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Originally Posted On: https://lifeswork.coach/how-to-negotiate-a-signing-bonus-at-your-new-job/career-success/
Negotiate a Signing Bonus at Your New Job
When you’re offered a new job, it’s normal to feel ecstatic. After all, you’ve worked hard to get to this point in your career and you deserve it. But before you sign on the dotted line, there’s one more important thing to consider: your signing bonus.
A signing bonus is a lump sum of money that is paid to you when you start your new job. It is typically used as a way to entice top talent to join a company. If you’re lucky enough to be in a position to negotiate a signing bonus, there are a few things you should keep in mind.
The EMPLOYER PERSPECTIVE
There are a number of reasons employers will extend a pre-hire bonus, sometimes called a signing bonus or sign-on bonus.
- In a competitive market employers may use a signing bonus to attract new talent.
- A signing bonus is a great way to compensate a new hire for benefits or commissions that the new employee is walking away from. HIring sales people mid-quarter or executives mid-year can often be made easier with a signing bonus.
- A one-time signing bonus can meet the candidate’s salary expectations for year-one. In this case it incentivises the new hire to perform well to make up the difference in year two by achieving bonus potential or getting an increase.
- A sign-on bonus can be an incentive for a new employee to stay with a company for a certain period of time after accepting the position. In most cases there is a one-year period in which they are required to pay back the bonus should they leave the company.
WAIT TILL YOU GET THE OFFER
This may sound like common sense but…
Don’t ask for your bonus before you get an offer letter. It is hard to negotiate without the offer and it could hurt your chances (or the employer could bake it into the offer.)You’ll be in a better position to know what to negotiate for once the offer is clear; base, benefits, insurance, vacation time, bonus potential, etc…
DO YOUR RESEARCH
Before you even start negotiations, it’s important that you do your research. Knowing what the going rate is for your position will give you a good starting point for negotiations. You can use salary databases like Glassdoor or PayScale to get an idea of what other people in your position are making.
KNOW YOUR WORTH
In addition to knowing the going rate for your position, you should also have a good understanding of your own worth. Think about the skills and experience that you bring to the table and how they will benefit the company. This will help you confidently negotiate for the salary and benefits that you deserve.
Look through the following and take some notes for any conversations your request for a signing bonus initiates:
- Years of job/industry experience:
- Licenses and certifications
- Managing/leadership experience
BE SPECIFIC ABOUT YOUR NUMBER
- Decide on the minimum number that will work for you.
- Ask for more.
What you ask for at first is rarely what you’ll end up getting as they will likely counter offer. Most employers expect you to negotiate.
SHOW YOUR CARDS
Most companies negotiate in good faith, you should too. Signing bonuses, or sign-on bonuses are used in some very specific circumstances in most cases. They can be used to gross up your salary expectations, to make up for commissions or bonuses lost due to timing, or to cover a small relocation or company changing expense. If you are clear about your situation with your future employer about why you are asking for this offer incentive you may be pleasantly surprised.
BE PREPARED TO COMPROMISE
Remember that negotiation is a two-way street. While it’s important that you advocate for yourself, be prepared to compromise in order to reach an agreement that works for both parties. For example, if you’re looking for a higher salary than what’s being offered, you may be able to negotiate more vacation days instead.
Another simple tactic that can work is to ask for a guaranteed bonus of 100% (in situations where you will earn one) in the first year, this may work for them and will get you closer to your target salary.
If you have an offer in hand, congratulations! But before you sign on the dotted line, be sure to negotiate a signing bonus that meets your needs. With a little research and preparation, you can confidently ask for—and get—the compensation package that you deserve.
For more tips on negotiating your job offer check out this article: How to Negotiate Your Salary After the Job Offer.
Free workbook Amazing
If you’re like most job seekers, you want to receive a better job offer. But you know that over 70% of people don’t negotiate their job offer!
That’s because they don’t know how to stand out and confidently ask for what they want. But you’re different. You’re taking action and that’s why I created the Signing Bonus Workbook. This workbook will help you prepare and confidently negotiate a signing bonus.
In just a few minutes, you’ll be on your way to getting the rewards you deserve. So don’t wait, download the workbook now. It’s fast, easy, and best of all, it’s free