Value of Benefits in a job

[JeenLeen]

I'm considering taking a contractor position (to hopefully eventually become a full-time 'real' position) at a company.

I'm not asking for financial advice; I know that's against the forum rules as it is professional advice.
But does anyone know where I could go to find out something like the average cost to purchase insurance? Or something to estimate the value of a benefits package one already has? I really want to estimate the current value of my full-time position, encompassing both salary and benefits, but I feel somewhat at a loss how to get started.

[truemane]

Since you said 'benefits' and not 'Health Insurance' I'm assuming you live in Canada.

Health and Dental Insurance for a family in Ontario is worth between $300 and $400 per month. I would imagine it's somewhere in that neighbourhood for most other places too.

For an individual, it's more like $150 - $200 per month.

Plus or minus a whole host of variables.

[JeenLeen]

United States. The main benefit I'm concerned with is health insurance, but also wanting to incorporating money for retirement plan and annual/sick leave. But it's relatively easy for me to calculate how much goes into my retirement plan currently, and I can look at the hourly rate for the days off I want to include that into the time I'd work.

Health insurance (medical and dental) is main nebulous thing to me.
And for a family. Currently I pay about 300 to 350 a month, for the plan with my work.

[truemane]

That makes sense.

I can't be of any real help with US insurance rated, and suggest maybe just look up a couple of major insurance companies and see if you can get a quote.

[Tyndmyr]

Your company may already do this for you. I've worked at a few places that showed "total compensation", both cash and listing all their benefits with a value.

At an absolute minimum, retirement funds should report the exact value to you. If the company is contributing $x to your retirement, well, that's the value.

I'd probably discount the value of anything you could use, but don't. If there's a discount golfing arrangement because half the company golfs together, cool, but if you don't golf, does it really matter?

Health/dental are much fuzzier. Vision is not a huge deal. In most cases, you're gonna get a vision check every two years, with a minimal copay, and they reduce your glasses by some minimal account(Zenni Optical or something is MUCH cheaper). Most vision plans look pretty similar.

I would suggest comparing health plans head to head, and see how well each fits your circumstance. A lot of times, they're not strictly monetary. If this plan requires you to see doctors from a specific list, that's not as good as seeing whoever you want, even if it's hard to value that directly. Get an overall feel for which you like more.

You *can* ask how much will be taken from your paycheck for each health care plan, that information should be fairly available, so at least that portion of it isn't too bad.

You can somewhat decrease what you pay in terms of copays, etc by utilizing an HSA. If you have/have access to an HSA, basically you're using that to set aside pretax dollars for medical expenses. Exact value will depend on how much you put aside, and how bad you get hit on taxes.

Medical stuff in the US is complicated, sorry. All of the above is just a rough guide as to how to get the info you need, I'm certainly not knowledgeable to be able to quote values for plans, it's not really a field I'm in, it's just something I've occasionally had to deal with. In any case, congratulations on your new opportunity!

[Sermil]

One possibility is to look at some of the insurance exchanges that were set up by the Affordable Care Act (a.k.a. Obamacare), try to find a comparable plan, and see its cost.

Remember that most companies will expect you to take some amount out of your paycheck each cycle (pre-tax) to cover part of the premiums, so subtract that from the benefit.

[TexasSkiandFish]

Also do not underestimate paid vacation and holidays. We make our contractors take unpaid vacation days over holidays. This adds up to around 6% of their salary if they take 2 weeks of vacation in addition to holidays.

Also, many companies offer life insurance, legal, identify theft protection, etc. If you have those currently make sure to add that in.

[JeenLeen]

Thanks, y'all.
I did remember to incorporate leave. To play it safe, I decided to estimate my 'take home pay' as if I'm working 4 days a week instead of 5. Most weeks I'll work 5, but that way, over time, I should have enough money if, say, I'm out sick a week.
Fortunately, it's a work-at-home position, so, even if I'm sick, I can probably work unless I'm very sick.

This morning I remembered the agony that is self-employment taxes! I had forgotten to set aside money to pay income tax, Medicare, and Social Security. That bumped my estimated rate up by 5 dollars an hour.

[Joran]

One possibility is to look at some of the insurance exchanges that were set up by the Affordable Care Act (a.k.a. Obamacare), try to find a comparable plan, and see its cost.

Remember that most companies will expect you to take some amount out of your paycheck each cycle (pre-tax) to cover part of the premiums, so subtract that from the benefit.

Yup, this, remember that buying insurance for an individual / family on the exchanges are going to be a different price than a company will pay for a group plan.

If you have access to your W-2, box 12 code DD has what you and your company paid for healthcare in the last year combined XD

[TexasSkiandFish]

Another benefit that you need to consider is unemployment insurance. I have a few contractors that work for me and this is one of the reasons my company insists that I hire contractors over full time employees.

