Its time - Need your help with salary negotiation (interviewed, job, interest)

[jribe]

Originally Posted by wildviper

Thanks again. I will take the advice here and think.

Just other info (and I do not expect further replies) as FYI:

I am fully licensed, have been in this biz for 16+ years. Last raise (or lowered) was in 2015. And I understand that I am not irreplaceable...but in this particular practice, it would be a substantial hit to him for a period of 6 months if not a year at least.

Also, I know in another practice (60+ miles away from me), they pay $75K to $85K to positions that are lower than mine and do just analysis work. Their practice is larger than ours though.

Once again, thank you all for your help. I will think and post here what I do next.

and you consider "fully licensed" to be what? a series 7 and 66? Laughable.

Seriously, take yourself down a notch and be grateful for what you have - period. You have said nothing that makes me think you would be more valuable to this FA than anyone else with a few years experience (except they would take way less salary). Count your blessings that this guy is giving you a good gig- otherwise leave and see if the "grass is greener".

[wildviper]

Originally Posted by jribe

and you consider "fully licensed" to be what? a series 7 and 66? Laughable.

Seriously, take yourself down a notch and be grateful for what you have - period. You have said nothing that makes me think you would be more valuable to this FA than anyone else with a few years experience (except they would take way less salary). Count your blessings that this guy is giving you a good gig- otherwise leave and see if the "grass is greener".

You know its interesting. Are you a adviser or a small business owner in this field? You seem to make a judgement of my skills without considering the things I have already said.

So you are telling me that a majority of folks in this industry are consistently doing these things below, week in week out:

• Identify acquisition opportunities for the boss and analyze it to see where revenue will come from
• Besides managing the day to day, do millions of dollars of trades every week
• Handle irate clients / help mitigate complaints
• keep the biz running while boss is out chilling at home
• prepare marketing plans and put them to work
• review and sometimes run financial plan analysis
• provide strategies for client's goals from protection planning to estate planning to education planning to retirement planning including running pension analysis
• help and fix technology issues including programming extensively in Excel via VBA
• construct multiple investment portfolios and run full analysis
• project planning, implementation and consequently run reports on how the project fared
• be a compliance person
• I can go on and on....

So you are saying there are numerous people doing this in our industry huh? I can understand if you mean that they are doing some of these things every now and then...I would challenge you to find me someone that does this all at the same time and not be an owner or highly paid or an idiot like me.

[goodlife36]

Originally Posted by wildviper

Thanks everyone for your input. This is helping provide me clarity. After reading everyone's take, I still feel that I should be higher and am underpaid. And, I do not really want to be partner.

The option of doing less work (only what a practice manager does, for example) is not really feasible anymore. I have already shown my cards and played them for past 6 years. I think if I were to stop doing the other work, it would not go down well.

While I understand that everyone feels a 50%(averaging 8% per year) increase in my salary from 6 years ago is great, the underlying theme has been that I have been underpaid from the get-go. So I was in a tough financial situation and was glad to have found a job and thus accepted the first offer. It was below market value at that time since I made $75K prior to that doing 50% of the work I did then. Yes, I know, I should have negotiated at that time..it is my mistake. I have made many and now I want to rectify those (thus this thread).

Two years ago, my salary was actually $95-$96K and went down in 2015 and 2016 cause he restructured the bonus structure. When I asked him about why the decrease, he said well the business had suffered (sort of true). Previously the bonus was never known to me of what it would be...just randomly he would dole that out at end of year. Very stressful not knowing what you are going to be making. So if I were to just inflate the $95K from two years ago, I should be at $100K just purely as COLA of 3%.

The decrease in my income has left a bitter taste in my mouth, as it rightly would to anyone. The business suffering was actually entirely due to him. He has become comfortable knowing I am here taking care of his business. He doesn't even show up to work until 10am or 11am...keeps saying he works from home. All the staff know that is not true either. He went through a personal situation 3 years ago and his work ethics have just gone down. The business suffers cause he doesn't call back the client that we constantly remind him to do. There are multiple factors such as those...I keep saving him with clients and it is just getting way too stressful. As I mentioned, my doctors have officially said that my health will continue to suffer if I keep up with the stress.

