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Beyond Your Salary
It’s a good idea to consider the benefits that are offered in addition to your salary when you are considering which job to take because job benefits can add a lot to your net income in a variety of ways. In this article, we’ll discuss some of the common job benefits that are offered in the workplace today. Some you will be familiar with and some you may not. There’s a great benefits calculator on http://www.salary.com, which will help you ascertain how much certain benefits are worth. This can be a big factor in helping you decide which job to take.
Insurance
Insurance, especially health insurance is probably the most sought after benefit in any benefit package. That’s because it costs so much money to buy health insurance on your own if you don’t work for a company that offers it at the group rate. Also bundled in with many health insurance plans is dental insurance and vision insurance, which helps pay for glasses. The great thing about group medical insurance is that you don’t have to have a medical examination or answer medical questions, in most cases. When you obtain health insurance on your own, you often have to do one or the other, and you may be denied for certain health conditions.
Cafeteria Plans
Cafeteria plans encompass three different types of job benefits for employees. Not all companies that offer cafeteria plans offer all three parts so check with your employer to see which, if any of the section 125 cafeteria plans are offered. We’ll briefly explore what each part is and how you can benefit. The first part is called a Premium Only Plan, or POP. Under this part of the cafeteria plan, employees are able to pay for their share of insurance premiums using pre-tax dollars, and once this is set up, they won’t have to bother with it again, but the benefit is that less of their money is subject to taxation so more of it can be taken home.
Probably the most popular kind of cafeteria plan is the Flexible Spending Account, and there are two variations of these. While they both work the same, they are designed to pay for different things. One type of flexible spending account is for medical expenses that insurance doesn’t cover like co-pays, prescription drugs, and over the counter drugs. The other type of flexible spending account is used to pay for dependent care expenses such as childcare or long term care for elderly parents.
The way in which flexible spending accounts work is that at the beginning of the plan year, you, the employee decides how much of your salary you want to set aside in the account to pay for these expenses. This money that is set aside is set aside from pre-tax dollars, which could translate into a huge benefit for employees who spend thousands of dollars a year on either dependent care or unreimbursed medical expenses. There might be a cap, but the important thing to know is that you either have to use it or lose it. You will want to estimate how much you spend for certain expenses over the course of a year and budget accordingly, so you will spend as much of the money in your account as possible without losing any of it. In addition, you will pay for these expenses up front and then submit a form to your benefits administrator, so you can be reimbursed from your flexible spending account. To learn more about cafeteria plans, read the article from entrepreneur.com at http://www.entrepreneur.com/humanresources/
compensationandbenefits/article79978.html. This article easily explains all about cafeteria plans in layman’s terms.
Tuition Reimbursement
Many companies offer tuition reimbursement as an added job benefit. This allows students who might not otherwise afford to go to college to pursue or finish a degree. Most companies have strict policies regarding tuition reimbursement, and usually, you must study something that is in the same field as the company you are working for. For example, if you had a job in the finance industry, it is likely they would not reimburse you for pursuing a degree in music or the arts.
In addition, you must pass your classes to be reimbursed, and some companies have a graduated scale of reimbursement. For example, if you receive an A in your class or classes, you would be reimbursed 100% of the money you paid for tuition, a B would be reimbursed at 75%, and a C would be reimbursed at 50%. Not all companies that offer this job benefit have a scale like this, but the ones that do provide an excellent incentive for student employees to do well in their studies. Be aware, too, that this reimbursement is only for out-of-pocket expenses. Students who receive loans or grants would not be eligible for tuition reimbursement unless they still had to use their own money to pay for tuition.
Death Benefits
Not all companies have this benefit either, but it really helps when you have this benefit in your benefits package. It may also be called funeral leave or funeral benefits. This job benefit pays you to be off work in the event that someone in your immediate family dies. Typically, it is about 3 days, but some companies will pay you for 5 days if you have to travel out of town. Some companies require that you produce an obituary, and some want the name of the funeral home and other details. Also, different companies may vary on what they call “immediate family,” so do be aware of that.
Job benefits can add a lot of money to your net salary when you stop to add up the various items you would have to pay for yourself if you didn’t have the benefits. In some cases, it is actually worth it to take a job with a smaller salary if you get salary plus benefits versus a job with no benefits at all and a larger salary. Just medical expenses alone could drastically reduce the net amount of your income when you don’t have insurance, so do consider the jobs that offer salary plus benefits carefully.
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