Take Less, Make More: Why Benefits Matter!
Companies are offering all sorts of different perks with jobs these days and it’s important to see what the company you’re looking at offers beyond the base salary. Getting a job offer is a very exciting time, emotions often run high, but this is the time to be practical and truly understand what’s on the table. Insurance, Bonus structure, ESOP and more can all have very real effects on what you take home.
Don’t let a lower than expected salary scare you away. There may be other benefits that outweigh your base salary. This is where knowing what is important to you comes into play. Health Insurance, auto allowance, vacations, PTO, sick days, per diems, dress down Fridays, fresh fruit in the lunch rooms, Health Club Memberships, Education Reimbursement, ESOP’s, 401K’s, phones, computers are all important benefits your company could offer. It is up to you to know the value of each of these.
If you’re looking for money, don’t under estimate the power of the Employee Stock Ownership Plan or ESOP. We were working with a person who was faced with competing offers, where one salary was $7000 less than the other offer given. The choice seemed obvious until we started to compare benefits. The insurance was comparable, however the company with the lower base salary offered a phenomenal ESOP plan that had returned a 12% payout for the past 12 years to their employees. This closed the gap in pay. Their decision came down to a choice of company cultures and vision. They felt the company with lower base pay ultimately had a better culture and vision for the future and the candidate accepted the role.
When changing jobs and comparing benefits don’t think that ESOP’s are the same as 401K plans. In a 401K you put your money into it and the company may or may not make a match up to a certain percentage of your salary. In an ESOP the company gives you a dollar amount for shares of their stock. These stocks have value year over year. You do need to do your homework and check and to see how much percentage they go up each year. Ask for the past 5-10 years’ history if you want to know that real value of an ESOP. From our example, 12% each year of your salary back is a huge benefit. You can’t get that match in a 401K.
In the end, it’s up to you to know what matters. Maybe the company with the best ESOP also requires you work over time, or weekends, or maybe they also have extra vacation time but a lower base salary. When you start your job search, layout what you are looking for. Know what you want and you will be able to know the right opportunity when it comes along.
What other incredible benefits have you seen from your company or your search? I would love to hear about them.