I feel that if I was paid what I feel I deserve, that would go a long way to reducing the stress since that would be commensurate with what I do for him actually. And to someone that said if I close deals...I did bring him that business where he increased his assets by 20% and thus income similarly.

Other factors that play are: he texts me off-work hours and expect me to reply and call him. I do generally though I have tried to reign this in. I am constantly looking for ways to grow the practice and provide him with my findings and strategy on how to achieve that. I do that without being asked...just my nature to figure out sources of future revenue and growth as well as to efficiently handle that.

Now...after saying all that, would you all still feel that I should sit tight and not ask for the raise?

Maybe you are in the wrong position. Why don't you look for a senior management position? If you have all of this valuable experience, why would you take a pay cut if you went somewhere else?

[eastcoastguyz]

Originally Posted by SmartMoney

There's a phenomenon I see of talented people working for very successful people - they start overvaluing their worth and start thinking they are the reason for their employer's success. It may have merit, but rarely are they irreplaceable.

Be very careful, here. You are about to become very dissatisfied with a well paying job where you have carved out your own niche. If you can't fix the thinking, you will quickly find out if the grass is greener, elsewhere.

Good post!

The only real method the OP can determine their market value is to apply for others jobs that have the desires salary and see what happens. Meaning, do you get any inquiries, do you get interviews and more importantly any offers. Then you have a real way to tell what the real situation is.

Employees have to be very careful about over estimating their importance to a company. If what you are doing truly produces measurable useful results, then this should be something that's discussed a head of time and make this part of your written goals and if the goals are met successfully, there would be actual compensation numbers spelled out. Because if the company isn't willing to do that for you before you do something great, then you should move on. Because at this point, they are likely going to think what you have been doing is just part of your normal job. And if you leave, they will replace you with someone else with the same expectations for those duties, because the OP has proven that job can get done for the current salary.

[Rynldsbr]

Interesting thread. I am not in your field and so cannot speak to the skills, licensing, and details, but we do have some similarities in the added responsibilities aspect. I was getting great raises and decent bonuses s an operations manager but the workload kept increasing until the 75 hour workweek was killing my family life and affecting my health. I finally explained that I would sacrifice a little bonus if they hired an entry level assistant to handle the workload with me. When it was declined, I went shopping for a new job. I was the first manager to ever leave the company willingly and they were shocked.


Identify what you are willing to do. "Market rate" is too subjective and too many variables in most cases. What are YOU willing to do and what is YOUR bottom line. Maybe the gig is better than you think, you just have an itch for more...maybe not. Maybe you are worth more and should look around, but be aware of what sacrifices you may need to make when you change.

[SportyandMisty]

Question: how many employees are at your firm? And how old is the owner? Does the owner have any relatives working in the business (children, in-laws, cousins?) Or life-long friends/partners? Does the owner have any financial partners to your knowledge?

I think at your level (~$100K), it is a massive mistake to think about COLA. COLA is for lower level employees. At your level you should never think about COLA. Instead you should think about ways to "break the mold" and expand business (as you did with finding another practice to acquire).


At any rate, I disagree with some of the advice given here.

*******

1. I think it would be a mistake to go out & find another offer & ask your boss to meet it. That boxes him in and bosses do not take well to that tactic. You have a fair bit of "loyalty equity" built up with the owner, and don't squander that.

HOWEVER, it is always good to know the market -- so go ahead & interview & get a few written offers so you know what the market is. Moreover, it is important to know the structure of the compensation package: base, bonus, profit sharing, fringe benefits, etc etc. But don't throw this in his face.

Let me give you a hypothetical to illustrate my point.

Let's say I have 2 employees who are otherwise identical. One keeps his head down, working, doing everything I ask and more with competence. The other one performs the same, but every now and then goes out and interviews for jobs to see what out there --- and makes a conscious decision to stay working for me. As a manager, I value the second one more (it may be a bit irrational, but that's me.)

2. Do you get written performance reviews? This is common in mid-sized and larger companies, but I've never worked in your industry or in a small business. If you don't get them, can you ask for one? After all, one way for you to add more value to the firm is to find out what you're doing right & do more of it, and where you are not exceeding your boss' expectations and fix it. Even if there is no way to get a written performance review, can you set an appointment with your boss to go to lunch and discuss your performance?

