Gain insights from an HR director on climbing the career ladder, negotiating salaries, and seizing better job opportunities.
We’ve heard your requests for more resources on career growth and salary negotiation. Today's podcast features Tracy Keogh, who shares essential strategies for enhancing your earning potential.
As Chief Human Resources Officer at HP, Tracy oversees global HR operations, employee communications, and social responsibility efforts. With prior experience as Senior Vice President of HR at Aon Hewitt, she’s been guiding female executives in negotiation for years. In this episode, she outlines key tactics, including crafting a term sheet, requesting off-cycle reviews, and steering clear of negotiating against yourself.
Many women hesitate to ask for higher salaries due to concerns about being perceived negatively. Tracy encourages breaking this mindset, asserting that the classic advice of “you don’t get what you don’t ask for” holds true in salary negotiations.
Preparation is vital before entering any negotiation. Research industry standards by browsing online, consulting headhunters, or discussing with trusted friends and colleagues.
Next, create a comprehensive term sheet detailing your job responsibilities, current salary, expected salary, job title, bonus expectations, vacation days, retirement plan, and what you’d need to consider a new job offer. This thorough list helps clarify your total compensation value, according to Tracy.
Tracy notes that many women inadvertently negotiate against themselves. To avoid this, refrain from being the first to mention your desired salary and do not disclose your current pay, as many states have made this inquiry illegal. Companies often leave room for negotiation in their offers, and if you feel undervalued, it might not be the right fit for you.
She emphasizes the importance of negotiating from the start. For instance, she highlighted her own experience of earning more by declaring herself the primary income earner for her family.
Tracy also advises securing agreements in writing. If your manager departs, a new one might not honor verbal agreements, so having everything documented ensures you retain your benefits.
In the Mailbag segment, Jean offers advice on finding the best investment returns and maintaining a diversified portfolio. She also addresses a listener's concern about potential credit damage from periodic credit line increases and gives tips to another listener on engaging her husband in personal finance discussions. Lastly, in Thrive, Jean emphasizes the necessity of taking breaks at work, even if it’s just a moment of calm in the restroom.
Transcript
Jean Chatzky: This episode is sponsored by Fidelity Investments. Our goal is to empower you to confidently invest your money. Discover the essentials without the jargon at fidelity.com/demand more. Welcome to the podcast! It’s Jean Chatzky, and I’ve heard your feedback. Many of you enjoy episodes focused on career advancement, salary negotiations, and improving your benefits package. I’ve been eagerly anticipating this discussion, especially after an event at HP where Tracy Keogh shared her insights on women and investing, which sparked my interest in having her as a guest. Tracy trains women on her team to negotiate effectively, a skill she honed during her MBA. Tracy, welcome to the show!
Tracy Keogh: Thank you, Jean. I’m thrilled to be here.
Jean Chatzky: Your career journey is impressive. Could you share more about your background?
Tracy Keogh: I have a unique path, starting as a hospital administrator, then moving into management consulting after earning my MBA from Harvard. Eventually, I shifted to HR, where I discovered my passion for people management.
Jean Chatzky: Your negotiating prowess is evident, having consistently secured better pay for yourself. Yet many women struggle with this. Studies show that effective negotiation can yield salary increases of 7-8%. Over time, this can significantly impact financial security.
Tracy Keogh: Yes! Even small increases compound over a career. I took a negotiation course at Harvard, which proved invaluable. I remember using a term sheet to negotiate my first salary, which shocked my employer at the time.
Tracy Keogh: There are many tools women can utilize to negotiate confidently. Often, they feel asking for more is impolite, but there are effective ways to ensure fair compensation.
Jean Chatzky: Let’s outline some negotiation basics. What exactly is a term sheet?
Tracy Keogh: A term sheet includes all relevant job details, such as current salary, anticipated increases, bonus percentages, equity options, and vacation days. It’s essential to document everything to understand your total compensation.
Jean Chatzky: So it’s about creating a detailed inventory of your current and future compensation and benefits, along with safeguards for job security.
Tracy Keogh: Exactly! And don’t forget company-specific perks, sign-on bonuses, and severance guarantees. Writing everything down clarifies your worth and helps prevent leaving anything on the table.
Jean Chatzky: How does industry impact negotiations?
Tracy Keogh: While there are industry variations, core elements like salary, bonuses, and equity remain consistent across sectors. Researching your industry is crucial, and don’t hesitate to ask what others expect.
Jean Chatzky: Women sometimes negotiate against themselves. Can you elaborate?
