It isn’t uncommon for employers to offer health insurance, a 401(k) plan or other perks in addition to an annual salary. While benefit packages may be largely the same regardless of where you work, it is still a good idea to know what a prospective employer could provide.
A 401(k) Match Is Essentially Free Money
If your employer is willing to match your 401(k) contributions, you are getting the equivalent to a 100% return on your investment. The match usually isn’t unlimited i.e. you couldn’t double your entire salary by contributing all of it but whatever the maximum is you should definitely try to take advantage of all of it. Best of all, this money will grow exponentially and tax-free for many years or decades to come. As an employer match can make it easier to retire comfortably, it is important that you understand how it works and how to best take advantage of it.
Health Savings Accounts Can Accrue Interest
Money kept in a health savings account (HSA) could accrue interest throughout the year. Therefore, you are being paid to save money to pay for doctor’s visits, eyeglasses and other needs that may arise. It may not be possible to take the money out of the account at the end of the year, so be sure to understand the terms and conditions.
Routine Health Checks Can Prevent Expensive Health Issues
The ability to see a doctor, dentist or optometrist on a regular basis can ensure that any minor health problems are caught as quickly as possible. Typically, it is easier to get rid of a suspicious mole or repair a chipped tooth than it is to eradicate cancer or replace all of your teeth with implants. Your employer should explain the difference between the health plans offered and how much you will be required to pay out of your own pocket.
Signing Bonuses Can Help Provide Financial Security
The one drawback to starting a new job is that you may not get paid for several weeks after your start date. However, a signing bonus is guaranteed money that is paid in a lump sum when you agree to work for an organization. Ideally, you can get that money before your first paycheck and use it to pay bills or replenish your emergency fund.
The next time that you are in the market for a job, don’t underestimate the importance of a benefits package. In some cases, stock options or a 401(k) match can be more valuable in the long run than a higher starting salary.
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