Setting salary expectations with cousin Izzy

So… you're looking for a job and you get a call from a recruiter. The conversation is going well and they'd like to move you into the technical interviews stage. Or maybe, you've already completed all the technical part and they want to prepare the job offer. And then they ask the dreaded question: What are your salary expectations? And you freeze. Or, at least - I freeze. I'm no good at this part… I think I know what I'm worth - but what if I have it all wrong? Or what if they can pay more than I expect? Or they can't afford what I'm asking for and they won't want to continue with the interview process?

Cousin Izzy

We have a family story about our savvy-salesperson cousin Izzy who (legend has it) used to offer the following sales advice: Imagine you're selling two birds in a cage. A buyer comes in to your shop and asks "how much?". 
You answer: "$50". 
If they blink, you sell for that price. If they don't - you say "for the cage". 
They ask: "How much for the birds?", you answer: "$20". 
If they blink - sell for that price. If they don't - say "each".

Note: It's quite possible none of this story is true, but that's how I heard it and now it's mine to tell as I please.

How does this translate into salary expectations?

First, I do my research. I know how much I make now and how much of an upgrade I expect. I ask friends and use my network, check salary surveys, ask in suitable forums etc. Once I understand what the expected salary range for me should be, I want to maximize how much I can get within that range. That's where cousin Izzy comes in.

Let's say I've determined I should be paid X. When I'm asked what my salary expectations are, I say: "I don't know what your compensation package includes, but I was thinking of X".
If they "blink", I stop there. If they don't blink - I continue saying: "base salary, of course. On top of that I expect there will be a signing bonus and equity".

I use their reactions as a signal if I can ask for more at this point or not. From my experience, salary ranges can vary extensively between different companies and I've had times when I say X and they'll blink metaphorically by saying something like "we can probably get to that with equity and other benefits". If they react along those lines - I know there's not much point asking for more at this stage, while other recruiters will ask "base salary?" which tells me I can push for more.

After you've anchored your salary expectations and the highest place you can, you can and should negotiate the offer you get, but that's out of scope and there are many other excellent articles on the matter.

Frequently asked questions

Isn't that greedy?

But what if they rescind the offer?

Decent places won't do that. They'll tell you what they can pay and try to reach agreement. However, not all places are decent and even of the decent ones - they may think it's not worth anyone's time to continue the process if the expectations are way off. This can happen. I'm not saying this is not a risk. In fact, it happened to me the last two times I was looking for a job. I was (and am) privileged to have been working while looking for a job - so this didn't worry me much. If they didn't want to pay what I was asking, that was fine. I didn't have to work for them. If you're in that position - that's the attitude you should take.

However, other folk are not in this position - whether it's their first job or because they're acutely suffering at their current job. And I totally get that. In that case you can just aim at getting an offer. Don't try to maximize anything. If you can get two offers - that's usually a good time to try to negotiate (this is always true). If not, take the offer you got - but don't get too comfortable, after a year or so, try looking around to see what you're worth, maybe you're being underpaid and you should ask for a raise. Maybe you can look for another job from a better starting point.

Another option, if you can afford it, is to try maximizing the offer anyway. If they rescind, you can try again at another company. And again at another. It's unlikely all of them will rescind, and if they do - that may be a sign you are asking for too much. In that case you should lower your expectations. You can even go back to some of those other companies and say "Hey! I really liked your product/culture/whatever, can we try again?". They might say yes.

Shouldn't you try and make them tell you what the salary range is?

Yes, you absolutely should. But quite often, they will not share this information. And, as I said before, it's not a level playing field - it's good to have some tools in your toolbox for the case where you don't have this information and can't get it.

Thanks for reading this far! I hope it was helpful. And if it wasn't - well, at least remember to blink if you ever happen to want to buy a pair of birds.