Tracy Keogh: Don’t be the first to state your salary expectations. In many states, it’s illegal for employers to ask about previous salaries, which can affect pay equity. Always prompt them to disclose their offer first.
Jean Chatzky: What if the offer is below your expectations?
Tracy Keogh: If a company undervalues you, that’s a red flag. Remember, initial offers often leave room for negotiation. If you’re low-balled, consider other compensation avenues like bonuses or equity packages.
Jean Chatzky: Let’s discuss the importance of negotiating from the outset.
Tracy Keogh: It’s crucial to set the tone early. During the interview phase, focus on your skills and value rather than salary. Subtly indicate your financial needs to frame future offers.
Jean Chatzky: We’ve covered term sheets and negotiation groundwork. What else is essential for sealing the deal?
Tracy Keogh: If you’re at a high level, have a lawyer review your employment contract to protect your interests. Ensure clarity on reporting structures and severance terms. Always get agreements in writing.
Jean Chatzky: This advice applies across all experience levels. For many, staying with a company can be beneficial for retirement and healthcare perks.
Tracy Keogh: Absolutely! Long-term employment can yield significant benefits, including promotions and better retirement packages. Be proactive in negotiating during promotion cycles.
Jean Chatzky: Having advocates within your organization can also help. How can one find those sponsors?
Tracy Keogh: Seek sponsors who will advocate for you within the organization, especially during promotion discussions. At HP, we have a program supporting women and underrepresented minorities, resulting in significant promotions.
Tracy Keogh: Don’t hesitate to express your ambitions. Let others know you aspire to leadership roles; it can open doors for opportunities.
Jean Chatzky: To wrap up, many avoid salary discussions. Where do you stand on this?
Tracy Keogh: Conversations around salary are becoming more common. Transparency is key, and even informal discussions can reveal valuable insights about compensation.
Jean Chatzky: Thanks, Tracy, for sharing these valuable negotiation strategies.
Tracy Keogh: Thank you, Jean. Good luck to everyone.
Jean Chatzky: We’ll be back with Kathryn and your mailbag. Kathryn Tuggle is here with me. Tracy's term sheet advice was enlightening, but it also felt overwhelming given the numerous elements involved.
Kathryn Tuggle: It’s easy to focus solely on salary when considering job value, but we must also examine benefits, future raises, and job security.
Jean Chatzky: Absolutely! Expecting severance as part of a job offer is smart, especially if you may need to pivot in the future.
Kathryn Tuggle: Many people equate severance with unused vacation time, but it’s essential to consider broader implications.
Jean Chatzky: Negotiating for a complete package is crucial for financial security.
Kathryn Tuggle: Yes, and knowing you can refer to notes during discussions can build confidence.
Jean Chatzky: And it’s perfectly acceptable to have notes during meetings or discussions.
Kathryn Tuggle: So true! What letters do we have today?
Kathryn Tuggle: Our first letter is from Sharon, who asks about achieving a 6.5% return on investments. Is this realistic?
Jean Chatzky: This is a common question. Historically, the Dow Jones and S&P 500 yield 8-10% returns. To achieve these, focus on a diversified portfolio with a healthy mix of stocks.
Kathryn Tuggle: The next letter is from Katie, who wonders about her American Express credit line increases and potential future impacts.
Jean Chatzky: Katie, maintaining a credit utilization ratio of 10-30% is crucial for a good credit score. Allowing increases is fine as long as you stay within that range.
Kathryn Tuggle: Cherry writes about financial fluency disparities with her spouse. How can she align their goals?
Jean Chatzky: Encourage conversations about shared life goals before diving into financial specifics. A financial advisor or therapist may also provide guidance.
Kathryn Tuggle: Are there group therapy options for couples dealing with finances?
Jean Chatzky: While not common, courses like Financial Peace University can help couples align financially and build a shared understanding.
Kathryn Tuggle: Great suggestion! Many couples face similar challenges.
Jean Chatzky: Absolutely! If you want to reach out, email info@savinghunt.com.
Kathryn Tuggle: In today’s Thrive, where do you find privacy in an open office? Many resort to the restroom for a quick break, and that's perfectly normal.
Kathryn Tuggle: Companies are adapting by adding single-stall, gender-neutral restrooms for privacy, but be mindful of automatic flushes!
Jean Chatzky: Thank you for joining us today! We appreciate Tracy Keogh’s valuable insights on negotiation. Subscribe for our next episode featuring Kathryn Gilbert, discussing love and loss.
Thanks for listening, and we’ll talk soon.
