Congratulations on receiving job offers! Comparing salaries isn’t just about the biggest number. Many non-salary factors significantly impact a compensation package’s true value. Before accepting an offer, learn How To Compare Salary Packages holistically by considering these key elements.
Health Insurance Premiums
Most large companies (50+ full-time employees) must offer health insurance. Many smaller ones do too. Employers and employees typically share monthly premium costs. However, the employer’s contribution percentage can drastically affect your finances. One company might cover 90% of your premium, while another covers only 50%, even for the same plan. This difference can amount to thousands of dollars annually.
Actionable Tip: Request detailed health insurance information and rates to estimate out-of-pocket costs. If you’re covered by a parent or spouse, this may be less critical.
Retirement Benefits
Start planning for retirement early! A 401k, a common employer-sponsored retirement account, lets you contribute pre-tax dollars (up to $22,500 in 2023). Some employers offer a “match,” contributing a percentage of your salary to your 401k based on your contributions. For example, a 6% match on a $100,000 salary with a 10% employee contribution adds $6,000 to your retirement savings annually. This is essentially free money!
Actionable Tip: Inquire about 401k match programs, vesting periods, and any waiting periods before eligibility.
Bonuses and Commissions
Roles in sales, finance, and consulting often include bonuses or commissions. Sales representatives might earn a percentage of each sale, while investment bankers often receive substantial bonuses. Understand how these structures work and ask about typical amounts for your position.
Actionable Tip: Ask about the structure and average payout for bonuses and commissions for similar roles.
Additional Perks
Consider perks like free lunches, wellness stipends, tuition assistance, and vacation time. Quantify their financial value based on your usage. A lower salary with valuable perks might outweigh a higher base pay.
Actionable Tip: Evaluate which perks you’d use and calculate their monetary value to you.
Relocation Assistance
Moving for a new job can be costly. Some companies offer relocation packages covering expenses like packing, movers, transportation, and temporary housing. Factor this assistance into your decision, especially for expensive cities.
Actionable Tip: Calculate moving costs and compare them to any offered relocation allowance.
Cost of Living
Compare living costs between cities using online calculators. A lower salary in a more affordable city might provide a better quality of life than a higher salary in an expensive area. Factor in expenses like housing, transportation, and groceries.
Actionable Tip: Use a cost of living calculator to compare expenses in different locations.
Conclusion
Ultimately, prioritize the benefits most important to you. A lower base salary with valuable benefits might be more attractive than a higher salary alone. Thoroughly analyze each offer’s components to make an informed decision. Don’t hesitate to ask clarifying questions before accepting. Good luck!
