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304 North Cardinal St.
Dorchester Center, MA 02124
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Every worker wants to be compensated fairly, especially in times of persistent inflation, high grocery bills, and steep interest rates. If your current paycheck isn’t cutting it, you might be wondering whether to ask for a raise or start looking for a new job. This decision isn’t simple and involves many factors, from benefits to job satisfaction and career growth potential. Here, we explore the key considerations to help you decide between asking for a raise and changing jobs.
As you weigh whether to stay put and ask for a raise or search for a new job, ponder these questions:
Most employers increase pay by 3% to 5% annually, but you might gain a more generous raise with a promotion or if you request one and are a top performer. However, many employers limit salary increases, so workers often find higher pay by switching to a different company where their pay starts off higher. According to a 2023 Bank of America report, job-switching could mean around 13% higher pay, although this figure has fluctuated due to market conditions.
A job is about more than just money. Consider other impacts of staying versus going, such as benefits, room for growth, job satisfaction, work-life balance, and purpose. Weigh all aspects of work and have a gut check on whether more money alone is worth staying or going.
If you feel undervalued but are unsure a raise is possible, prepare to negotiate other benefits or perks. Consider trying to negotiate:
There can be many compelling reasons to stay at your current company and advocate for a raise rather than leaving. Here are a few situations when that could be wise:
There’s a lot to be said for getting fulfillment from your job, whether you enjoy your day-to-day work, company culture, or your coworkers. If you’re content in areas besides your salary, it could be worth staying and asking for a raise.
If you’ve just wrapped up a major project or your company exceeded profit goals in part due to your work, your contributions and value are undeniable. You can seize these moments as opportunities to lobby for a raise.
Perhaps your pay could be better, but you have access to many valuable employee benefits, like student loan repayment assistance, life insurance, retirement account matching, health savings accounts, employee assistance programs, and subsidized gym memberships. These money-saving perks may make your job worth keeping, especially if you can also negotiate higher pay.
On the other hand, there are times when it may be better to look elsewhere, including when:
Just as it’s hard to leave a job with excellent benefits, it may be easier to ditch one without them. If you don’t have the essentials, like health insurance, or valuable perks, changing jobs could net you more money-saving benefits plus better pay.
Negotiating for a raise may not be the answer if you’re unhappy at work beyond your paycheck. If you’re already unhappy with other aspects of your job, such as a long commute or toxic boss, or you want a career change, this could be an opportunity to find a better fit elsewhere.
Maybe you really like your job and workplace, but you’re told you won’t get more than a 3% raise each year. Or that the only way to earn a higher raise is to have a higher position, but none are open or you’re not a candidate. These could point you in the direction of leaving for another job with more room for growth—either in pay and/or in career advancement opportunities.
There is no one-size-fits-all answer to this question. It depends on your career goals, job satisfaction, and market conditions. However, switching jobs every few years can sometimes lead to higher pay and new opportunities.
It’s generally advisable to ask for a raise annually, especially if you’ve had significant achievements or your responsibilities have increased. However, timing and company culture also play a role in this decision.
While it varies by industry and market conditions, a typical salary increase when switching jobs can range from 10% to 20%. However, this figure can fluctuate based on economic factors and individual circumstances.
There can also be a middle option. Some employers are more open to negotiating a raise when countering an offer from another employer. If you’re considering leaving due to pay and you land a job offer elsewhere at your desired salary, would you entertain staying with a raise? If so, reveal the job offer to your workplace and ask if they’ll negotiate your pay to keep you. Even if they can’t match the offer, you might nab a higher raise than you would without this leverage.
Regardless of the statistics or norms, this is a personal decision about what’s best for you and your loved ones. If you’re struggling to pay your bills, getting higher wages may be your sole objective. But if you have more wiggle room, you might consider all the other aspects of your compensation package and work-life balance. If you’re not able to get more pay through staying or leaving for now, it’s important to focus on living within your means until you can score a raise. Depending on your situation, that could mean getting on a budget, consolidating your debt, or picking up a side hustle.
At O1ne Mortgage, we understand the importance of financial stability and growth. If you’re considering a mortgage or need advice on your financial journey, don’t hesitate to call us at 213-732-3074. Our team of experts is here to help you navigate your mortgage needs and achieve your financial goals.
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