How To Answer “What Are Your Total Compensation Expectations?”

Updated June 9, 2023

During the interview process, employers may ask what your expected total compensation is for the open role. Being prepared to answer this question can help you make a positive impression during your interview.

In this article, we discuss how to answer questions about total compensation expectations and why the question is important.

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Why do employers ask "What are your total compensation expectations?"

Employers may ask this important interview question for many reasons, including:

To gauge affordability

One reason employers may ask this question is that they want to gauge your desired income range. While employers ultimately have the final decision regarding compensation, understanding your expectation can tell them if your ranges align with theirs. If your range vastly differs from theirs, they can determine whether they can fill your expectations as a member of the team. For example, if your price expectation is low, they can determine that you may be easier to satisfy than if your price was high.

Related: How To Provide Your Desired Salary (With Tips and Examples)

To understand your expectations of the company

Another reason employers may ask this question is that they want to evaluate your expectations for the company. Your compensation expectations apply not only to your starting rate but also to what you may receive in the future through promotion and other compensation benefits. Learning your expectation for compensation during an interview can help the interviewer compare your rates to what the company can offer and if these rates align.

Related: Tips for How To Write Your Expected Salary in Your Resume

To understand you more intimately as an employee

Employers may ask you about your compensation expectations to better understand you as a potential employee. Your expectation for compensation and salary can help an employer understand how you view the industry and company. The amount you request in comparison to what the company compensation is, the better they can determine your experience in the industry and your expectations of the company.

Related: Responding to Salary Requirements Questions (With Tips and Examples)

Why is answering "What are your total compensation expectations?" important?

Answering "What are your total compensation expectations?" is important because :

It tells your employer more about you

Sharing your compensation expectations with your potential employer is important because it gives them information about you as a future employee. Not only does it tell them about your experience in the industry, but it can also display your professionalism and personal expectations within the company. With this question, you can also provide more information about why you feel the amount is reasonable and justified by sharing your experience or knowledge in the industry.

It helps prepare you for compensation amounts

Stating your compensation expectations during an interview helps prepare you to understand the compensation amounts for each employer. When you answer this question, it prompts the interviewer to discuss compensation benefits for the company, including details such as pay, vacation rates and compensation bonuses. Answering this question honestly can both prepare you and help frame your thought process concerning the company's current benefits.

It gives you an opportunity to illustrate your skills

When answering this question, you may have the chance to immediately follow up with some valuable statements that can help your application process. If you suggest a compensation expectation, you can also take time to explain how you came to this amount, further illustrating your skills to your potential employer. You can also use this question to state reasons your expectation may not align with the company's compensation package to further demonstrate your knowledge of the industry.

How to answer "What are your total compensation expectations?"

If you want to answer this question during an interview, consider reviewing the following steps to help you plan your response:

1. Research the industry and geographic area

Before your interview, consider researching both the industry and the geographic area of the company where you're applying. Learning about the compensation before your interview can help you evaluate your answer and ensure it falls within the current salary range. If your rate differs from the average, ensure you can justify your reasoning. If your rate is drastically higher or lower than the rate you research, it may be best to adjust your answer to help your expectation align with the company's offerings.

Related: How To Disclose Salary Requirements

2. Emphasize your flexibility

When listing your compensation expectation to your potential employer, emphasize your flexibility for better acceptance during your interview. When you emphasize your flexibility concerning a rate, it gives the potential employer more reasons to consider you as a candidate for the position. Flexibility shows that you're accepting of a lower rate. This flexibility can apply in areas outside of payment as well, such as for workloads and responsibilities.

3. State a range rather than a fixed amount

Another way you can state your salary expectations is by offering a range of prices rather than a fixed amount. Having a range rather than a set price can help your potential employer compensate you better for your needs. A range may tell the potential employer more about your experience and knowledge than a fixed rate. Sharing a range of rates also demonstrates your flexibility to your potential employer.

4. Consider offering high compensation

When making your compensation expectation statement during an interview, consider offering high compensation as your answer. If you expect an amount close to what you researched, offering a higher amount can show your potential employer that you've researched and understand the industry. Stating a lower-than-normal price for the sake of modesty, while polite, may give your interviewer a misleading perception that you don't understand the average industry salary. Stating compensation expectations that are higher than average can show that you're both ambitious and knowledgeable in your industry.

5. Be honest

If you're honest concerning your desired salary, this may show your interviewer that you're willing to work toward your goals and those of the company. This is why researching the average compensation rate before your interview can help inform you of your answer, making it as close to the average rate as possible. Creating an honest answer that you can clearly express to your interviewer helps improve the integrity of your expectation.

6. Focus on why you expect the amount

When stating your answer, prepare to explain why you selected the compensation amount. Recounting your research, past positions and realistic expectations can all help illustrate your experience and integrity to your interviewer. Explaining your answer also ensures that, regardless of whether it's above or below the average rate, you're flexible and can work with the company.

7. Prepare for price negotiation

When stating your answer to this question, consider preparing for compensation negotiation. Whether your price is lower or higher than what the company can offer you, there may be room for negotiations on both sides. If you offer lower than what the company offers, negotiating can ultimately help your pay rate. If you request an amount that's higher, compromising can help your chance of getting the position.

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Example answers to "What are your total compensation expectations?"

Below are a few ways you can answer questions about your compensation expectations:

Example 1

"My salary range is pretty flexible. While I do want to be compensated fairly for my experience and good sales record, I understand that industry rates are always changing. I'm very open to discussing different ranges after we discuss some position details. Optimally, I expect the compensation to be between $30,000 and $50,000. I estimate this range based on some of my last positions and also the industry standard."

Example 2

"While my salary requirements are very flexible, I think my experience in the mechanics field adds value to my employment in this company. Depending on my responsibilities, I've estimated a range of about $40,000 to $60,000 plus commission work. I'd like to discuss this range more, if possible, after learning about what I'd be handling in this specific position. My past positions had a similar compensation amount, but as we talk, I'm sure we can determine a fair salary for what I'll be doing."

Example 3

"I'm open to discussing the details of my salary, but for my position with my previous expertise, I expect between $60,000 and $80,000 per year. However, before settling on an actual rate, I think it may be best to discuss more of the details concerning daily tasks and responsibilities. I understand that this range can vary, probably far from where I've set it, but it all depends on what additional tasks I might receive daily from other departments."

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