Navigating the job market is stressful no matter you experience level. But for new grads, there’s an extra layer of complexity added to the process. It’s often difficult for new grads to figure out things such as typical pay for the position they want in the city they want, whether the PTO the company offers is normal or not, and whether having a keg in the office is actually a benefit or more of a distraction. This guide will help break down what’s normal, what’s cool, and what’s just plain useless when it comes to benefits a company is offering.
Health Insurance
This is a big thing that no one really offers much guidance on. There’s no class on what a deductible is and if it’s better to have a high deductible or a copay. Here’s the gist of it:
A deductible is essentially the amount of money you need to spend out of pocket (on doctor’s visits, prescriptions, etc.) in order for your coverage to kick in. For example, if your deductible is $1,500, you need to spend $1,500 to get that 80% bill coverage (or whatever specifics the plan offers). This seems crazy but is often made possible by a health savings account (HSA) or a flexible spending account (FSA). These are accounts you can contribute pre-tax dollars to in order to save up for those visits and prescriptions. Often times, your employer will contribute to your savings plan if you have a high deductible plan.
If your plan has no deductible, you will have a copay. A copay is the amount you pay for each visit, prescription, etc. For example, you might have a $30 copay for primary care physician visits and a $50 copay for specialist visits (think: dermatologist).
Often times, high deductible plans cost less since they require you to spend more out-of-pocket. There is no right or wrong answer when it comes to choosing a plan (especially if you don’t have a choice!) but it’s good to know the different options out there when evaluating a job offer. After all, a benefit like insurance can make or break your budget depending on the details.
Paid Time Off (PTO)
Back in the day, and even at a number of companies now, it was common to have PTO broken down as vacation time, sick time, and personal time. Recently, though, a lot of companies have lumped this together to just create PTO time. Instead of receiving 5 sick days and 10 vacation days, you would just receive 15 PTO days to use as you please. When considering the amount of PTO being offered to you, remember to factor in any paid holidays. If you have 15 PTO days but all of the bank holidays off, you might be getting more time than someone with say, 18 PTO days and just a few holidays off. Also, if working from home is an option at the company, that’s another thing to consider. This allows you to still work when you’re feeling too ill to commute (or you don’t want to spread germs!) meaning you won’t need to burn a PTO day for having a cold. Be careful to really evaluate your situation, though. If you are very ill and won’t be productive, it’s best to just use a day.
Telecommuting
This benefit is becoming much more popular in the workplace with the advancement of technology. See what the company’s telecommuting policy is. Some companies might offer a day or two working from home a week. That means you save money on transportation costs.
Parental Leave
Even if you’re not planning on having kids for a while, this is a big one to look at. A lot of companies offer a little bit of time as parental leave, and mothers can use short-term disability to have time off with their newborn. This means if you’re a dad or an adoptive parent, you will just be allowed that amount of leave dictated (plus any PTO if allowed) to bond with your new child.
Retirement Savings
I know, retirement is like, sooo far away! But think about it, you need all of that time in order to save up enough to live 20-something odd years without working. Check out the company’s 401K matching – if they offer it. It might seem like a boring benefit, but it’s one that can make a major difference in your life down the line. Even if the company’s match seems amazing, check to see how long it takes to be fully vested. This is a fancy way of asking how long you need to be at the company to be able to keep all of that retirement money they gave you. Example, I worked at a company that offered a 6% match, but it took 5 years to be fully vested. Now, I work at a company that offers a 5% match, but I’m fully vested after just 6 months. Meaning, if I were to move on, I could keep all the money they’ve contributed after being an employee for 6 months. No one wants to think about leaving their brand-new job, but it’s still just a good thing to know in case your career takes an unexpected turn.
Stock Options
This is another benefit that might seem boring when you’re 22, but exciting when you’re 35 (or 25). See if your employer offers any sort of discount on company stock if you’re being offered a position at a publicly traded company. They might even cover the fees that are associated with getting in on the stock market. It’s a great way to own some stock at a discounted rate.
Free Food
This is a benefit that is increasingly common at companies today. But, it’s also one you need to be wary of. Some really great companies with really great benefits offer free food – be it snacks or even catered meals – to its employees. Other companies try to distract people (especially younger people) from their less-than-ideal benefits by offering free food. I’m all about catered lunch on Fridays or free snacks in the kitchen, but at the end of the day, these don’t help pay the bills or help set you up for a successful financial future. Just make sure everything else checks out before rejoicing over Taco Tuesdays in the office.
Beer Fridge
Like free food, this is another “benefit” companies are offering more and more. This one can be even trickier than free food if you’re someone who doesn’t drink much or someone who is looking for a more professional environment. This isn’t to say beer fridges in the office can’t be handled responsibly by professional adults. It totally can! But, it can also create an environment that feels more like a Friday Frat Party than an office. This generally isn’t a benefit you need to weigh heavily though – that is, unless the benefits listed above are lackluster. Then it’s important to remember that free beer won’t keep the lights on.
Other Misc. Benefits
These are just a few other benefits you might encounter when receiving an offer – and whether they’re important or just nice to have.
Employee Assistance Plan (EAP) – Important. This is a voluntary program that offers confidential and free assessments, short-term counseling, and referrals for employees experiencing work or personal issues.
Pawternity Leave – Nice to have. Some companies have started offering “pawternity” leave, giving people who adopt new pets some extra time off.
Company Car/Phone – Important. If your position involves traveling a lot or making business calls on the go, these are important benefits. If you’re not offered a company car, check to see if the company reimburses for travel. This includes more than gas, but also wear and tear on your car, insurance, etc. Similarly, if you need to be taking a ton of personal calls on the go, the company might cover part of your cell phone bill.
Company Swag – Nice to have. I mean, who doesn’t love free stuff, right? But again, a free Yeti thermos or a branded t-shirt aren’t going to pay the bills.
Professional Growth/Tuition Reimbursement – Important. See if your company offers money toward professional certificates and courses, related conferences, or even towards furthering your education.
As you can see, there are a number of benefits to consider along with your salary when you receive an offer. Some are exciting, some are important, and some are both! Of course, there are even more benefits out there than listed in this guide, but hopefully this makes understanding each one a little bit easier!
Emily (McKinney) Turner was a Digital Marketing Copywriter at Nexxt, but has since moved on to new adventures. She still keeps tabs on what’s happening at Nexxt and has a full understanding of what a job seeker experiences as they search for their next opportunity.