A Six-Figure Salary as a Nonprofit Leader IS Possible: Here’s How
Earning a six-figure salary is too often seen as something reserved for the business sector. But I’m here to tell you that nonprofit leaders deserve six-figure salaries too. And it is definitely possible to achieve this benchmark.
Let’s take a look at what it takes to get a six-figure salary as a nonprofit leader.
What Does a Six-Figure Salary Mean?
Making six figures means earning a gross income (before taxes) of $100,000 or more. The term “six figures” means how many digits there are in your income. Earning $99,999 is technically a five-figure income. Earning $1,000,000 or more is a seven-figure salary.
The average income for a US adult is between $56K and $66K, with men earning more on average than women. The average income for a US adult in the nonprofit sector is $44k to $67K. Clearly, nonprofit employees make less, which is not a surprise.
But there is nothing inherent in nonprofit service that requires lower pay for executives, managers, or even entry-level staff.
The nonprofit sector has a lot to offer employees, and because salary comes from donations and grants (mostly), nonprofits want to signal that those donations are valued and put to good use. This leads to paying for programs more than salary.
As a lifelong advocate for the nonprofit sector and its people, my goal is to raise wages and job security. We must break the poverty mindset that keeps nonprofit leaders broke and burned out.
“As a lifelong advocate for the nonprofit sector and its people, my goal is to raise wages and job security. We must break the poverty mindset that keeps nonprofit leaders broke and burned out. ”
How Common Is a Six-Figure Salary in Nonprofits?
Nonprofit leaders can earn a six-figure salary, and tens of thousands of them do. The IRS does frown on excessive compensation for nonprofit leaders, but each organization can determine what that means with its board and legal counsel.
Most colleges, universities, and hospitals are technically nonprofit organizations. Heck, even the NFL was a nonprofit for a long time, and it paid executives millions.
In the private sector, six-figure salaries are very common, and there is no squeamishness about rewarding success and revenue with higher compensation. The nonprofit sector is less transactional.
Bonuses are far less common than raises in the nonprofit sector. Plus, there is no way to compensate nonprofit boards or staff with stock or shares in the nonprofits. Nonprofits don’t have owners or shares of stock. This limits compensation to wages and salary, and reimbursements don’t count toward salary.
“Bonuses are far less common than raises in the nonprofit sector.”
Anecdote: My first 6-figure job was as an Executive Director was running Amplify US, a polling organization that helped nonprofits with messaging. Our budget for the startup nonprofit was only $150k for the first year, and my salary was $120k. Yep, you read that right.
Startups of any kind have much higher overhead because they are making initial investments to grow the organization. I told the board that I needed $120,000—a six-figure salary—to serve as their first executive director.
I also said that, if they raised the first $150K, I would raise the rest and grow the organization. Then the percentage of revenue going toward my salary would nosedive. They never raised all the money, and I wasn’t able to finish the first year.
It was a road bump in my career, but one that many entrepreneurial leaders face. I share the story to let you know my career hasn’t been a complete set of successes.
My second six-figure salary was running the Tyler Clementi Foundation at a finishing salary of $120,000. Then I was tapped to run the Climate Advocacy Lab at $175,000 in 2018.
By the time I left in 2022, I was making $198,000. We were under $3 million for our overall operating budget, but the expectations for salary at this nonprofit started on the higher end because we were created by a foundation.
Many of my clients make a six-figure salary. I have had some clients making over $300,000 as nonprofit executive leaders. Many of my clients increase their salary and employment protections because of our work together. If you’re interested in these sorts of results, you can check out my coaching programs for nonprofit leaders.
I don’t share any of these details for people to feel bad (or good) about where they are on the salary range. But I do want everyone in the nonprofit sector to be paid fairly and generally better than they are today!
Paths to a Six-Figure Salary: New Job vs Current Job
In my own career and with the nonprofit leaders that I coach, I’ve seen folks negotiate six-figure salaries by changing jobs (e.g., becoming executive directors at a new nonprofit) and while staying with their current employers (e.g., renegotiating their salary at an organization they love).
You don’t have to wait until your annual review to ask for a raise. That pattern may be common, but it isn’t legally required and probably not set in stone in your employment manual.
There are two main factors influencing compensation philosophy at nonprofits: values and assets/revenue.
The budget passed by a nonprofit reflects what it values. If the organization thinks people should work for peanuts, it will show in the organization’s budget, culture, and hiring and compensation practices.
If a non-profit has a compensation philosophy that values college degrees more than experience, it will show in the compensation practices.
“The budget passed by a nonprofit reflects what it values. If the organization thinks people should work for peanuts, it will show in the organization’s budget, culture, and hiring and compensation practices. ”
The organization’s revenue or assets (such as having an endowment) also affect its willingness to pay more for staff salaries. This means that one of the critical keys to making more money is raising more money. If you raise an extra $100K, you can pay people better.
