A signing bonus is a one-time payment offered to a new hire as an incentive to accept a job offer, typically in addition to the salary and benefits. Knowing how to ask for a signing bonus might seem intimidating, but it can make all the difference in securing the best deal possible for yourself.
You might be wondering, “Should I request a signing bonus? Is it too much to ask as I’m about to start a new job?” The truth is, requesting a signing bonus is not only acceptable but often expected, especially in competitive job markets and certain industries. Companies use these bonuses to attract top talent, and it can be a valuable tool for you as a candidate.
But how exactly can you go about asking for it? This article will walk you through the process and provide useful tips for negotiating this common but important part of the hiring process.
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What is a signing bonus?
A signing bonus, or sign-on bonus, is a financial incentive companies use to make job offers more attractive, especially when competing for talent or wanting to sweeten the deal without permanently increasing salaries. It helps companies compete with larger firms offering higher base salaries by leveling the field.
“It’s important to note that signing bonuses aren’t guaranteed,” says Melissa Trager, a career adviser and founder of Resume All Day. “They can be part of a job offer, but they’re not always included.”
How does a signing bonus work? When offered, you'll receive the bonus either in full or in parts, typically when you start. In some cases, the bonus may be tied to performance goals, which means you'll receive it only if you meet specific expectations.
Bonuses are usually paid in cash, though some companies may offer perks like stock. Keep in mind that they're taxed like regular income, so the amount you take home will be less than the total bonus, depending on your tax bracket. Be sure to review your contract or speak with HR to understand the specific terms of your signing bonus.
How to ask for a signing bonus
A solid strategy is key in how to negotiate a signing bonus. Know when and how to ask, balancing tact and assertiveness for better results.
Do your research
Before asking, find out if signing bonuses are common in your industry or for the specific role. For example, they’re more common in industries like tech, finance, and healthcare but less frequent in education or non-profits. Research average signing bonuses for similar positions in your area to gauge what’s reasonable to request.
Wait for the right moment
Timing is everything when it comes to discussing a signing bonus. “The best time to bring it up is when you’ve got the offer but haven’t signed yet,” Trager says. “At this stage, you have maximum leverage because they already want you on board, and they’re hoping to complete the hiring process.”
Frame it as a discussion
When approaching the topic, use a collaborative tone. Introduce the idea of a signing bonus as part of the conversation, not a demand. For example, say, “I’m really excited about the opportunity and the role. I’d like to discuss the possibility of a signing bonus to help cover relocation costs.”
If relocation isn’t part of the equation, you could frame it differently, such as: “I’m thrilled about joining the team and contributing to its success. Would it be possible to discuss a signing bonus to help offset the transition period while leaving my current role?”
Quote a specific number
If you know the amount you need or expect, be clear about it. You can say, “I’ve done some research on similar roles in this industry, and signing bonuses around $8,000 are common. I’d like to suggest a bonus in that range as part of our agreement.”
Justify your request
Consider personal circumstances that might necessitate a signing bonus. Presenting your request with solid reasoning and evidence shows that you're well-informed and serious about the negotiation, increasing the likelihood of a positive outcome.
“I would recommend asking for this bonus to make up for something that you would be leaving behind from your current employer,” Trager says. “This could include an end-of-year bonus, stock options that have not yet vested, a relocation stipend, or any other financial benefits you might be sacrificing by making the move.”
Be grateful
Always take a moment to thank the employer for the offer. Show genuine appreciation for the opportunity and the potential it holds for your growth. A positive and thankful attitude makes a great impression and sets the stage for productive conversations about additional perks like a signing bonus. Employers value respect and humility, and being gracious can go a long way in creating a supportive negotiation environment.
Be prepared to negotiate
The employer may not agree to your exact request right away. Be open to negotiating and consider other ways they might meet your needs, such as a performance-based bonus or a signing bonus paid in installments.
This might help: How to Negotiate Salary: 34 Tips You Need to Know (Plus, Examples!)
Get it in writing
Once you and the employer have come to an agreement, ensure that the signing bonus is clearly documented in your contract. Having it in writing avoids any confusion later and ensures both you and the employer are on the same page about the terms, conditions, and payment schedule. It’s a simple step that gives you peace of mind and solidifies the agreement.
FAQs
What is another name for a signing bonus?
Both “signing bonus” and “sign-on bonus” mean the same thing. It’s just a way to give new hires a little extra upfront to make the offer more attractive. Signing bonuses are usually guaranteed unless the contract says otherwise. Some companies add conditions, like a requirement that you pay it back if you leave the company before a set amount of time.
What’s the average signing bonus?
“Depending on the role and industry, signing bonuses can vary drastically, from as low as $2,000 to $5,000 for an entry-level role to upwards of six figures for more senior roles,” Trager says. This variation is influenced by factors such as the rarity of the skill set, the urgency of the hire, and the economic climate, which can all impact the size of the signing bonus.
Does signing bonus count against salary?
Bonuses don’t affect your salary, but they do add to your total compensation package. To avoid confusion, clarify with HR how the bonus fits into your overall pay. Some companies pay the bonus upfront, while others spread it out over months or tie it to performance goals. Always ask when and how you’ll receive it.
What should you consider before accepting a signing bonus?
Before accepting a signing bonus, think about the conditions attached. Some companies might ask you to repay the bonus if you leave the job within a certain period, often called a “clawback” provision. Also, consider how the bonus might affect your taxes, as it could push you into a higher tax bracket. Understanding these details will help you make an informed decision that benefits your financial situation in the long run.
What are some jobs that frequently come with signing bonuses?
“Finance roles and big law often include signing bonuses due to their competitive nature,” Trager says. These industries seek to attract top graduates and experienced professionals by offering lucrative compensation packages, which often include substantial signing bonuses.
Do engineers get a signing bonus?
“Engineers at all levels—from entry-level onward—typically receive signing bonuses,” Trager says. “The amount will vary depending on the size of the company, bonus plan, and engineer's base salary.” This is because companies compete for top talent in engineering fields, where the demand for skilled professionals often exceeds supply.