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Six and a half million dollars bonus

March 16, 2009 in Politics

Yes, you guessed it. Some of the bonus for AIG top executives for last year’s stellar performance. And note, that this is just the bonus.

I made a quick calculation on this. What about if this was the full year’s salary, and not just the cream on top? What if you were to hire this person out as a consultant, since the person i question has to be absolutely brilliant to deserve such a salary?

Long time ago I learned a very rough rule-of-thumb for how much you had to charge a client for a consultant. The rule was that you would have to charge about 3 times the salary you paid to cover for all the other costs involved (including the risk of having them sitting on the bench).

So how much is $6,500,000 really if you start to break it down? Well it’s $125,000 per week, or $25,000 per day if you assume a 5 hour work week. If you then assume 8 hour work days we get to $3,125 per hour.  So to hire a person earning that amount of money as a consultant would require you to pay roughly $10,000 per hour.

If you need somebody I’m available…

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