When searching for a job, it is tempting to focus solely on salary, even though it may not always be the best strategy. A job's benefits package can increase its overall value considerably, potentially making it more valuable than an offer with a larger salary attached. The following are some ways an employee benefits package counts towards total compensation and potentially boosts your compensation by as much as $8,000.
Health Insurance
Any amount that your employer pays toward your health care premium is technically a net gain. A 2009 study conducted by the Bureau of Labor statistics reports that companies paid 82 percent of the insurance premium for single employees and 73 percent for their family members. This amounts to a total payout of roughly $3,800 per year for families and $8,800 for singles.
Many companies offer health care cafeteria plans that include benefits such as health savings accounts, term life insurance and dependent care assistance. These plans allow you to customize your benefits package, making it less confusing, more affordable and a better fit for your lifestyle. Cafeteria plans reduce your out-of-pocket health care costs, potentially saving you thousands each year.
Retirement Benefits
Successful retirement planning requires accruing as much in cash and other assets as you can as early as possible. For this reason, choosing a job with a strong retirement program as part of its benefits package is especially important early on in your career. At any point in your career, a job that does not include retirement benefits may not be worth considering unless it comes with an especially generous salary that you can use to save for the future.
If possible, opt for a defined-benefits plan. With a defined-benefits plan, your retirement investment is not subject to market fluctuations because your employer absorbs all market risk. This means that even if the company folds, your retirement money is safe.
Lifestyle Benefits
Compensation sometimes comes in the form of lifestyle accommodations that can reduce stress, improve the quality of your life and help you achieve a better work-family balance. These benefits include paid time off, napping and other perks. Such benefits can be especially valuable if you have children, suffer from stress or need to take frequent time off for health concerns. Lifestyle benefits mean different things to different people and may account for a large percentage of a job's overall value depending on personal preferences and needs.
Total compensation goes far beyond salary. Depending on your lifestyle, retirement goals and family needs, compensation in the form of an employee benefits package can be just as important. Before accepting a position, request a copy of the employer's summary plan description (SPD). Review it thoroughly for a clearer understanding of its benefits package and how it fits in to your compensation needs. At the very least, you should consider taking advantage of the benefits offered by the Affordable Care Act. Despite whether you think it matters or not, now's the time to check out Healthcare.gov and enroll for health insurance if you don't have it.
(Photo courtesy of stockimages / freedigitalphotos.net)
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