Wall Street Bonus Schedule 2019: How Nonprofits Benefit
In the first quarter of each year, the financial industry celebrates Wall Street bonus season. That’s when the previous year’s bonuses are paid to Wall Street workers. Depending on the firm, Wall Street bonuses may be paid anytime from late December through the end of February. The 2018 bonus pool, paid in early 2019, was $27.5 billion, which amounted to roughly $153,000 per worker. Although down 9% from the previous year, the Wall Street bonus is twice the average salary of a New York City worker. This year, however, the 2019 Wall Street bonus schedule, based on last year’s performance, is expected to be lower overall. Yet some Wall Street workers will see a slight increase in their bonus.
Some fixed income traders could see 5% less and corporate management could see 10% less. The Wall Street bonus for commercial bankers looks to be about the same. But investment banking advisors and hedge fund managers may see a 5% higher bonus. Let’s explore the impact of these payouts in the 2019 Wall Street bonus schedule and how your organization, and your donors, can benefit from them.
Wall Street Executives Bonuses: Impact of Payouts
Regardless of whether Wall Street bonuses are up or down slightly, a lot of money will flow into New York. The financial sector represents 5% of New York City’s private workforce, according to Moira Boyle, Director of WealthEngine’s Luxury Sales Strategy. “Those large year-end paychecks have a disproportionate effect on the local and regional economy.”
Wall Street bonus time has been described as inciting a type of “March madness” in terms of its exhilaration. Part of that elation is tied to some big spending. “People are going to spend most of that money where they live,” commented New York State Comptroller Thomas DiNapoli in a Newsday.com article. Not only New York City, but Long Island, the northern suburbs and the entire state profit. Wall Street bonuses also contribute a significant amount of tax revenue to the city and state.
The Nonprofit Share of the Wall Street Bonus Market
The question for nonprofits becomes, how will Wall Street bonus recipients spend that money? And even more importantly, how much of their Wall Street bonus may be donated to charitable organizations?
Including salary and bonus, the average compensation of Wall Street workers was $399,000 in 2018. As Boyle pointed out, the more senior executives receive the largest payouts, several times larger than their salary. “That’s enough to finance a high-priced investment,” she said. “Approximately 177,000 individuals will be buying real estate, cars, watches, bags, trips, and donating to their favorite charity.”
If you’re a nonprofit, this is your opportunity to get a share of that Wall Street bonus spending. ”We know from human nature that their attention will gravitate to what caught their attention most recently,” said Boyle, “so marketing and visibility are key. Charities should also take note of the time of year—this is a time when a major gift campaign can have a large impact on an organization.”
Getting Donors to Respond Positively
When it comes to major donor fundraising, you want to be able to pinpoint which potential donors are worth pursuing and build relationships with them. Your existing donor data is your starting point. Here are some questions that can help you target Wall Street bonus donors:
1. Who are your current donors?
Use your donor data to create profiles. Conduct a wealth screening. Screenings will help you determine key attributes, like income, lifestyle and interests. In doing so, you can identify common traits, along with each type of individual’s tendency and ability to donate. Build statistical wealth models of your best donors. You can segment top prospects and create personalized offers.
2. What type of donor fits the Wall Street bonus category?
To bring in new donors, you have to know as much about them as you can. Once you know what your major donors look like, you will gain a clearer picture of whom to target. WealthEngine data, combined with your database, can help determine who would most likely contribute to your organization.
3. How do they prefer to communicate?
How are you engaging your donors, based on what you know about their donation influencers? To encourage a positive response, always consider donor communication preferences. Then send your donors and prospects personalized messages that highlight their interests and align with their values.
4. Are you following up and keeping in touch?
Thank donors for their contributions and show them how their gift will be used. Continue communicating with your qualified prospects who have not yet donated. And keep in mind the “quality over quantity” motto. Besides standard donations, some donors may make choose to make a legacy gift through a will.
A Look At Millennial Wealth
Download WealthEngine and Coldwell Banker’s A Look at Wealth 2019 to understand the motivations, behaviors, and trends of millennial millionaires.
Understanding your current donors will help you determine who are your best prospects and how to engage them. The above steps are more complex, but have been simplified here. WealthEngine can assist your organization in targeting the most likely Wall Street bonus donors. Then it’s up to you to keep them donating.