Now that you’ve gotten the job offer, it’s time to review the employee benefits.
If you’re on the hunt for a new job, there’s more to consider than just your responsibilities in your new position. In fact, one of the biggest things to consider when job hunting is your new employer’s benefits packages.
According to the Bureau of Labor Statistics, 74% of civilian workers had access to workplace healthcare benefits.1 In the private sector, 70% had access to healthcare benefits and in the government sector, access to healthcare benefits were available to 89% of workers.2 Because of this, understanding employee benefits is a must—especially when you’re considering a new job offer.
5 Types of Employee Benefits
1. Health Insurance
For many job seekers, health insurance can make or break a job offer. Many start-ups or smaller companies don’t always offer health benefits. If they do, you’ll probably see PPO (preferred provider organization), HMO (health maintenance organization) plans, or HDHP (high deductible health plans).
PPO plans are flexible and allow you to see any healthcare provider. In addition, PPO plans do not require you to choose a primary healthcare provider and referrals are not required.3 HMO plans are less expensive but only allow you to see certain providers in your local network. HDHP plans are popular because you have the option to open up a health savings account (HSA). These accounts allow you to pay for medical services with tax-free money.
2. Retirement Plans
Thanks to the SECURE Act 2.0, saving for retirement just got a little easier. Companies are more able to offer things like student loan help, retirement benefits, and more. See our recent article on SECURE Act 2.0 to see what changed.
But when it comes to retirement plans, most companies these days opt for a 401k over a pension plan. The most common benefit you’ll see is a 401k savings option with a company match up to 3%. That means your company will match whatever amount you put into that account up to 3%. It may not sound like a lot, but when it comes to retirement, every little bit counts!
3. Flexible Spending Accounts
Flexible spending accounts (FSA) are often associated with high deductible health plans (HDHP). When you have a high deductible health plan, an account like an FSA or HSA (health savings account) can really help offset medical costs. With an FSA or HSA, you determine how much goes into the account from each paycheck through direct deposit. Plus, it’s tax-free earnings which means you’re saving even more from your paychecks to go toward things like: medicine, eyecare, doctor’s appointments, and more.
4. Paid Time Off
For many employees with traditional employee benefits, PTO is a big deal. American companies usually start employees with two weeks paid vacation and add more PTO benefits the longer you serve the company. Depending on the company, you might also be offered sick leave or personal days as well.
Lately, the workforce is moving toward an unlimited PTO model where the vacation time isn’t capped but rather on the honor system.
5. Stock Options
Stock options are a benefit that most start-ups like to offer their employees that join at the ground floor. Usually, these small companies are unable to offer much in the way of benefits, but they can offer stock in the company. As the company becomes more profitable, you do too.
How to Choose The Best Plan
Understanding employee benefits can feel overwhelming at times . . . but it doesn’t have to be. Ask a SageSpring Wealth Partner for help. We can help you understand your options for health insurance, life insurance, stock options, and retirement benefits so you can choose the best plan for you and your family.
