New job, new salary, new city. It can all be very exciting, but if you’ve miscalculated during your salary negotiations, it can have dire effects on your new cost of living. And there is nothing exciting about that.
If you’re relocating for a job, you need to step up your game, and learn how to negotiate. Fortunately, you can build a case for your new salary that practically sells itself. Here’s how:
- Calculate your current cost of living. Whether you’ve completed your job search or have just begun, the first step is to establish a baseline cost of living to work from. This is best done by assessing your current situation. Look at your budget, and determine how much you spend on housing or rent, utilities and other bills as well as entertainment and savings.
- Calculate your future cost of living. Now, this takes a bit of research. Look at housing and apartment costs, estimate monthly bills as well as entertainment, groceries and any other foreseeable new costs. For instance, if you’re moving from a small town to a larger city, you may have to consider monthly parking costs when you didn’t before.
- Compare the two. There is a complicated formula for figuring this out. You can subtract the cost of living index where you currently live from the cost of living where you’re considering relocating. From there, you divide that figure by the cost of living index in your current location and multiply this by 100. This tells you how much of a reduction you can tolerate, or how much of an increase you need, to live at your current cost of living after taxes in your new location.
But if you’re horrible at math, and that formula just terrified you, there are easier ways. There are a plethora of cost of living calculators, including this simple-to-use tool from CNN Money. It not only provides you with the salary you need to make when relocating but also the percentage increase or decrease for groceries, housing, utilities, transportation and health care.
- Identify your target salary. If the cost of living for you in your new city is $70,000 and you’ve been making $80,000, don’t go into your salary negotiations asking for $150,000. Use common sense. Consider your future cost of living and the position you’ve been applying for. If it’s the same position in your current city, your target salary should be at the same level or a little higher considering your new city’s cost of living.
- Don’t settle. At the same time, don’t settle on the first job offer and figure they give you. Have a minimum salary in mind — one that makes the move and the new job worth it all to you. If they don’t offer your minimum salary, push for it. After all, this is more than just a job. At this point, it’s your entire life that you’re uprooting and moving.
What else should you keep in mind during salary negotiations when you’re relocating? Share now in our comments!