Last week I attended a financial workshop hosted by the Young Non-Profits Professionals Network in NYC. While there were several useful tax, budget, and investment tips offered by the panel, the discussion seemed to focus on the unproductive comparison of non-profit and for-profit employees. For-profit employees apparently live the glorious live while non-profit employees are struggling in silence.
When it comes to our financial well being, non-profit employees should keep the following in mind:
- The sector is diverse: When it comes to salary, your income depends on the size of your organization and the specialization required of your job. Additionally benefits may buttress a lower salary.
- Comparisons do not help you get a grasp on your finances: Comparisons in general are just not good. When we try to keep up with people we start behaving irresponsibly. Also, for-profits and non-profits are motivated by different factors when it comes to pay and the truth is that many for-profit employees suffer also from weak benefits, low pay, and, increasingly, job insecurity.
- Income is a weak indicator of financial well being: Income can fluctuate for a variety of reasons and changes in expenses may alter how far your income can go.
- Financial stability has little to do with income and more to do with habits: There was a period of time when I used to envy someone with the latest technology gadgets. Now I wonder how much debt they have racked up trying to keep up with the Joneses. Focus on where your money goes not just how much is coming in.
I agree that it’s not productive to blindly compare nonprofit with for-profit wages. The issue for me is that nonprofits widely have salary policies that are harmful, especially for entry-level positions and employees new to the sector. Most distressing to me is salary information listed on job applications, that usually fall into 3 categories:
- Not listed at all (most common); this makes it difficult for someone to know if the position will support their needs (so why go to the trouble of applying?)
- “Salary commensurate with experience”; salaries should be based upon duties and responsibilities. And while nonprofit staff positions usually require a high degree of flexibility, there should be general parity throughout the organization.
- Asking for salary requirements in the cover letter; if a competent person asks for too much, do you just toss their application? This is especially annoying since many staff positions are part of a restricted budget (grant funded), which means that the salary is already known and planned for.
If you feel like your being mis-paid (or have a curious mind), a good place to start is looking at your organizations 990 (assuming that you can’t get a look at the internal budget and books):
http://foundationcenter.org/findfunders/990finder/
That will tell you the organization’s budget and salary lines (divide the salary line by # of employees for a dirty average), funding sources, as well as your Executive Director’s salary and anyone else paid over $50k a year. If you have friends at other organizations, check out how things are allocated on their 990.
Also, idealist has some great surveys/info on nonprofit salaries:
http://www.idealist.org/en/career/salarysurvey.html
[Reply]
Thanks for posting this! I’d prefer 5 weeks of leave and great health benefits to a higher salary, personally.
Your last point was especially well stated, and http://www.thesimpledollar.com is of the same philosophy.
[Reply]
@Emily: I LOVE thesimpledollar. Trent is an amazing writer and thinker and has certainly helped me get a better picture of what it means to be financially stable. Am I there yet? Well, not quite lol but at least I have a better idea of what to aim for!
Im all about flexible hours, personally
@Ben: RIGHT ON! One of the challenges we should address is making sure non-profits at they very least are transparent about their compensation practices.
[Reply]
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