How to ask for a signing bonus and tips to negotiate incentives

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In a Nutshell

When asking for a signing bonus, a few strategies may help prepare you before negotiating, including waiting for a job offer, researching industry averages, having a set amount in mind, being open to negotiating and getting any offers in writing.
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A signing bonus can be an appealing part of a new job offer. However, if a company doesn’t offer you a signing bonus in its initial offer, you still may be able to negotiate one for yourself. We’ll review how to negotiate a signing bonus, the pros and cons of these payments and some financial goals a signing bonus may help you achieve.

What is a signing bonus?

A signing bonus, also known as a starting bonus or a sign-on bonus, is a monetary incentive a company offers you to work for them.

These types of bonuses are more common than you might think. A WorldatWork study found that in 2022 signing bonuses were offered by 88% of the organizations it surveyed.

Depending on your industry and title, a signing bonus can have a wide range. Depending on your position, they could range from just a few hundred dollars to more than $50,000.

Whatever the amount, a signing bonus can be a great financial tool since you can use it to get out of debt, start an emergency fund or finance another personal goal.

By offering this type of incentive, the company may hope to make the offer more attractive and compensate for you switching jobs or denying other job offers.

Average signing bonus

The signing bonus amount is relative to the industry and position you are applying for. Recent studies have shown that managers and executives may receive between $10,000 and $50,000, while more technical workers tend to receive less than $5,000.

Since bonuses can range so widely, it’s wise to do industry research to find what may be reasonable in your field before negotiating with a prospective employer.

For example, Merritt Hawkins found the average signing bonus for physicians was $31,000 between April 2021 and March 2022. This increased from the previous year ($29,656), showing why it’s important to research your industry’s averages before negotiating.

Signing bonuses pros and cons

Signing bonus pros

Here are some of the possible benefits of ask for a signing bonus.

  • Offsets costs of starting a new job — A signing bonus could offset potential financial hardship in between jobs.
  • It can be a good investment By putting your signing bonus into an investment account, you could leverage the power of the stock market to grow your money over time.
  • Could be used as leverage Let’s say two companies offer you a job, but only one offers a bonus. You may be able to use the starting bonus from one company to negotiate a better salary with the other — or even to ask for a better signing bonus from them.
  • Compensates for fewer benefits A sign-on bonus could compensate you in a different way if the job doesn’t provide a good benefits package or only offers less than your desired salary.

Signing bonus cons

It may seem like there are no cons to having extra money in your pocket, but here are some reasons you might not want to ask for a signing bonus:

  • Could be compensating for a lower salary — Sometimes companies will offer bonuses to make the job offer more attractive, but you may be missing out on additional salary from another company with more competitive pay.
  • Signing bonuses are taxed As you might have expected, signing bonuses are taxed. Since hiring bonuses aren’t added to your income, they count as supplemental income and are taxed.
  • There could be a fine print Like with every contract, remember to read the fine print. Will you receive your signing bonus immediately? The hiring company may put clauses in the contract that could prevent you from getting your money immediately or only allow you to get it under certain conditions.
  • You might need to repay the bonus if you leave the company If you decide to leave or are laid off, you could be subject to repay the signing bonus you received depending on the time that has passed.

How to negotiate a signing bonus

If after analyzing your potential benefits and losses, you decide that asking for a signing bonus will work best for you, the next step is to prepare to negotiate.

Here are five steps and tips for negotiating a sign-on bonus.

Step 1: Wait for your official offer

After receiving your official job offer with your proposed salary and benefits, you will have more information to gauge your potential bonus opportunity. And if you’ve already been offered a bonus, you might have an advantage in negotiating for a better one.

Step 2: Research salary and bonus opportunities

Doing research before negotiating a signing bonus can help you prepare for the discussion with facts and data.

Start by …

  • Researching the company to find what benefits are offered and ask your professional network for some insights into the company’s compensation specifics.
  • Researching the salary of others in your industry — including the benefits and bonuses — and compare that to your official offer.

Step 3: Have a set amount and reasons why

If you have a set number you’d like to receive for a sign-on bonus and why, you may be better able to defend that number in your negotiations.

Try to be precise, use comparisons and show what value you can bring to the company.

You could mention company X provides a higher salary, and company Y offers a great benefits package — or even that company Z offers a bonus for candidates with the same qualifications as you.

If you’ll be losing out on a bonus at your current company by leaving for a new job, you could also negotiate to replace that compensation with the sign-on bonus.

Step 4: Be open to negotiations

Be open to negotiating your signing bonus. If the hiring manager wants to offer you a smaller bonus, having a minimum amount you’re willing to accept and good reasons behind it may help you counteroffer more successfully.

For example, a counteroffer could be to split the bonus amount and add the other half to your yearly salary instead. Or you could ask for 75% of the initial offer but request extra benefits, such as vacation pay or an insurance plan.

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Step 5: Have it in writing

Like your negotiated salary, your signing bonus should be part of a contract. Having it in writing may give you some recourse if you haven’t received it by the date you agreed on. If the employer doesn’t provide a contract with your bonus, you should request one.

Ensure all the details and conditions are present in the contract. It should include the bonus amount, when and how it will be paid and how long you must stay employed to keep the bonus.

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Smart ways to grow your savings with a signing bonus

One of the pros of a signing bonus is that it may be a good investment. If you aren’t sure how to maximize your bonus, here are some ways to potentially grow your savings with it.

1. Start an emergency fund

Having an emergency fund can be a tool to build a solid financial foundation for yourself. Unplanned events happen, and an emergency fund can help you. If you don’t already have an emergency fund, it might be a good idea to consider starting one with your bonus.

2. Invest in the stock market

Investing in the stock market can be a great long-term investment. According to, people who invest in stocks for the long term tend to see strong, positive returns. By investing your signing bonus in the stock market, you may be able to multiply it over time.

3. Pay off outstanding debt

The average debt of Credit Karma members was about $50,000 in late 2022. Being debt-free is a goal many people have. If you’re one of the millions of Americans in debt, a signing bonus could be a good option to start moving in the right direction.

4. Put it toward student loans

About 43 million people carry student loan debt. Using your signing bonus may help you pay down a chunk of your college debt.

What’s next? Make a financial plan.

Now that you know how to ask for a signing bonus, you can start planning how to use it to make financial progress. If you plan on using your signing bonus to help you pay down your debt, creating a debt repayment plan can help to keep you on track.

With this information in mind, decide how much money you can dedicate toward paying down debt each month and plan how to use it. You may decide to use the snowball method, the avalanche method or other strategies. What matters is that you pick a plan you can stick to.

If you have another financial purpose in mind, figure out a timeline and plan for how to spend your signing bonus to achieve that goal.