They are easy to let go in a downturn.

You could figure out how much you will get paid by your state if you are laid off, the duration of payments, and then add that into your salary as well.

What industry are you applying for. If it is relevant to my industry I can let you know how much I pay my contractors.

[JeenLeen]

Computer programming.

On unemployment:
One somewhat comical boon is that my current employer is VERY slow to fill empty positions. This contract will last until about the end of the year. If it isn't renewed or turned into a full-time permanent position, it's quite possible I could apply for and get the job I'm leaving. The time table sounds about right that they'd be filling it about when my contract ends.
I might even get hired back with a higher salary than I left, since I know they factor in current salary into the salary they offer someone.

[TexasSkiandFish]

I am a software engineering manager/architect. I will PM you the price we pay per hour. Although it depends on where you are located, industry, technology, and front end, backend, full stack, etc.

[Tyndmyr]

Computer programming.

Job security is...less of a concern for us.

Hell, if you're shopping, and have splunk expertise, I might hunt a resume off ya.

[JeenLeen]

I am a software engineering manager/architect. I will PM you the price we pay per hour. Although it depends on where you are located, industry, technology, and front end, backend, full stack, etc.

Job security is...less of a concern for us.

Hell, if you're shopping, and have splunk expertise, I might hunt a resume off ya.

I appreciate it, but my expertise is mostly tied to the SAS programming language; I love using it, but it is a bit more niche than some languages. I know enough SQL in its 'dialect' to probably work in SQL Server or some other system, but limited experience actually using those softwares. So more transforming, moving, and reporting data than making things (other than, like, reports of numbers) via coding.

[tomandtish]

Since you said 'benefits' and not 'Health Insurance' I'm assuming you live in Canada.

Health and Dental Insurance for a family in Ontario is worth between $300 and $400 per month. I would imagine it's somewhere in that neighbourhood for most other places too.

For an individual, it's more like $150 - $200 per month.

Plus or minus a whole host of variables.

United States. The main benefit I'm concerned with is health insurance, but also wanting to incorporating money for retirement plan and annual/sick leave. But it's relatively easy for me to calculate how much goes into my retirement plan currently, and I can look at the hourly rate for the days off I want to include that into the time I'd work.

Health insurance (medical and dental) is main nebulous thing to me.
And for a family. Currently I pay about 300 to 350 a month, for the plan with my work.

Yeah, it's very important to note that benefits include a lot more that insurance. We tend to say benefits where I work when we're talking about the whole package.

And as others have said, it depends on what you are offered. Let me give you a summary of mine (I work for State of Texas).

Health Insurance: State pays for my insurance (choice of 3 plans or a high deductible spending account) and 1/2 of my wife's coverage. Mine is $960 a month and they pay $480 for my wife, so about $1440 a month.

Other Insurances: I buy (through the state) a life insurance equal to 4 times my annual salary, Accidental Death and Disability insurance (additional $200k), short-term and long-term disability (pays 2/3rds of salary if I am unable to work for extended times). I also buy vision and dental insurance.

Paid Leave: I'm going to discuss it all in one section, but I get 17 hours paid leave a month, 8 hours sick leave on top of it, and we average about 14 paid holidays a year (I either don't use leave for the holiday if I don't work it, or earn 8 hours leave if I do). So about 64 days a year (a new employee would earn less but I've been there 25 years).

Employment benefits program: More nebulous, but I can access free counseling and legal services. I also get discounts on a variety of things from movie tickets to car rentals. 20% discount on my cell service. Free parking at downtown buildings/lots.

Retirement: I'm on a pension. I pay 10% of my salary, and state matches it.

Lump it all together, and while salaries for state employees aren't the best, the benefits are pretty nice. So put all yours together in one place and see what you think they are worth.

[TexasSkiandFish]

Update?

Did you make an offer?

[JeenLeen]

A big thing I learned is to ask early on if the contractor position is paid via a W-2 or a W... uh, whatever contractors normally use.
At least for US tax purposes.

This one is actually via W-2, so my calculations were WAY off since my tax withholdings (including FICA-based) would be like a normal employee, not the higher contractor rate. So basically all my estimates were based on faulty assumptions, and I had to recalculate everything.

So I'm hammering out the details. I don't want to go into the details here, but it looks like it'll end up being rather favorable (even with very increased insurance premiums). Plus, I think I'll enjoy this work more than the work I'm currently doing, and it's a work-from-home position, so those are perks even if the "cash I can actually spend after premiums, retirement, setting aside to compensate for unpaid leave" isn't quite as high as I would hope.

[Khedrac]

A big thing I learned is to ask early on if the contractor position is paid via a W-2 or a W... uh, whatever contractors normally use.
At least for US tax purposes.

