Pay Attention to Your Employee Benefits. They Can Be More Important Than Your Salary.

Even though you get paid well in the tech industry–in both dollars and company stock–there’s another part of your total compensation that you should probably pay more attention to: employee benefits.

I have always reviewed my clients’ employee benefits.  But when I read Sarah Lacy’s recent book, A Uterus is a Feature, Not a Bug,  I realized women in tech (that is, you) need to investigate your employee benefits more closely. And they need to be a bigger part of your negotiation when taking a new job.

Why Employee Benefits Are So Important

Ms. Lacy asserts that women’s rights and safety nets are being stripped away at the federal-government level. Which means those rights and safety nets are:

falling more and more into the hands of states or private corporations. Individual companies are offering some of the best parental benefits anywhere in the world….There’s little hope that rights for parents and mothers will become decoupled from employment anytime soon.

And while she focuses on parents and mothers in particular in her book, these safety nets and rights are important for everyone, with-child or without. Employee benefits can include some pretty life-saving and life-improving things, like long-term disability insurance. Or generous family leave. Or free health insurance.

Those particular benefits can be worth literally thousands of dollars a year. A significant percentage of your Very Nice Salary. Also, you’re unlikely to be able to get the same level of service, or anywhere near the same price, on your own because your company, even a small one, has group bargaining power.

Understanding Your Benefits

I really want you to read through and understand what your employee benefits are. And you want to make me happy, don’t you?

Maybe it’ll take 1 hour. And then you don’t have to do it again until open enrollment rolls around next October! The Bar Is Low, People.

If you don’t know where you can learn about your employee benefits, ask your HR department. Ideally, there’s some sort of consolidated PDF that lists everything. Hell, Google provides a multi-page summary of benefits (or did, last I looked). And then you can read all the details in a book with the world’s worst plot.

Or maybe, as I often see, there’s a giant unwieldy website or intranet where you have to drill down a thousand different rat holes to learn about all the various options available to you. Sorry ‘bout that…bureaucracy–and bad site design–are a bitch.

So, what benefits are available to you? The most important ones are usually:

  • Health insurance
  • Long-term disability insurance. Short-term is usually less pressing. And in California and a few other states, the state itself provides a short-term disability policy through universal paycheck deductions.
  • Family leave. Do you want to have a child while at this job? Do you have an ailing family member who needs a lot of your time? The federal government mandates certain minimum benefits. And some states mandate even more generous benefits. Maybe your company goes beyond that. Only your benefits booklet can tell….
  • Flex time and remote work. Running a virtual financial planning firm as I do, I of course think these two benefits are the bees knees. But seriously, being evaluated for your work, not for your Ass In Chair time can be pretty wonderful, and also allow you to get to the doctor like you swear you’ve been needing to for the last 6 months.

Then the more-minor but sometimes quite financially valuable ones, like:

  • Tax-free transit passes
  • Free legal services.  Which maybe you could use to get basic estate planning documents drafted for you!
  • Dedicated commute shuttles. It sure is nice not to have to drive or navigate mass transit yourself. Maybe you can even get work done on the bus and therefore spend less time in the office.
  • Rental car discounts and other, bizarro discounts
  • I even have a client whose company brings mani-pedis in-house once a week…a benefit which, admittedly, she considers ridiculous…”Can someone please check on that production incident? I’m getting my nails done!”

A lot of benefits are weird and unexpected. Which is why you’ve got to see the full listing of benefits to know what’s available to you!

Take a moment to think about how you might actually use these benefits.

Think About Benefits When Looking for a New Job

Although most people compare jobs along the lines of salary, equity, and the actual work you’ll be doing, please please start looking more intently at employee benefits. A couple of examples to illustrate my point.

Example #1: Having a Baby. Let’s say you have a kid while at a job. Let’s also say you chose the job you have because it paid an extra $20k/year. Not chump change.

But you neglected to pay enough attention to the employee benefits, and this company doesn’t provide anything above the federal government mandated 12 weeks of job-protected unpaid leave for this sort of situation.

So, sure, go ahead and take time out to care for yourself or your family, but you’ll be foregoing three months of income, which for most of you, is going to be a hell of a lot more than $20k. And maybe your company is legally required to protect your job, but the company culture doesn’t really work well for people who actually take advantage of this benefit.

The more financial resources your company puts towards family and medical leave, the more confident I’d be that the company has figured out how to actually run a business while allowing people to take that time away from their jobs.

Example #2: Long-term disability insurance. Company A offers long-term disability insurance at 70% income replacement rate, and Company B at a 50% replacement rate. (I won’t compare to a company that offers no disability insurance, because that’s an unfair fight!)

Let’s say you make $200k. If you become disabled (and depending on which statistic you read, you’ve got anywhere from a 1-in-5 to 1-in-3 chance of doing so) and can’t do your job, you will get a replacement income of $140k/year from Company A’s policy. And of $100k/year from Company B.

In an extreme situation, that could be a $40k/year income difference for years and years. That’s Big.

So, please, look at employee benefits as part of the total compensation package when comparing jobs. It might well make sense to take a job that pays less because it provides more support–financial, professional, cultural–in other areas of your life.

Do you want to understand and take full advantage of your employee benefits? Reach out to me at meg@flowfp.com or schedule a free consultation.

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Disclaimer: This article is provided for general information and illustration purposes only. Nothing contained in the material constitutes tax advice, a recommendation for purchase or sale of any security, or investment advisory services. I encourage you to consult a financial planner, accountant, and/or legal counsel for advice specific to your situation. Reproduction of this material is prohibited without written permission from Meg Bartelt, and all rights are reserved. Read the full Disclaimer.

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