Domestic Lump Sums as a Relocation Benefit

    Apr 29, 2020 @ 10:15 AM / by Christopher Bloedel

    Lump Sum Calc

    What are the benefits of using domestic lump sums?

    What is the best solution for your company: full-service relocation, lump sum amount, or a hybrid approach? It’s a hotly debated topic within corporate relocation programs and is discussed at almost every industry event. Companies must weigh their budget against the level of support they are willing to provide transferees. There’s no easy answer, no one-size-fits-all.

    Part of a domestic relocation program

    Sometimes companies maintain multiple types of programs. Lump sums can be utilized for intern or entry-level employees while reserving full-service benefits for middle and senior management moves. Including different types of policies can address the true needs of the transferee population while also effectively managing the costs.

    Elements included

    The lump sum can include many different items that are key to a relocation: home finding, temporary living, final move, and miscellaneous expenses to name a few. The intent is that the funds provided will cover the typical and reasonable expenses a transferee will need to successfully navigate their move.

    Establishing amounts

    A flat amount? An amount based on previous actuals? A geographically sensitive calculation? Which is best?

    While a flat amount is very easy to maintain and implement, it can quickly become out-of-date. If you have moves across the country, it is difficult to defend that $3,000 or $5,000 is enough. Previous actuals can help determine the amount. This is a relatively easy approach but might not accurately predict your program’s future needs. Geographically sensitive amounts can provide precise, accurate data and can be sourced from a data provider. Again, there is no ‘right’ answer amidst these many shades of grey.

    Managed or not?

    Everyone wants to do it themselves…until they don’t. This may sound like a Mark Twain quote, but it’s commonplace in the world of lump sums. Carefully balancing simplicity with support can lead to a successful lump sum program. There are many vendors in the relocation industry that can provide counseling to transferees as they navigate their move and decide on how to spend their funds. It’s not a ‘full service’ move but can provide much needed support.


    Need help with domestic lump sums?

    Reach out today to discuss how we can help design a lump sum program to supplement your relocation strategy. You can reach me directly here or contact our client engagement team by clicking below now:

    Let's talk

    Global Mobility PlaybookDownload now to optimize in 2020!

    2020 Global Mobility Playbook [Download]

    people crowd walking on busy street on daytimeTrending article:

    Are you getting the most out of your Global Mobility Network?

    2020 Business Traveler Benchmark ReportTrending download:

    The 2020 International Business Travelers Benchmark Report [Download]

    2019 Long-Term Assignment Benchmark Report [Download]

    2019 LTA Image edited

    The 2019 LTA Benchmark Report provides a comprehensive overview of policies and practices for temporary long-term international assignments. 


    Topics: Housing, On-site Insight, Expatriate Housing, Insights and Experience, Salary Evaluation Tool, International Housing Guide, Domestic Mobility Programs, lump sums, Site Summaries, Domestic Moves, Domestic Lump Sum

    Christopher Bloedel

    Written by Christopher Bloedel

    Christopher rejoined AIRINC in June 2019 (he previously was with the company from 2011 to 2014) as a Relationship Manager and is responsible for engaging and consulting with clients regarding global compensation issues. Prior to AIRINC, he worked for over 20 years in the mobility industry with consulting and relocation management companies in various research, account management, and business development roles. His experience includes mobility policy review and consultation for various Fortune 500 companies as well as active roles in national and regional mobility groups such as Worldwide ERC and the Midwest Relocation Council. He has a Bachelor's Degree in Economics from the University of Wisconsin, Parkside and works out of his home office in Wisconsin.