Here's how to understand the true value of a new job offer.
Does your new employer match retirement contributions? If so, what is the percentage and maximum the employer will match? Estimate the value of your match in your first year and add that to your base salary.
Find out if there's a vesting period for matching funds. If you're fully vested, it means you own 100 percent of the money in your retirement account. Some employers have a vesting schedule in which you don't fully own the match until you've been with the company for several years. With a five-year vesting schedule, you'd lose part of the matched funds if you left after four years.
Other considerations as you're comparing employer retirement plans: What are the fees associated with the employer's retirement options? Can you start contributing to retirement savings immediately, or is there a waiting period for new employees? How do the investment options compare to your current employer's plan? Ask the recruiter or hiring manager for a copy of the new employer's retirement plan documents, and call the retirement plan provider(s) with questions on fees.
Some employers may offer stock as part of employees' compensation. No one can predict how your employer's stock will perform over time, but this could ultimately put more money in your pocket as well.
Find out what portion of health care premiums the employer pays versus the employee. Is a health savings account or flexible spending account also available? Do the health care options carry a high deductible? Can you continue seeing your current doctors? If you have any pre-existing conditions, it's especially important to find out if your current providers and medications are covered and how much they cost. Calculate the value of the employer's contributions to your health care premiums and add that to your base salary. Then subtract the amount you're expected to contribute.
Does your new employer provide free or subsidized parking or a transit pass? If so, add the value of this benefit to your base salary. If you'll have to pay out of pocket for parking or bus fare, compare this to your current commuting cost. And if your new employer is significantly further from home than your current employer, consider the cost of gas and wear and tear on your car.
If you're considering a job in another state, some employers offer relocation packages. If you're stuck in a lease or own your home, ask if the new employer will pay the fees to break your lease or to sell your home. You'd also want to research living expenses in your state to ensure you're not accepting a small salary increase along with a substantial jump in cost of living.
What's the new employer's policy on paid time off ? Is it unlimited vacation time? A set number of sick days and vacation days? Do you get any floating holidays? If you're planning on starting or growing your family, how much (if any) paid paternity or maternity leave does the new employer offer? If any vacation days are left unused, can you get a vacation payout when you leave the company? Does paid leave accrue from year to year, or are there a limited number of days that can carry over to a new year? Estimate the value of your PTO based on your new salary. If, for instance, you currently have three weeks of PTO and the new employer only offers two, can you negotiate an extra week?
Some companies offer sign-on bonuses, performance bonuses or certification bonuses if you earn certain professional designations. You can't bank on performance bonuses, so that money shouldn't figure into your day-to-day budget. However, if you work in sales or another role that offers bonus compensation, you might consider the bonus structure as you're comparing total compensation.
Does this employer typically pay for employees to attend industry conferences or obtain relevant certifications? Is tuition reimbursement available for graduate-level coursework in your field? Add the value of these perks to your base salary.
Professional development benefits can help you advance in your career and make you more marketable for your next job, so leaving a job that offers these things for one that doesn't could set you back more than you'd think.
This may not be easy to quantify in dollars, but you should also consider the opportunities for advancement. Working at a company that offers upward mobility to high-performing employees could mean more money in your pocket over the long term.