3. I think it is OK to make your boss a proposal. I think the best way is to invite him out to lunch so you sit down face to face & have a conversation. Here is a hypothetical approach at lunch:

"Boss, I want to have a conversation of possibilities. These are just all blue-sky hypotheticals that I'd like to discuss. Where do you want the business to be in another 5 years, and how do I fit in to that objective? If you had the very best employee in the world, what 3 things would he achieve during that time? etc etc etc" [insert discussion which is likely to go all over the place].

Finally, something like "I'd like to discuss a different compensation structure with you. What if we were to do something like a smaller base pay for me coupled with an incentive structure that would allow me to show you I can achieve those 3 most important goals with flying colors? And, of course, if I perform extraordinarily well, I of course make you a lot more money, and I earn a lot more than I currently earn through a bonus or profit sharing structure alongside you? That is, what if I take on more risk with the possibility of making a much higher income for myself if I perform?"

It is also OK to ask about your boss's exit plan. Does he plan to retire at some point? What if he plans to sell the business within the next 5 years so he can retire and go sit on the beach & drink cocktails with little umbrellas? If so, what does that mean for you? Or, does he plan to run the business until he croaks?

What do you think the business is worth if he were to sell it? Is there a way you could buy into it -- say, buy a 5% stake?

[tolovefromANFIELD]

Originally Posted by wildviper

You know its interesting. Are you a adviser or a small business owner in this field? You seem to make a judgement of my skills without considering the things I have already said.

So you are telling me that a majority of folks in this industry are consistently doing these things below, week in week out:

• Identify acquisition opportunities for the boss and analyze it to see where revenue will come from
• Besides managing the day to day, do millions of dollars of trades every week
• Handle irate clients / help mitigate complaints
• keep the biz running while boss is out chilling at home
• prepare marketing plans and put them to work
• review and sometimes run financial plan analysis
• provide strategies for client's goals from protection planning to estate planning to education planning to retirement planning including running pension analysis
• help and fix technology issues including programming extensively in Excel via VBA
• construct multiple investment portfolios and run full analysis
• project planning, implementation and consequently run reports on how the project fared
• be a compliance person
• I can go on and on....

So you are saying there are numerous people doing this in our industry huh? I can understand if you mean that they are doing some of these things every now and then...I would challenge you to find me someone that does this all at the same time and not be an owner or highly paid or an idiot like me.

So you "feel" you're worth more money? Why not and start your own practice and earn all the fees, and really get paid what you "feel" you're worth. What you're doing is playing with someone else's money. Monopoly money. Try doing it on your own, risking your own money.

This is the reality of many talented people. Those that truly think they can get paid more, go on and get paid more. They take the risk. It happens every single day. You want all the glory (money) without any of the guts (risk and gumption). It doesn't work that way.

[wildviper]

Originally Posted by SportyandMisty

Question: how many employees are at your firm? And how old is the owner? Does the owner have any relatives working in the business (children, in-laws, cousins?) Or life-long friends/partners? Does the owner have any financial partners to your knowledge?

I think at your level (~$100K), it is a massive mistake to think about COLA. COLA is for lower level employees. At your level you should never think about COLA. Instead you should think about ways to "break the mold" and expand business (as you did with finding another practice to acquire).

"Boss, I want to have a conversation of possibilities. These are just all blue-sky hypotheticals that I'd like to discuss. Where do you want the business to be in another 5 years, and how do I fit in to that objective? If you had the very best employee in the world, what 3 things would he achieve during that time? etc etc etc" [insert discussion which is likely to go all over the place].

Finally, something like "I'd like to discuss a different compensation structure with you. What if we were to do something like a smaller base pay for me coupled with an incentive structure that would allow me to show you I can achieve those 3 most important goals with flying colors? And, of course, if I perform extraordinarily well, I of course make you a lot more money, and I earn a lot more than I currently earn through a bonus or profit sharing structure alongside you? That is, what if I take on more risk with the possibility of making a much higher income for myself if I perform?"

It is also OK to ask about your boss's exit plan. Does he plan to retire at some point? What if he plans to sell the business within the next 5 years so he can retire and go sit on the beach & drink cocktails with little umbrellas? If so, what does that mean for you? Or, does he plan to run the business until he croaks?