This one is actually via W-2, so my calculations were WAY off since my tax withholdings (including FICA-based) would be like a normal employee, not the higher contractor rate. So basically all my estimates were based on faulty assumptions, and I had to recalculate everything.

So I'm hammering out the details. I don't want to go into the details here, but it looks like it'll end up being rather favorable (even with very increased insurance premiums). Plus, I think I'll enjoy this work more than the work I'm currently doing, and it's a work-from-home position, so those are perks even if the "cash I can actually spend after premiums, retirement, setting aside to compensate for unpaid leave" isn't quite as high as I would hope.

So generally good news - that's nice to hear - congratulations.

[Peelee]

A big thing I learned is to ask early on if the contractor position is paid via a W-2 or a W... uh, whatever contractors normally use.

1099, and that's a huge thing for more than just tax purposes. IIRC that also differentiates how employment law treats you. Short version, if you can help it, you usually don't want to be a 1099.

[JeenLeen]

Thanks for the advice, y'all. A lot of it wound up being moot with me learning it was W-2, but it was still fun to learn and helped make the thought process less stressful.

1099, and that's a huge thing for more than just tax purposes. IIRC that also differentiates how employment law treats you. Short version, if you can help it, you usually don't want to be a 1099.

Cool. I was only looking at it from a tax perspective, but that's good to know if anything wonky happens where such would matter.
A former co-worker of mine became a contractor under a W-2, and I was relieved to hear that he said his taxes weren't any more complicated than when he was a employee where I currently work.

If things go as planned, my 2021 taxes may look a bit odd in that I'll have three W-2s: where I currently work, the contracting firm used by where going to, and the company I'm going to when they hire me on as permanent.
I may not have mentioned it, but the contractor part is supposed to be temporary. They're doing some bureaucratic moving-around to open some permanent positions, so this is just to get me in and starting working until that comes into play. My salary will go down, of course, but I know roughly what it'll go down to (still nice) and the benefits package for permanent employees is awesome.

[Kornaki]

The story of if you take this job, you can get this other job later is a pretty common one. It doesn't sound like it's what you're doing, but I wouldn't rely on the second job coming through if it's the only reason you're taking the first one.

[dps]

I think I'll enjoy this work more than the work I'm currently doing

Stuff like this really complicates things. There's no doubt that liking what you're doing is a huge value, bit it's almost impossible to put a dollar figure on it.

And you can also get into what might be called "procedural" benefits, which isn't exactly about the benefits themselves byt how they're administered. For example, from 1988 to 2002, I worked I an employer who, when it was time to sign up for health insurance, had a rep from the insurance company come around and meet with each employee individually and help them figure out which coverage was right for them. No other place I've worked has done that, but there's no doubt it was a valuable to service to most of the employees--in contrast, the place I worked from 2009-2020 offered about a dozen or so different health care plans, but there was no one to explain the different features if anyone had questions, much less help employees figure out which plan was best for them. But the fact that the place I was employed up to 2002 actually had someone to help the employees sort through the plans wasn't listed anywhere as a benefit. Or talk y to find out that 2 different employers both offer 2 weeks paid vacation after 1 year, 3 weeks after 2 years, etc., but what that doesn't tell you is that employer A requires that you submit your vacation request 6 months ahead of time and then it's still like pulling teeth to get it approved, whereas employer B only requires the request 1 month in advance, and everyone there almost always gets their requests approved.

[tomandtish]

Stuff like this really complicates things. There's no doubt that liking what you're doing is a huge value, bit it's almost impossible to put a dollar figure on it.

And you can also get into what might be called "procedural" benefits, which isn't exactly about the benefits themselves byt how they're administered. For example, from 1988 to 2002, I worked I an employer who, when it was time to sign up for health insurance, had a rep from the insurance company come around and meet with each employee individually and help them figure out which coverage was right for them. No other place I've worked has done that, but there's no doubt it was a valuable to service to most of the employees--in contrast, the place I worked from 2009-2020 offered about a dozen or so different health care plans, but there was no one to explain the different features if anyone had questions, much less help employees figure out which plan was best for them. But the fact that the place I was employed up to 2002 actually had someone to help the employees sort through the plans wasn't listed anywhere as a benefit. Or talk y to find out that 2 different employers both offer 2 weeks paid vacation after 1 year, 3 weeks after 2 years, etc., but what that doesn't tell you is that employer A requires that you submit your vacation request 6 months ahead of time and then it's still like pulling teeth to get it approved, whereas employer B only requires the request 1 month in advance, and everyone there almost always gets their requests approved.

Yeah, there's always going to be the intangibles. The things that will mean different things to different people. I personally always rate enjoying my work as worth thousands a year (turned down an offer that would have gotten me 30k more, but I knew I would be miserable).