Remember the last time you were hired for that job you applied for? What were your feelings? Excitement, happiness, then quickly nervousness. Receiving an offer for a new career opportunity can be an exciting event in your life. But, even if a prospective employer promises an attractive salary, other benefits can make a big difference in whether or not you come out ahead financially. To decide if a job switch makes good financial sense, you need to evaluate the full compensation package.
Health and Benefits:
Have you checked out insurance plans on the Health Insurance Exchange, if not, don’t be surprised how bad the options are. Health insurance is one coverage you don’t want to be without. You will most likely have to get coverage through the exchange if your employer doesn’t offer coverage. Before switching jobs it is imperative to check the benefits and see how soon you will be covered through your new employer.
Questions to think about:
- How do the new coverage options compare with your existing plans, and how much would the employer contribute? Now is a good time to review your coverage needs and consider making a change, even if you end up staying with your current employer.
- Other benefits: Does the new company offer subsidized child care or allowances for dependent care? What about tuition reimbursement?
- When would you be eligible for these benefits? Depending on your start date, there may be some lag time between coverage under your old employer and coverage under the new employer.
Before you leave your old job discuss the process for continuing your health care coverage under COBRA with your current company’s HR department. Also be sure to cash in on any unused benefits you can’t take with you, such as fitness reimbursements and company discounts for goods and services. Remember that certain benefits (e.g., tuition reimbursement) may have a repayment requirement.
Paid time off
One of the best perks of any job is paid time off. How does your new job stack up? If you are weighing up offers this could help narrow down your choice.
Questions to think about:
- Will you be gaining or losing time off? How long will it take you to accrue the amount of time off you have now?
- Are all paid days off lumped together or separated into categories (vacation, sick leave, and so on)?
- What is the company’s culture and policy related to life events such as the birth of a child, illness, and bereavement?
Quick Tip: Take note of your accrued vacation time, and keep a written record of the amount you should be compensated for when you leave.
Any often overlooked benefit is the 401(k) match. How does the new company handle matching, if at all.
Before you leave your current job consider how much money you might be leaving on the table if you’re not fully vested in your current employer’s retirement plan. You could try and negotiate for a later start date or some other type of compensation to make up for lost retirement funds.
- Does the company offer a bonus program?
- Is the bonus fixed or variable? What is it based on?
- What were the average payouts over the past couple of years for someone in your position?
- Would you be entitled to a bonus in your first year? Can you expect a prorated payout based on your start date?
- Would the commute add costs or savings compared with your current situation?
- Is working from home a possibility?
When deciding on that new job you should keep an open mind, as well as a firm idea of your priorities. If you decide to accept a new job, you want to be sure that you’re getting more than you’re giving up—both financially and in quality of life.
What important benefits would you not want to give up or have learned you would like to keep if you move jobs?