What do you think the business is worth if he were to sell it? Is there a way you could buy into it -- say, buy a 5% stake?

Thanks. The business is small. We have 3 staff(including me) and the boss. He is not going to retire anytime soon. It will be at least 20 years. There has never been a formal review process or any of that sort. Until recently, the bonuses were just pulled out of thin air by boss and given. Starting in 2016, a more solidified salary was put in place and bonuses were substantially reduced. I am fine with that structure and that is what I was always asking him for.

There are a couple of streaks and underlying theme in him that I know would lead him to oppose any level of stake. He is selfish. I have had numerous examples of this not just with me personally but other staff. For example, I was supposed to study for my CFA..that was a deal from originally 6 years ago. Well, he has never been supporting of that and practically has said that he would have to cut my pay drastically if I do that since it "can possibly" affect his work; though the plan was always for me to study on my time and not his. 6 years on, and I still have not pursued that. Another staff..in their early 20's wanted to start studying in University on a part-time basis - classes at night...he was NOT happy. He complained to me that if she is studying (albeit on her time), how is she going to affect my business. She was studying at her lunch hour and he came to me and told me to cut lunch hour into half hour for her.

Another colleague of ours got another job and my boss specifically told him NOT to tell me his new salary. He said he wouldn't want me to leave. That was two years ago.

Anyhow, I understand where he comes from(he has taken on risk) and I would like to say that I would be different in his shoes, but can't say that for sure. I know I would try and not be the same.

Ultimately, I am leaning towards having a conversation with him about future plans like you have suggested and see where that leads. That is what is my current thinking - let's see how the weekend changes my thinking as I think through all this more and more.

Originally Posted by tolovefromANFIELD

So you "feel" you're worth more money? Why not and start your own practice and earn all the fees, and really get paid what you "feel" you're worth. What you're doing is playing with someone else's money. Monopoly money. Try doing it on your own, risking your own money.

This is the reality of many talented people. Those that truly think they can get paid more, go on and get paid more. They take the risk. It happens every single day. You want all the glory (money) without any of the guts (risk and gumption). It doesn't work that way.

I feel worth more money cause what I have heard others being compensated in similar situations but doing a lot less work. Its very hard to equate perfectly and thus the "feel". For example, another operation manager was earning $120K+ seven to eight years ago with another boss. She was doing a lot less work than what I do..a lot less. The business, at the time, was similarly sized to what our biz is today.

I do not have a complex of I am the **** and whatever. If that was the case, I would have changed jobs 5 years ago and potentially keep changing as my ego would not be satisfied. So, now that is laid to rest...I have become more aware of my worth and requesting just that amount. i am not saying pay me $200K or $500K...I understand the risk that the boss has taken; at the same time, I have demonstrably helped him grow his practice.

I would love to do my own thing, but as mentioned before, starting from scratch is not something I can afford right now. If a business comes by to buy, I would jump on it. I know I can make it and am not afraid of sales - heck, I have been in sales in one form or another for my life.

Thank you all - in quite a few different ways, this has helped me clarify my position to myself.

[Nlambert]

There are just too many variables to correctly identify what you think you should make based on hearsay. You need to go get offers in hand and find out for yourself.


Did the manager making $120k have larger and more profitable accounts? Was this company more profitable overall than your small company? Did this company have a lower overhead, less expenses, etc? Is the compensation package similar (bonus structure, base pay structure, benefits, etc...)? Was she really doing less work, or was she more able to handle the added stress so it appeared that she did less?


Again, I feel like I should make a whole lot more than I do, but I know from job hunting and offer letters that my current title pays within 10% higher or lower than what I make now. Despite having over double the duties that others with my title have, in this line of work the title and labor category is how you get paid. Not the amount of work you take on.


Just something to think on.

[jman07]

I'm not sure if doing multiple jobs means your worth 120k. I think you need to look at the average pay for all the jobs you do and percent of time doing each and that is your value.

Your value could also be determined by how much money he would lose a year paying someone else a little less. How much value would he lose goongnwith another person?

I would talk with him and have something that proves your perceived value.