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The 411 on
Relocation Packages

(Everything you need to know, and maybe even more than you bargained for.)

Currently offering relo packages? Not yet, but it’s on your radar? Either way, you’ll want to consider how to overcome the effects of COVID-19 on relocation. You can’t offer a competitive, yet cost-efficient relocation package without understanding industry standards, trends and best practices.

As businesses continue to pivot and engage new strategies for recovery, having the right talent in the right place—at the right time!—has become essential to staying competitive and achieving new goals.

Since most companies are operating with leaner budgets, reducing and controlling relocation expenses has become a high priority. This is particularly true for those relying on traditional—aka costly—Relocation Management Companies (RMCs) to administer their programs.  

The Basics:

What’s a Relocation Assistance Package, Exactly?  

Let’s get on the same page.  

At UrbanBound, we define a relocation package as an employer-sponsored benefit that’s offered to employees who’ve agreed to move for work, or to prospective new hires as an enticement to accept a job offer that involves relocating to a new city. 

The term “relocation package” is both the specific financial benefits an employee receives to offset the cost of their move and the logistical assistance provided to them. Those financial benefits are often broken down into specific categories, which we’ll address in more detail later.

Relocation assistance packages come in all shapes and sizes. Some employers get detailed, and design tiered, standardized packages dependent upon career level or position, while others tend to be more casual and/or case-specific.

Relocation benefits are a business expense. To stay true to your company’s bottom line, it’s important to be detailed when creating, managing, and negotiating these benefits—not to mention how you track and measure your program’s effectiveness.

Relocation assistance packages aren’t one-size-fits-all. Job type, employee experience, and location all factor into the relocation benefits provided. Best of all—they can be restructured to fit your organizational goals/needs at any time.

After working with employers who move hundreds, if not thousands, of employees per year - we’ve noticed the most successful companies continually reevaluate and restructure their relocation benefits and processes.

Why Offer a Relocation Package?  

Employers offer relocation assistance as a compliment to traditional employee benefits.


Why? There are many reasons, but the most common is to help companies achieve their talent acquisition and expansion goals. 

Healthcare companies, and companies that leverage tech to disrupt an old or outdated industry, have been hit hard by skilled labor shortages. As a result, they’ve had to expand their recruiting efforts geographically. Without an attractive relocation package, securing skilled long-distance talent is a long shot. 

Similarly, if a company is committed to building a competitive internship program, offering modest-but-comprehensive relocation benefits to interns can set an employer apart from the pack.    

There are other reasons, too. Maybe you want to diversify your workforce by hiring internationally, or maybe you’re expanding and opening a branch in a new location. Strong relocation assistance packages give employees an incentive to move. 

Whatever your company’s motivation, here’s one thing to keep in mind—every relocation package you offer is a reflection of your company’s values and culture. No matter how much you spend (or don’t), at the end of the day you want relocating employees to feel taken care of every step of the way.    

What’s Typically Included in a Relocation Package?  

This depends greatly on the employer, job position or title and current benefit packages.   

Most assistance packages typically cover these costs:

  • Traditional Moving Expenses – household goods shipment and auto transport.
  • Travel – the cost of plane tickets or car travel to get an employee—and their family, if applicable—from the old to new location.
  • Home sale and purchase assistance – Think closing costs and/or home-finding trips conducted in advance of the move.
  • Rental-related expenses – Because many employees now choose to rent as opposed to buying homes, rental-related benefits are playing an increasingly important role in relocation packages.
  • More generous relocation packages may also include these benefits:

  • Short-term housing – Maybe an employee’s closing isn’t for another month, or they didn’t have time to find the right apartment. In those cases, short-term housing is a valuable benefit. 
  • Complete packing and unpacking services – This benefit is typical in executive level relocation packages.
  • Job search assistance for a spouse or partner – Also a common feature of executive level relocation packages.
  • Acclimation services – The main reason relocations fail is because employees and/or their families fail to acclimate to their new environment. Providing destination services—introducing the employee to various aspects of their new city, from transportation to slang to the best restaurants—is an excellent return on the employer’s  investment.  
  • Candidate assistance tools – UrbanBound’s Candidate solution boosts job offer acceptance rates by providing tips and area info that improves the interview experience and educates candidates while speeding reimbursement for travel and related expenses.
  • Sometimes, the best relocation benefits are those that offer the most flexibility, allowing employees to pick and choose their benefits. This allows the employee to design a personalized job relocation package based on their needs and lifestyle. 

    Who Gets a Relocation Package? 

    Every employer decides who will qualify for a relocation package.


    Higher level talent like c-suite, directors, etc. have always been the most likely candidates to receive executive relocation assistance. But, more employers are offering relocation packages to attract valued individual contributors. 

