This is a slightly dumb question, but where does the bonus pool money come from? I understand fees essentially pay salaries and keep the lights on, but where does the bonus pool itself come from? This has me curious because my bonus has basically been my target bonus laid out when I signed on for 4 years now, regardless of the market and activity. Work at an institutional asset manager so not a developer.
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You might get a different answer for brokerage, but the firm earmarks a certain amount for Salaries & Wages from the fee revenue generated, which includes any stipulated bonuses. The ability to participate in any upside beyond the "target" bonus depends on a few factor, but dominantly it's how much do the people with decision-making power like you and could they live without you/easily replace you (which goes back to if they like you). If you work for a rainmaker/rockstar person or team who brings in ton of revenue, the company is more likely to pay out beyond the targeted bonus if your boss pushes the issue. But if you've been there for 4 years and not really giving them a reason to exceed your bonus, then they are not likely to do so.
Thanks for the color. Things are pretty standardized where I am up until VP. All analysts and associates basically make the same as their cohort.
Anatomically it would come from either asset management fees or property dispositions.
Are you saying that your bonus has been fixed for four years, or that the firm has always been able to hit their projected number that they gave you at your year end review when setting expectations for the upcoming year?
I’m saying that when I signed on they said target bonus was 60-70%… and it’s been 70% without fail every year. There will be a new % bracket at VP, in which I’ll assume it’ll fall in that bracket as well
Assuming your base isn’t something like $40k, I’d take a consistent 70% all day.
At a shop like yours, bonuses I garauntee you are almost always factored in with 100% probability on the analyst / associate level, if you're talking about 10-15% bonus ranges.
sometimes there is a trigger point on company profitability that will further increase or decrease the bonus.
Its really shop dependent, but for analyst/associate its almost always the $ comes from same pool as salaries because its not a significant % of salary.
Closer to 70%
That’s a very strong bonus target for asset management. I thought it would’ve been more in the 20-30% range at an analyst to associate role.
Is this principal side AM?
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