Before I get into that, however, the most important step comes before the question is asked. You should already have a sense of what a position pays based on title, hiring company, and a number or range published in the position advertisement. At the very least you should be able to deduce a range within a standard deviation or two.

I agree that the candidate should have researched and prepared for this question prior to the interview…it’s not like it’s a trick question. Looking at one’s total compensation history, you know what you’ve made in the past that supports your present standard of living and from that you can form a total value of your worth and understand the balance between direct and indirect earnings. If a salary discussion trends toward a lower salary, you know to ask about bonus/stock programs to get you to the total you want.

It’s also critical to understand your lifeplan budget. Especially today, anyone who doesn’t have a spreadsheet-based personal budget needs to build one. Include your mandatory costs (i.e. rent, mortgage, lights, car), your estimated discretionary expenses (dining out, entertainment, etc.) and your future investments (savings, emergency money). This will bring you to an optimal number. Then cut until you reach a worst-case number.

Now you’ve got your answer. When asked: “What is your salary expectation?” you can answer crisply with your OPTIMAL number “I’m accustomed to a base annual salary of $X.” No dancing around. If the hiring manager tells you that your expectation is outside the range, your option is to ask about total compensation options. If that fails to resolve it, then it’s the wrong position for you or you failed to do your homework on the position.

At the end of the day, there’s no reason not to be able to answer the question directly and crisply with a number that’s right for you. If the hiring entity believes you are the most qualified candidate, they should be willing to pay for it. If there’s doubt, remember, the strongest position you can take in a negotiation is being willing to walk away from the table.