    The rise of technology is a perfect example. Tech-forward companies tend to offer very attractive relocation packages to keep pace with expanding hiring needs, and attract fresh, innovative talent that will contribute to their aggressive growth strategies.

    Offering relocation benefits to entry-level hires and interns is also a new trend. Think long-term talent development! 

    So, who gets relocation packages? Basically, whomever the employer wants—and has budget to provide for. 

    In-Depth:

    What Type of Relocation Packages Are There?

    Like everything else, the relocation industry sees various trends come and go.


    One of the advantages of relocation today is that employers can choose from a range of relocation packages and customize them as they see fit. 

    Here’s a rundown of the main types of relocation packages you’ll find most common right now:  

    The Lump Sum Relocation Package 

    Also known as “cash only” plans, the lump sum package is essentially a signing bonus that’s intended to fund relocation expenses. The employer gives the employee a set amount of money, allowing the employee to use it however they choose and keep whatever isn’t spent. 

    The advantage: it’s easy for employers to manage and budget, and, at least initially, employees like the idea. 

    The disadvantages: employees are on their own when it comes to planning their relocations. If they’re trying too hard to pocket some of the money, it can result in a very bumpy relocation. Furthermore, the employer has no way to gauge the status of the move. 

    One way to overcome the disadvantages of lump sum packages is to use relocation technology that gives employees support and direction while planning their move, as well as keep employers in the loop.      

    The Managed Budget Relocation Package 

    The “managed budget,” also known as a “capped allowance” plan, is a variation of lump sum that’s designed to address some of that plan’s disadvantages. 

    Instead of simply handing off funds to the employee, the employer sets a maximum amount they can spend—often accompanied by guidelines on how to use the funds. The employer may provide support to the employee in the form of a relocation consultant and/or relocation technology.

    The big difference? Under managed budget plans, if the employee doesn’t spend their entire allowance, they don’t get what’s left over. It’s use it or lose it!

    The advantage over lump sum packages—more support and flexibility for employees and more control from the employer. These are more cost effective for employers, although not typically preferred by employees. 

    The Core/Flex Relocation Package

    Core/Flex relocation packages balance value with flexibility by providing certain core benefits—like moving costs and portions of real estate transactions—along with a menu of flexible benefits employees can pick and choose from. 

    For example, while some transferees need a service to move their pets, another might opt for extra storage space.

    Employers can create multiple tiers of core benefits with flexible options for employees at different levels, but the basic core/flex structure is the same. Core/Flex plans offer employees the opportunity to customize their relocation to meet their needs. Even better, they offer employers greater cost control.

    The Tiered Relocation Package 

    Tiered relocation packages are ideal for employers that offer relocation benefits to various levels of employees. Three-tiered programs have become the standard. They’re typically organized like this:

  • Tier 1 - the most modest relocation package, geared to interns and entry-level new hires.
  • Tier 2 - a package with more benefits and higher maximums, typically offered to mid-level professionals and valued independent contributors.
  • Tier 3 – the deluxe relocation package, reserved for c-level executives and upper management. 
  • Tiered relocation plans are a cost-effective way to offer competitive relocation packages to all employees. However, this level of customization does require more sophisticated administration—using relocation management technology can be very helpful in managing these packages.    

    The Fully-covered Relocation Package 

    Under a fully-covered relocation plan, usually reserved for higher-level executives, the employer pays the complete cost of the relocation. These types of plans are very expensive to offer, and complex to manage. 

    In addition to comprehensive benefits, most employers also provide personal support to these employees in the form of a relocation management specialist (either an in-house employee or through an RMC). Fully covered relocation packages generally get high satisfaction grades from employees, but they’re costly for employers, as well as hard to manage and predict. 


    What Does an Average Relocation Plan Look Like?

    That depends who you ask.


    The “average” relocation package varies widely from industry to industry and from one employee level to another. It also depends on the type of relocation package—i.e., lump sum vs. core/flex vs. full coverage. 

    The average relocation benefits package—regardless of the specific dollar amounts—will typically include assistance with moving, home selling/rental expenses and transportation to the new location at the least.   

    Looking at stats is a great way to benchmark how much relocations typically cost. Specifically, the average cost to relocate a current employee who owns a home is $97,166, as opposed to $24,216 for renters.The average cost to relocate a new hire who owns a home is $72,627, as opposed to $19,309 for renters. 

    Of course, if you’re using your relocation package as a way to attract and develop talent, you want a relocation package that is clearly better than average!

    How to Structure a Relocation Package

    There are infinite ways to structure an employee relocation package.


