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Learning, Sharing, and Teaching => Ask a Mustachian => Topic started by: SubL stache on July 11, 2019, 10:32:09 PM

Title: Relocation negotiation?
Post by: SubL stache on July 11, 2019, 10:32:09 PM
My company has asked me to move to a higher COL area to take on new responsibilities in a satellite office.  This is a great opportunity and long term I should be able to generate more business in this area and travel less.  We already checked out the area and we really like it and are excited to do this.

We will be selling our home and trying to get down there before school starts, mid-August...but I'm having trouble getting comfortable with the logistics.  I don't want to sign any rental lease before my home is under contract, but I also don't want to give it away.

The new offer will come with a higher salary to match the HCOL area and of course they are paying for trip to the area and moving expenses, but what other items should I be asking for?   I'm reading online that temp housing or company paid closing costs or even realtor commissions can be a thing...but is this reasonable or realistic?

I would like a rental stipend for say 2-3 months so that they pay my rent in new location while my house sells...that way I rest easy that I don't get boned with mortgage payment and rent due or that I don't have to fire sale my house just to get down there and get my kids in school by the first day.  What kind of things are normal for a relocation negotiation?

Title: Re: Relocation negotiation?
Post by: Paul der Krake on July 11, 2019, 10:36:04 PM
Depends on your job and company. It's not uncommon in my field for relocation packages to be worth around 20k.
Title: Re: Relocation negotiation?
Post by: reeshau on July 12, 2019, 03:32:36 AM
Yes, in my experience (auto industry) those would all be standard:

1) Realtor fee and closing costs.  Won't cover selling more than 5 acres of land.
2) "guaranteed" buyout amount.  (low bid, but not lowball) just so you won't get caught out with the house.  Matched with incentive to sell, so you don't automatically take the buyout
3)  paid movers, with one month storage to accommodate finding a new place
4)  Look-see trip, with local agent to see neighborhoods / schools
5) short-term accommodation; maybe just 1 month if you rent in your new location.  Maybe 3 months if you plan to buy (to allow for closing)
6) Incidentals stipend / relocation bonus
7) Move your car (so you can fly)
8) Move your pets

It's not as good as it used to be, but it still is pretty good at getting the job done.  It's also highly discretionary with the HR manager / business unit director:  don't look to make money with it, and they should support you.

My first move, just out of college, I took a "self move option" with a U-Haul truck and cash.  Now, I'm happy to have people do it for me.  (I don't think self-move is even around, any more; too much risk on all parts)  I also once bought a fax machine at midnight from Wal-Mart, because there was no Kinko's in the small city, and the buyer wanted to close "immediately."  I didn't grouse about that crazy purchase; that's the kind of crazy the stipend is meant to cover.  I did talk my company into moving most of my goods to Texas, rather than to Ireland, in my most recent move:  I will go to Texas when I return, and moving within the US is much cheaper than internationally, so they bought it.

If you think you have a novel / non-standard situation, make the business case for them.  Even given all this, there are still the really important things (heirlooms, important documents) that we moved ourselves, at our expense.  This is a one-time thing, so it's not worth maximizing at the expense of ongoing or irreversible pain.
Title: Re: Relocation negotiation?
Post by: SubL stache on July 16, 2019, 09:13:54 PM
Thanks for the input.  I received my offer this week.

2 trips down to the area, all expenses paid.  5k in moving expenses or higher if quotes received.  (I think I can do it with hiring muscle and driving the truck myself for ~$1500).
Temp housing assistance as needed, they will pay my mortgage for up to 90 days while home is in process of selling.

The base was slightly lower than I had hoped, but a nice custom bonus plan was attached that I should be able to capitalize on.

The kicker that I was not expecting is that they will reimburse my realtor commissions once I buy a new home!

I came out better than I thought I would.
Title: Re: Relocation negotiation?
Post by: terran on July 16, 2019, 09:22:39 PM
If possible, try to get the reimbursement grossed up. Moving expenses are no longer deductible, so you'll pay taxes on the reimbursement. Although, it sounds like you're saying they'll give you a flat $5k and you think you can do it for less, so that works too.
Title: Re: Relocation negotiation?
Post by: Better Change on July 17, 2019, 05:01:44 AM
Can confirm: check the tax gross-up on the reimbursement benefits.  Our relocation "benefits" amounted to ~ $100k in total (including realtor/real estate fees and commissions; we sold and then bought), and we got socked with an additional $9k in taxes last year.  However, our lump sum was $18k, so we came out roughly even after all was said and done.
Title: Re: Relocation negotiation?
Post by: reeshau on July 17, 2019, 05:54:58 AM

2 trips down to the area, all expenses paid.  5k in moving expenses or higher if quotes received.  (I think I can do it with hiring muscle and driving the truck myself for ~$1500).

Good luck with the move--I assume you accepted?  You didn't outright say it.

In reference to self-moving, more power to you if you can, but do think about everything else you will be doing.  Those days on the road are ones not looking at a house, signing / getting paperwork in order, or working with a school district outside of their normal calendar.

The opportunity is there, but the healthiest viewpoint in these circumstances are like @Better Change 's:  look to make sure you come out even, rather than optimizing one particular line item.

I also triple-confirm the gross up recommendation.  At least, know how they will treat it, so you can save up the cash for tax day.