Ed. Note: Give DWB a warm welcome back to regular posting. If you’ve got a question for the advice column, email us at advice@goingconcern.com.
Good afternoon, everyone. Caleb must have tripped and knocked his sombrero-wearing-head last night, because he has invited me back for a weekly post. Regardless, I’m excited to be back. Let’s knock the rust off, shall we?
I am a 2nd year senior associate at a Big 4 firm. I like doing public accounting but am thinking that at my level and performance I am underpaid. I’ve several offers in hand but I do like what I am doing.
Now this does seem like a silly question – how do I go about asking for a raise without making it sound like that all I care about is money? In this economy…what are the chances that I am gonna get what I ask for?
Thanks a bunch!
You don’t specify whether your “several offers in hand” are for positions in the private sector or with other public accounting firms, so I’m going to address both.
Private sector – why are you interviewing with companies if you “like doing public accounting?” Turn these down.
Public accounting – you should be considering these offers if they are with another Big 4 firm. Do not go from Big 4 to mid-tier. Don’t have any offers with the other Big 4? See your own comments above and interview with the other firms. All four have problematic staffing issues this spring as the young guns continue to burn out. Sure, you’ll receive a nice little bump in pay when you transfer from one firm to another, but remember you’ll be down at the bottom of the networking food-chain.
Considering both the fact that you work at a Big 4 and it’s only a few months away from mid-summer raises and/or compensation restructuring, asking for a raise now will probably not lead to much. You work for an international firm responsible for more than 100,000 employees…you are one person. Granted, you are a second year Senior, which is one of the areas that all firms have a shortage at.
It also depends on your what practice line, your performance rankings and industry, as all of these factors play into how much leverage you will have. If you’re a top-ranked staff member with your CPA and on track to be a lead senior in the fall, your firm may toss you a $1,500 bone to keep you salivating for summer raises. If you’re more of the middle-of-the-road-and-I’m-studying-for-BEC type it would not totally surprise me if you were not given a raise or even shown the door. It would take the length of an episode of “30 Rock” for the word to spread through your office that all it took to get a bump in pay was to claim you had an offer from another firm. Leadership isn’t stupid.
Regardless of where you stand when compared to your peers, be absolutely certain you’re comfortable taking one of the offers you have should the latter situation happen. Your best bet is to wait until summer raises come through. The other firms will still be hiring experience staff in September.
I find it hard to believe that tax associates make $5-$8K more than audit associates upon graduation. That’s not what I’m seeing. In texas, the starting salaries are identical – otherwise, who would pick the lower-paying audit as a starting point? in fact with each Big 4, the starting salaries are identical regardless if you’re a 4.0 from UT or a 3.3 from U of H. It’s crazy, but it keeps starting salaries in line (and I mean low).
Possibly, these salaries are not considering the difference between a 4-year and a 5-year degree?
Tax getting higher salaries than Audit has been the standard in the industry for decades. The main reason being that most graduates/accountants hate working on taxes and prefer going the audit route. So the Tax side has always had to offer higher salaries to entice people to come over to their side.
These would look better if inflation isn’t what it really is.
I am living a quality of life equivalent (if not worse) to what I had when I graduated, which was 2-3 years before the covid pandemic…before anyone says anything about lifestyle creep, that’s not the case here. I buy my clothes at Costco, cook at home everyday (with the exception of eating out 1-2 times a month and that’s like $50 each time), my car payment is 5% of my after-tax income, I contribute 18% & 5% to my 401k and ROTH, make my own coffee at home, etc. My contribution to my 401k/Roth should tell you when my compensation.
Say what you will, but with the cost of living skyrocketing in the last 5 years (the cherry on top was my electric utility delivery charge and KW rate 2-3x this year)…100k+ a year doesn’t carry the same weight it did 5 years ago.
But maybe none of this matter if all these kids can’t even get jobs out of college…no wonder their demographic, which historically was dominated by one side of politics, flipped politics when one side told them nothing is wrong while the other is saying everything is wrong. Can anyone blame them?