today negotiate their starting salary. But 57% of men―nearly eight times as many―ask for more money.
A number of books, including The Confidence Code and Lean In, refer to an interesting internal report by Hewlett-Packard showing that men applied for jobs when they felt they'd met 60% of the criteria, whereas women needed to feel 100% qualified before applying.
According to the Women Don't Ask website:
- In surveys, 2.5 times more women than men said they feel "a great deal of apprehension" about negotiating
- Men initiate negotiations about four times as often as women
- When asked to pick metaphors for the process of negotiating, men picked "winning a ballgame" and a "wrestling match," while women picked "going to the dentist"
- Women will pay as much as $1,353 to avoid negotiating the price of a car
Joy Thomas, CEO of CPA Canada, says negotiating "can make people uncomfortable, but it seems like more women than men suffer from this."
Thomas recommends that women can create more ease around asking for the compensation they want by thinking of a strategy in advance.
"Write your speaking notes ahead of time. Think about how you're going to raise the question of asking for more and how you're going to respond if they come back with something negative. Walking yourself through this can give you a higher degree of comfort. That will help you deal with the lack of confidence, or the lack of willingness, to negotiate," she says.
Dr. Moira Somers, a psychologist who specializes in money issues, warns: "Our starting salary becomes a kind of psychological anchor, like the home button that we return to when we think about what we're going to ask for in subsequent jobs. Where you start really determines where you'll finish. So, it's important to learn how to negotiate."
Dr. Somers echoes Thomas' suggestion to practice in advance with a coach, financial professional, friend or even yourself. She was recently interviewed by the Financial Planning Standards Council for a video on the subject – check it out here.
Thomas points out that women often get hired based on their accomplishments while men often get hired based on their potential. Even she, when interviewing for CEO positions, "fought that a lot. I made sure I was prepared in terms of me, not in my current role, but talking as me the future CEO. As the CEO I would do XYZ, or when I become the CEO, I will do this."
You Never Know Unless You Ask
Do your research, value your worth, practice your ask and be prepared for no. But also, be pleasantly surprised for the possibility of a "yes," and not just in monetary terms either. Do you need an assistant, more help, vacation time, flex hours, a corner office or a better title? You'll never know until you ask!