Congratulations! That dream of being signed by a Major Label will soon be realized. We know how important this moment can be and that it’s not just the fame that you are excited about, but that finally, you can see all your dreams coming together. From paying off your loans or old debt to the meeting and hiring of the best talent in the industry. All this is certain to push your career to the next level and that is all easier done when you have people at the top of the industry betting on you.
You no longer need to balance music and your 9 - 5 job. You can do music full time. And to make it easy for you to decide, the Record Label is offering a signing bonus. That check is already in front of you and waiting for you to decide. Should you take it?
Let’s admit it, It’s normal for most people to get attracted to something that is “free” or “extra” especially if it’s already in front of you. It’s just something irresistible. But the question is, is the signing bonus really free?
Understanding how it works and knowing the possible reasons why they are provided can probably help you decide on whether or not the signing bonus is going to be worth the risk. Let’s find out.
Why would you be offered a signing bonus anyway?
The main purpose of signing bonus is to get you to sign a contract. When you’re someone who shows great potential, companies would line up and compete against each other with all the benefits they can offer to the table just to get you signed. This is when they would offer a sign-on bonus. A one-time cash incentive that would be so attractive that will make you shift your focus on that pot of gold. When the company is hiring you and really wants you to take the offer, that’s when they’d usually offer a signing bonus.
What you need to know about Signing Bonus
Bonuses may come in a form of cash, stock options, vacation, and other benefits
It is usually 10% or more of the potential hire’s first-year base pay
If the person quits within a certain period of time after signing a contract, he may be required to pay back all or part of the signing bonus
It can be negotiated if it’s not part of the offer. Especially if the salary given to you is lower than what you expected. However though, if the company is offering a signing bonus, you can still also renegotiate the salary by asking if you can cut down the signing bonus for let’s say at least 25% so it can be added to your salary.
What lies behind the signing bonus
We know that you are eager to get the signing bonus and we’re excited for you too! But hold off, you might want to check these things to see if the signing bonus is really worth it.
Make sure you ask these important questions for yourself and your career, before moving forward:
Will you be required to stay for a period of time?
The typical initial length of every contract is one year. The signing bonus is given even before the job is done...
Will the money be given upfront?
Will you still be given a year-end bonus?
Is the sign-on bonus going to be worth it?