Whether you are starting your first job or looking for a new one, it is very important to consider the benefits that each company offers. You should add the benefits into your salary consideration, because you may be surprised that a lower paying job with great benefits can put you financially ahead when compared to a higher paying job. Here are the most common benefits and things you should consider about them as you consider your new job. Taking advantage of your benefits can reduce your taxable income and add additional savings.
The most common benefit is health insurance. Many companies have different policies about when you qualify for health insurance. Generally if you are working full-time you qualify for this benefit. Some companies will completely cover you, and allow you to purchase insurance for your family. Other companies will have you pay a premium for yourself and your family. Some companies allow you to cover your significant other as well. You should consider the out-of-pocket costs as well the premium costs when comparing health insurance benefits.
Employer match is another great benefit. Many employers will match your 401K contributions up to a certain percentage of your salary. This is something that you should take advantage of because it increase your earning and savings potential. If you live the company before you are vested in the 401K program you will lose the amount your employer put in. Generally it takes five years to become vested.
3. Paid Vacation and Sick Time
Paid vacation and sick days are another great benefit. Generally you earn a set number for each month you work. These days will accrue as you work. Many employers also give additional days once reach the five or ten year mark. When changing jobs you may want to consider the things that you will give up when it comes to seniority. Additionally when you leave, your company should pay you for the sick days and vacation days that you have accrued, but not used.
Life insurance is another common benefit. Generally your employer will pay for the amount of one year's salary, while giving you the option to purchase additional coverage. This is a great benefit, and can help your loved ones pay for burial expenses in the event of your death. You should be prepared to name a beneficiary when you fill out your initial paperwork. This does require a social security number for the person you are leaving the money to. You can also change the beneficiary by contacting your human resources department.
Your employer may offer stock options as well. Stock options allow you to purchase stock at a set price. There is a waiting period set by the company that puts a waiting period on when you can sell the stock. Generally you receive the stock options a lower price, and then sell them when they are higher.
Another common benefit is a flexible spending account. These are regulated by the government, and so the rules are pretty much the same across the board. A flexible spending account will allow you to set aside pretax dollars to pay for medical and daycare expenses. Flexible spending accounts are a great way to decrease your taxable income, you should take advantage of one if you can.
7. Other Insurance Options
Your company may offer many other insurance options. These may include dental, vision, and disability insurance. You should determine whether or not you need all of these additional insurance benefits. Disability insurance is a great benefit, since it will protect if you were suddenly injured. If you are considering dental and vision insurance you should carefully look at your insurance plans before you make a decision.