How Much Are My Benefits Worth?

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Your salary is the most obvious measure of how much your employer values your work, and it's typically what prospective employees look at first in deciding whether to seek a particular job. Yet benefits now make up an increasingly large proportion of the total compensation that workers receive, and businesses have to look carefully at the cost and value of benefits in order to make sure they attract the best job candidates. By understanding how much your benefits are worth, you can make a true apples-to-apples comparison between jobs and make more informed decisions in your career path. In particular, the following benefits are common and can add considerable value to your compensation package.

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1. Time off

Getting paid not to be at work is just about the best benefit anyone can get. The U.S. is notorious for being stingy with paid vacation and other time off, but most employers still offer at least some benefits in the form of paid holidays, vacation, personal days, or sick leave. In addition, some jobs require breaks during the day, and some employers pay for that time.

2. Government benefits

Most workers realize that the money that's withheld from their paychecks goes toward providing them with benefits under Social Security and Medicare, many of which won't kick in until they reach retirement age. But employers also pay into other government programs, including workers' compensation programs and unemployment insurance. The payments you make are relatively small, but they can provide invaluable benefits when you most need them.

3. Insurance

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Health insurance has become one of the most important benefits that workers can get, and for many employees, the promise of health insurance coverage outweighs whatever salary they receive. In addition to regular medical health insurance, some employers provide a variety of other coverage options, including disability, supplemental health, dental, and life insurance.

4. Retirement

Many employers supplement their employees' retirement savings in one of two ways. First, matching contributions to 401(k) and similar employer retirement plans can help boost workers' retirement account balances. In addition, some employers make profit-sharing contributions directly to retirement plan accounts, regardless of whether the worker participates by making employee contributions. Together, these contributions can add up and grow over time, providing vital income in your post-career years.

5. Miscellaneous benefits

Finally, some employers offer a variety of other fringe benefits. Things like gym memberships, employee parking, transit passes, or even tuition reimbursement can make up considerable portions of compensation for some employees.

Adding it all up

When you combine all of these benefits, you'll often find that they make up a considerable fraction of your total compensation. The following calculator can help you put hard numbers to your employee benefits

Editor's note: The following language is provided by CalcXML, which built the calculator below.

To see how this works, let's start with a basic example. Say you make $39,000 per year, with 10 days of paid vacation, seven holidays, and three personal days. Your employer pays 1% for workers' compensation and $500 per year for unemployment insurance. You get family medical coverage for which you pay $250 per month to cover your 20% share, with your employer paying the other 80%. Your employer pays 3% profit sharing into your 401(k) and matches another 3% of your contributions.

When you run the numbers through the calculator, you'll find that the value of your benefits adds close to half of your salary to the total compensation you receive. The time off you get is worth about $4,000, while contributions to Social Security, Medicare, workers' comp, and unemployment add almost $4,000 more. Health insurance is the big boost, adding $12,000 to your total package, and retirement contributions kick in another $2,340. In the end, the total increase is more than $18,000.

Take all your pay into account

Before you look to jump into a new job just because the salary is better, make sure that you take a close look at the value of the other benefits you receive from your current position. In some cases, it makes sense to keep what looks like a lower amount of up-front pay in your paycheck, because your total compensation ends up being higher when you take benefits into account.

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