Does Inflation Have You Second Guessing Your Salary?

Inflation is a big issue at the moment, and it just keeps getting bigger (pun very much intended). In fact, many professionals are realizing that they aren’t getting a raise this year, and the ones who are might not even get enough to cover standard cost-of-living increases.

According to an article in Forbes, “Among those who received raises [in the past year], two-thirds received an increase of just 1% to 5% of their salary, well below the current rate of inflation.” Even though the job market is wide open, the inflation rate is over 8% which means workers still don’t have the bargaining power they need to negotiate a pay increase that will cover costs.

So what are we to do? Just sit around and wait for the next yearly raise? Do we hope that things start to balance out and our purchasing power becomes a little more, well, powerful? Or is this the sign we’ve been waiting for to switch careers or go back to school? A lot of people are feeling like they’re at a crossroads right now and I totally get that.

It’s Time to Make a Change

If you started your job three to seven years ago, your starting salary may have been great. But since then, you probably haven’t seen the yearly wage increases you expected. To be fair, we have been through a lot of uncertainty in the last few years… but that doesn’t mean you can’t get what you rightfully deserve for all your hard work. Here are three options I recommend if you’re looking to increase your salary without leaving your current role:

Create More Impact

Instead of leaving your role and starting from scratch, what if you see this as an opportunity to create more impact in a role you already enjoy? Ask your supervisor if there are any projects or tasks you can assist with or be proactive and put together a proposal to present to your boss. 

Be VERY strategic, though. The whole point of creating more impact is to leverage it into a higher salary when the time comes. So, think in terms of numbers before you agree to anything. You need to be able to show how you contributed to the organization in a way that is meaningful for them (e.g. profits earned, time saved) so you can justify asking for that pay increase.

Negotiate a Performance-Based Pay Increase

If you feel you’ve already done enough to prove your impact to the organization, it’s time to think about negotiating a performance-based pay increase. This is scary for a lot of people, but really you just need to position the qualifications, experience, drive, and skills you already have.

Come up with data-driven talking points such as, “In the last 4 months, I reduced payroll errors by 20% which saved the company $22,000.” Being able to show the economic impact of your work will make it much easier to get a “yes” when you ask for that pay increase.

Make Your Money Work for You

What if you learned how to build more wealth with your current salary so you could make it go farther? Wealth-building isn’t just for the one-percenters. Everyone can learn how to invest their money or budget to make their money work harder for them, even during difficult financial times.

Start by looking at how your money is being spent. Write down your expenses for the last month. Is there anything that can be cut, even temporarily? If so, put that money into an account that you do not touch. Or better yet, talk to your HR representative about increasing your pre-tax retirement contributions — trust me, you won’t even notice the money coming off your paycheck — and if you can, make sure you’re maxing out the company match (if there is one).

As you can see, leaving your role isn’t always the answer. But, if you do decide to make the leap to a new role, you will want to make sure you negotiate at least a 20% pay increase to make the switch worthwhile. 

A Coach Can Help You Move Forward

As a career coach, I know that getting outside help really helps a lot of people in this situation. I talk to people every week who feel stressed because they’re living paycheck to paycheck, even though they’re working so hard and contributing so much to the organization they work for. 

They want freedom. They want to create an emergency savings account. They want to be able to take a vacation and feel like they’re thriving when it comes to their finances instead of striving.
If this sounds like you, I encourage you to consider joining my CCA coaching program! I take on five individuals per month for this program, and I would love to get you on the path to more money and more impact in your career. Click here to learn more!