Personal Finance

New grads: How to get higher pay and not blow it for the future

Key Points
  • There's one nerve-wracking, yet vital part of the on-boarding process recent grads need to master: negotiating salary and benefits.
  • 43 percent of workers are still asked about salary history during job interviews.
  • Future employers may base their proposed pay on a candidate's previous salary level.
Timothy A. Clary | AFP | GettyImages

Many college graduates are likely to land job offers in the weeks following their commencement.

Though they may be ready to launch themselves into their futures, there's one nerve-wracking, yet vital, part of the process new grads need to master: negotiating salary and benefits.

Bargaining with a prospective employer can be daunting for someone in their first full-time position, yet getting the right salary from the start can help ensure that future employers don't lowball their compensation.

Here's what the average American woman makes
Here's what the average American woman makes

That's because future employers may base their pay offer on a candidate's previous salary. In fact, 43 percent of workers are still asked about salary history during job interviews, according to compensation research firm Payscale.

Requesting a higher salary for a new job can be a lot of pressure, according to Daniel Orozco, the director of Southwestern University's Center for Career & Professional Development, but it's appropriate to do, as long as it's handled the right way.

Do your research

Paul Wolfe, the senior vice president of Human Resources at Indeed, a job-seeking website, said that research is the first thing a new hire should do when negotiating pay.

Wolfe said a job seeker needs to know what he or she is worth. You can search online what a position usually pays, factoring in your education and experience.

Then, set a minimum salary you are willing to accept based on those multiple sources.

However, Orozco said you don't need to negotiate a higher salary if research shows you're being offered the appropriate amount of money.

Don't drop names or give ultimatums

Orozco said if candidates are aware of another employee's salaries at the company, they should never use that employee's name when negotiating.

"That's the kiss of death," Orozco said. It can also lead to trouble for the employee, he added.

He said that making demands or giving ultimatums can come across negatively during the negotiating process.

Negotiate more than salary

"Salary clearly is the most important part of compensation, but there are other benefits, as well," Wolfe said.

Those may include bonuses, long-term incentives such as equity (in a start-up, for example), medical and dental insurance, and paid time off.

Wolfe said it is important for job seekers to negotiate what is most important to them. So, if a new-hire knows that he or she is getting married soon and will be going on a honeymoon, it may be better to negotiate more vacation time.

Be prepared to be told 'no'

Even after all of your research, an employer may still deny your request. Wolfe said this is part of the process.

"If you don't get the salary you want, you need to be honest with yourself and do some soul-searching," Wolfe said.

Wolfe said it is also important to keep in mind the periods when employers review salaries to give out raises and bonuses. If you do a good job, you may be able to earn a raise later on.

More from Personal Finance:
If you're hunting for a job, expect to do this for free
Here's what you need to qualify for public service loan forgiveness
Few people know about this key college savings plan

WATCH: Tips for how to negotiate your salary

Salary negotiation
Salary negotiation