    Perhaps the best place to start is by identifying your objective, reviewing your budget, and establishing a core framework of benefits. If you’re starting from scratch, answering these basic questions might give you a helpful starting point: 

    Who will we offer relocation benefits to?
    Relocation assistance to executives would be structured differently than if you’re offering them to employees across all levels.

    How many relocations will we offer per year?
    If you’re only handling a few relocations per year, you may choose to approach them on a case-by-case basis. On the flip, if your  fast-growing company plans to pursue an ever-increasing number of relocations, creating a consistent, standardized program is key.

    What do our competitors offer?
    Relocation assistance packages vary widely by industry, location and employer size. For example, relocating to St. Louis or Minneapolis is very different than relocating to Boston or San Francisco. To craft a competitive package, you’ll also want to incorporate some market research.  

    What type of relocation package(s) do we want to offer?
    Lump sum, managed benefits, core/flex? If you’re looking for guidance, the most competitive relocation packages focus on the employee, offering flexibility and support while providing cost control and analytical tools to employers.     

    Who will administer relocation benefits?
    You have the option of managing your program in-house, or outsourcing it to a relocation management company. If you outsource, you have the option of choosing a traditional RMC or a more modern, relocation technology provider like UrbanBound. .

    What benefits do we want to include?
    Choosing benefits and setting maximums depends on several factors, including what a competitive relocation package looks like in your market, as well as your budget.  

    At the end of the day, you want to offer the most competitive benefits, and the best relocation experience as cost-efficiently as possible. If you don’t have the in-house expertise to accomplish all this, your best bet is to partner with a relocation expert.  

    Crafting an Offer Letter that Highlights Your Relocation Benefits  

    Your candidate’s offer letter is not only a reflection of your corporate culture, but also of your relocation policy.


    Writing a clear, compelling offer letter for employees who will relocate starts with a well-written relocation policy. This policy should be consistent with whatever job offer conversation it accompanies or follows. 

    Content in the letter should include:

  • The employee’s new job title, position and description of duties.
  • The proposed salary, benefits and any bonuses.
  • The new destination, and the name of the employee/candidate’s new manager.
  • The date on which the employee is expected to start.
  • A summary of the offered relocation package, along with key benefits and maximums. (If you’ll be providing a tax gross-up benefit, include that information here.) 
  • Repayment terms, should the employee leave the company within a certain timeframe.
  • The date by which you would like to receive an answer to your offer.
  • Sell your relocation package as a benefit to your employee. Once the employee accepts your offer, you can then provide the complete relocation package information. 

    Relocation Package Negotiation Best Practices for Employers 

    It may be necessary to help you seal the deal.


    If you like a candidate enough to offer them a relocation package, you should be open to some negotiation on the details.

    Bottom line: you want to provide your new hire with competitive relocation benefits, without blowing your relocation budget. When it comes to relocation package negotiation, here are some best practices to consider:  

  • Listen to your new hire’s requests and try to fully understand their needs. 
  • Estimate what their actual relocation costs will be, so you can factor that into your counteroffer. 
  • Be sure to consider the cost of living in the destination city.
  • Establish your maximum offer in advance. In fact, you may wish to establish standard maximums for your relocation program in general and apply them to specific negotiations. Then, if you want to make an exception, be sure you have a good rationale for it. 
  • Be clear and specific during negotiations. During back-and-forth, it’s easy for misunderstandings to occur.
  • The best way to minimize the need for negotiation is to offer a relocation package with built-in flexibility. If employees already have the freedom to use their relocation dollars the way they want, it greatly reduces the need for negotiation in the first place.  

    What’s the Difference Between Traditional and Tech-based RMCs? 

    This is an important question when it comes to controlling relocation management costs and improving the employee relocation experience. 


    When it comes to administering relocation management programs, companies have three options:

  • They can manage their program internally, provided they have the staff, resources and ibuprofen to do it right (most don’t).
  • They can outsource it to legacy RMCs—the expensive, old-school solution. These companies are powered by people, often working with outdated, manual systems and cumbersome administrative processes.    
  • They can partner with an affordable, tech-based RMC like UrbanBound. 
  • Come on, you knew it was coming! 


    Our platform allows employees to plan and book their move online, while offering the support of a dedicated relocation consultant. Our unique solution offers employees more choice in personalizing their relocation, and employers more control and visibility into relocation expenses. 

    The straight goods? 

    UrbanBound saves employers enormous amounts of money—up to 66% per relocation. Most traditional RMCs silently markup multiple aspects of every relocation, including household goods shipments, short-term housing, and even tax gross-ups, adding thousands of dollars to the cost of every relocation. We don’t. 

    At UrbanBound we’re all about saving you money, and taking care of your people.