The Best Way To Respond To Your Expected CTC In An Interview
Sindhu Chandra
Human Resources Manager at Intellectt Inc specializing in Talent Assessment and Mentoring
While interviewing for a new job, an employer may ask you about your salary expectations. Although many interviewers save this question for later, others may ask it earlier in the process or when it is time to negotiate your offer. It is important to prepare for this question as it can maximize your negotiating power.?
“What is your current CTC?” and “How much salary are you expecting” are common HR interview questions where the recruiter opens the channel of discussion regarding money.
These questions allow the recruiter to understand whether you are aware of your own valuation and whether you will be able to fit into their company budget for the role.
Often we get confused about the details to provide when answering “What is your current CTC?” We either tend to give the bare minimum information or evade answering this HR interview question altogether.
If you are someone who faces the same confusion, then this is the blog for you!
1. Understand the components of CTC:
The CTC is a company's total expenditure on an employee, including monetary and non-monetary expenses. Basic salary, allowances, and deductibles are the three major components of CTC. Basic pay is normally not more than 40% of CTC. Allowances and deductibles may vary based on the type of company, their internal policies, and company size. Knowing more about the different components of CTC can help you negotiate a better deal during an interview situation.
Other allowances and deductibles of CTC are:
2. Examine market trends for salaries:
The location and size of the organization may cause some variances in salary patterns, which are often uniform. On employment search web pages, you may look at current salary. Be sure to take into account your potential competitor's expertise, skill level, working circumstances, dangers, travel needs, and benefits. For different positions across many sectors, several organizations publish wage recommendations and compensation surveys. To learn more about current CTC trends, do some research on these.
3. List a range of salaries:
If a firm contacts you for an interview after screening, it suggests that they are open to the idea of paying you more than your current CTC or matching it. If the subject of predicted CTC is raised, provide a range based on your prior wage research and your present pay that you feel comfortable with. Before expressing your estimated income range, take into account the allowances, perks, and other factors that are added to your take-home pay.
For instance, if your study shows that the typical annual compensation for your position is $6,000, you might add larger figures as projected CTC. Alternatively, you might indicate a range and add 15% to 20% to your present CTC. Mentioning
4. Be prepared with a logical defense:
If you offer a possible CTC range, the interviewer could or might not inquire as to the basis for the figures. Be ready with a response. To support your anticipated CTC, you might showcase your credentials, abilities, and experience.
5. If necessary, sidestep the inquiry:
Before asking you questions about the work, an interviewer may first inquire about your anticipated CTC. You can politely decline by expressing that you'll respond when you've learned more about the position and its duties. If they are prepared to provide the wage range they can give for the role, you may also respectfully inquire.
6. Mention the anticipated CTC in formal rounds:
For entry-level and mid-level jobs, the standard procedure may require you to go through three rounds of interviews. The hiring process is more involved, formal, and involves several rounds of interviews for senior and executive positions. When there is a mutual understanding of your credentials, talents, abilities, and new duties during the second or third round, it may be perfect to share your projected CTC.
7. Be prepared to negotiate:
It's essential to understand your CTC components so you can bargain effectively. You can haggle for higher base pay. Although the firm might not be able to afford your wage range or give many perks, they could be open to giving you equity. Additionally, you can bargain for benefits.
How to respond to the question, "What is your current CTC?"
You may answer the question "What is your current CTC?" during your HR interview round by using the following advice.
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Review your assessment and offer letter:
You can get a detailed breakdown of your total CTC in your offer letter or evaluation letter. This will provide you with an understanding of the components and advantages your present organization offers, and it will assist you in providing a thorough response to the question "What is your current CTC?"
Thoroughly understand your monthly pay slip:
When answering “ What is your current CTC?” it is important to have a clear understanding of your net salary after deductions.
Remember, you will need to submit your salary breakup/ pay slips if you bag the job so fibbing will only land you in trouble.
Avoid lying about your net salary or to any of the HR interview round questions.
Identify the fixed and variable component:
Your CTC comprises of various elements, some of which are fixed like your basic HRA, EPF, etc while others are variables such as quarterly/half-yearly/annual bonus, incentives, profit sharing, retention bonus, Rewards & recognition (R&R), etc.
Usually, working professionals don’t pay much attention to the constituents of their salary breakup. This can dampen their chances of leaving a good impression when answering “What is your current CTC?” as it projects them as ill-informed.
Knowing these factors will not only help you negotiate better but will also show that you have an understanding of your salary breakup.
Discuss your in-hand salary too:
Similar to answering any other HR round interview questions, you must be able to answer “What is your current CTC?” properly.
You should be able to break down your in-hand salary or net salary along with your gross breakup to be able to give a concrete answer for any follow-up question after “What is your current CTC?”
Mention additional perks or incentives, if any:
Make sure to mention any additional incentives or perks apart from your net salary and other breakups of your salary. This will give the recruiter an idea of what you receive and what you’ll be expecting from the company.
“What is your current CTC?” may seem easier to answer than the rest of the HR round interview questions. However, do not take it too lightly as it can still affect your chance of bagging the job.
You don't want to give the impression that you solely care about your take-home pay and are unaware of your entire CTC. This can cause the hiring manager to reject your application.
In order to provide a thoughtful response to the question "What is your current CTC?"
Hope this blog helps to answer about CTC .