Transition offers are often described by one big number, such as "300% of trailing twelve." That number hides most of what matters. Here's how to break an offer down so you can compare two of them fairly.
1. Separate the parts of the deal
Most transition packages combine several pieces. List each one separately:
- Upfront money: usually a forgivable loan paid when you join and forgiven over a set number of years.
- Back-end or deferred bonuses: paid later, often tied to staying a certain number of years.
- Contingent bonuses: paid only if you hit asset or production hurdles.
- Ongoing economics: the payout grid, expense reimbursements and any equity or ownership.
2. Money later is worth less than money now
A dollar paid in year seven is worth less than a dollar today, both because of time and because you might not be there to collect it. Discount deferred amounts back to today's value before comparing.
Try it yourself with our offer comparison tool. It does this math for two offers side by side.
3. Be honest about the hurdles
Contingent money depends on how much of your book actually moves, and how quickly. Be conservative about how many clients will follow you, and weight that money by a realistic chance of hitting the targets.
4. Count what you leave behind
Unvested deferred compensation, retention notes you'd have to repay, and lost bonuses at your current firm all reduce the real value of a new offer.
5. Read the fine print with an attorney
- What happens to an unforgiven loan if you leave early?
- Are hurdles measured on assets, revenue or both, and over what period?
- What are the non-solicit and client-ownership terms?
We're not attorneys and this isn't legal advice. Have a qualified attorney review any agreement before you sign.