How Much Are Your Benefits Worth?

January 22, 2008 By Debbie Dragon

Would you exchange any of your work benefits for a higher salary?

The answer will probably depend on your personal circumstances, but the question will cause most people to consider how much their benefits are actually worth to them.  Chances are- the benefits you receive from your full time employment are worth more than you think.

100% Value-  Many companies offer benefits packages that represent an additional 100% of value to the average employee’s base salary.  In other words- the cost of the benefits the employee receives is equivalent to the amount they receive in salary.  If you make $40,000 a year and get $40,000 a year in benefits- it gives you a bigger picture of what you actually earn from your employment, doesn’t it?

Pension/healthcare: In some instances, employees will receive a pension and/or health insurance even after they’ve retired.  If this is the case for your place of employment, you are likely receiving more than 100% of your salary in benefits over the long term.

You’ll hear often people comparing their salaries to the national averages for their job industry, or sayign they aren’t being paid enough for their work.  You will probably never hear anyone talking abotu the value of their health insurance, vision coverage, dental insurance, vacation time, sick time, flexible schedules, or paid training benefits!

Benefits are costly for employers.  As employees, it’s a mistake to ignore their dollar value when you are evaluating your compensation package.  Most people think they don’t make enough money- but look beyond your salary because if you didn’t have the benefits you receive from your employment, your salary would be worth a lot less! Paying for your health care, vision, and dental work would eat an even bigger chunk of your salary if you didn’t have benefits- and you wouldn’t receive a dime if you decided to take your annual two-week vacation.

Time off: If you earn $50,000 a year and get 3 weeks (15 days) of vacation, your time off is worth $2,885.  If you also get another 5 days of sick time each year, worth $962, your total time off is almost worth $3,850.

Health Insurance: In 2007, the average annual premium for family coverage was $12,106.  Average employees would pay $3,281 towards that cost- which means the other $8,825 was paid by your employer.

 Not considering dental or vision plans, life insurance, retirement plan contributions or other benefits like discounted or free health clubs and ongoing training opportunities- a $50,000 salary including time off and health benefits is already worth $62,500 if you add in the amount your employer pays for your family insurance plan and your time off.  If you tried to put a dollar amount on the other benefits- you might find that your benefits are worth as much- if not more- what you receive as a salary.

Posted in careers, family, income, insurance, jobs, money

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