Don’t be tempted to put that extra $100K only into extra hard costs for programs.
Nonprofit leaders, boards, and donors must stop thinking that every possible penny needs to be spent directly on the programs. People run the programs!
“Nonprofit leaders, boards, and donors must stop thinking that every possible penny needs to be spent directly on the programs. People run the programs!”
Negotiating a Six-Figure Salary at Your Current Nonprofit
Here are some practical steps for employees looking for more money, whether you are asking your boss or your board:
Know your value. Take stock of your skills, education, training, experience, and the value you deliver to your employer
Use data. Gather data on what people like you make in your role, in your sector, in your geographic region, and in your career phase. Also talk to other similarly situated people (within your organization and at other similar organizations) about their salaries and situations.
Market yourself. Market yourself with your resume, bio, and LinkedIn profile. Consider hiring a professional resume writer. They can boost your self-image and your asking price a lot.
Get specific. Set your target compensation amount, and make your case for it using all the prior steps.
Practice and role play. Imagine a range of responses from your board or boss, and be prepared to stand your ground, even if you don’t get the target amount.
When negotiating for a six-figure salary, the most important thing is to demonstrate your value, the problems you solve for the organization, and how precious and unique your set of skills and experiences is. Have you raised lots of money?
Are you a magnet for important leaders to get involved in your organization? Can you demonstrate how your specific effort, abilities, and network have helped the organization to thrive? Mention it.
Data is also your friend. Even if you are asking for a salary at the higher range among your similarly situated peers, persuasion is key, and data is persuasive. Get salary data from your sector and region.
Look beyond the raw data to find patterns. Is your nonprofit or sector an old boys' club? Are family members on staff paid higher regardless of their effectiveness? Are there patterns occurring that are holding back your salary? Is the lack of data and openness about salaries at the organization part of the problem?
When you make your case for a six-figure salary, you don’t want it to sound like an ultimatum. You want to invite decision-makers on a journey of keeping you with the organization and continuing to produce value for your stakeholders.
Negotiating a Six-Figure Salary for a Job at a New Nonprofit
If you are hoping to get a six-figure salary as someone new to an organization, you will need to be equally prepared.
The minute a job offer is extended, your window for negotiation shortens dramatically since most offers for a job expire within a week or even less.
Tips for what to do in advance to get a six-figure salary job offer…
Make sure your resume is solid and shows why a six-figure offer is a no-brainer.
Make sure you hand-select your references to be cheerleaders for you. You should coach your references on how you hope they’ll show up for you. They need to be unapologetically enthusiastic. When asked about your “areas for growth” by the future employer, they need to have a great answer that doesn’t sink the offer.
Make sure your LinkedIn profile is oozing with recommendations and accolades from others. Don’t start one month before your job search. Go solicit those endorsements now. Recruiters notice these things.
Practice your pitch. Practice asking for what you want. Anticipate four or five ways the employer could respond and how you’ll respond to each of those responses. Role-play with a trusted executive who is a friend or career coach.
Stand in your value and power. The swagger and confidence can really make a difference. I cannot stress enough that confidence and successful persuasion are a huge part of succeeding when asking for a six-figure salary.
The Art of Successful Salary Negotiation at Nonprofits
Negotiation is about shared interests, not splitting the difference. This is one of the critical mistakes people make. People think, “He’ll offer $100k and I’ll counter with $110K and then we’ll end up in the middle.” This is an old, outdated, and losing strategy.
Think about the end game, not just the numbers, by focusing on shared interests. Decades ago, “interest-based bargaining” began to replace older forms of negotiation in labor negotiations, diplomacy, and legal wrangling. Start with what will make both parties happy and work toward that.
Maybe you don’t get $2K more in salary, but you get to work from home, which saves you money on fuel, fast food, and other wear and tear on your car. This strategy comes from the best-selling 1981 book, “Getting to Yes,” which I’ve heard is required reading in some law schools.
Here’s one example of interest-based bargaining. Decades ago, the Iraqi government was arguing with farmers about taking their land. The farmers wouldn’t budge from their land even though they knew it no longer belonged to them. Instead of drawing a hard line, they found shared interests.
It turned out the farmers wouldn’t leave because they wanted one more harvest. The Iraqi government didn’t actually need to develop the land for a year. They found shared interests by allowing the farmers one more harvest season.
This is interest-based bargaining. Use it to get what you want in salary negotiations and in life.
Resources for Landing Your Six-Figure Nonprofit Salary
As an executive coach, one of the most important things I help people with is transformation. This means being better leaders, getting better legal protections, and getting better pay. The nonprofit sector needs to change its ways, and coaches like me are hoping to lead the way.
I’ve helped many nonprofit leaders prepare for executive-level interviews and position themselves for six-figure salary offers. I know what questions interviewers ask and how to stand out in the search process. Then, I help leaders achieve success in their first year, ensuring a confident and smooth tenure as a leader. Learn about coaching with me today.
