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Calculate Your Benefits' Worth to Evaluate the Offer

Calculate Your Benefits' Worth to Evaluate the Offer

Peter Vogt | Monster Senior Contributing Writer

November 05, 2009

The best way to put a dollar value on benefits as part of a job offer is to ask the prospective employer to do it for you, says management expert Lonnie Pacelli, author of The Project Management Advisor: 18 Major Project Screw-Ups, and How to Cut Them Off at the Pass.

Jim Greeley, director of career services at Merrimack College in North Andover, Massachusetts, acknowledges that might make you nervous, as it should without an offer in hand. “But with an offer, it’s a totally reasonable question,” he says.

Benefits could be worth a few thousand dollars as part of your total compensation package. Consider the two most common benefits offered to new college grads: health insurance and retirement plans.

A Healthy Difference

You may be so desperate for health insurance that when you finally get an offer, you don’t take the time to analyze its attached health plan. But that could cost you.

Suppose hypothetical Job A pays $30,000 plus health benefits, while Job B comes in at $32,000 plus health benefits.

A no-brainer? Not necessarily. Suppose the Job A employer covers 100 percent of your monthly health insurance premium and that the insurance plan’s annual deductible, or out-of-pocket amount you’ll pay for medical care before insurance kicks in, is $500. Job B employer covers 80 percent of your monthly health insurance premium, with the rest, $200 per month, deducted from your paycheck. The annual deductible is $1,000.

Do the math:

    — Job A: With a $30,000 salary and no annual cost for health insurance, your net salary is $30,000.


    — Job B: With a $32,000 salary and your annual cost for health insurance at $2,400 ($200/month times 12 months), your net salary is $29,600 ($32,000 minus $2,400).

And if you spend $500 out of pocket the first year on doctor’s visits, your Job A net salary drops to $29,500 ($30,000 net salary minus your $500 deductible). Net salary for Job B falls to $29,100 ($29,600 net salary minus $500 of your $1,000 deductible) and will drop up to $500 more if you have additional health problems.


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