# How do I estimate the value of employer-provided job benefits, for comparing compensation?

I'm trying to put a number on the benefits (health insurance, dental insurance, 401k match, etc). that my job provides. I'm looking at a career move and would like a total compensation number for comparison. How can I put this number together? What information would I need? I define total compensation as...

`Total Compensation = Salary + Benefits`

I personally would include paid time-off (PTO) and sick days in that, but I don't know if that's right.

• Yes, paid days off are a benefit. – keshlam Jan 17 '17 at 13:04
• How are paid days off a calculable benefit? If you receive say \$100k a year with 14 days paid / off at job A and job B is the same but the paid days off is 20 days a year, you're still only receiving \$100k a year. – maplemale Jan 17 '17 at 17:25
• Days off are an opportunity cost. You could, for example, work a temp job or freelance on your vacation days. – Aravis Jan 17 '17 at 18:50
• @maplemale In the most simplistic approach, assume you work 8 hours per day, every non-holiday non-vacation weekday. Divide your 100k salary by that many hours. This is your hourly rate. If you could make the same 100k but work less, then your hourly rate has gone up. Hopefully, you receive some enjoyment from vacation days, or else you might as well just work 80 hours per week and be done with it. This situation is of course complicated, if your total workload over the year remains the same, regardless of vacation time. Calculating 'real hours worked' including overtime is more difficult. – Grade 'Eh' Bacon Jan 17 '17 at 21:41
• The most important variables in calculating the net benefit of insurance are a) Are you single/married or DP/have kids? b) What age are you? (20s? 30s? 40s? 50s?) c) Are you a smoker? d) Are you in good health and what are your estimated annual medical costs? Don't just look at the pre-tax difference in premiums: look at coverage levels, exclusions, waiting periods, patient star ratings for your local zipcode... – smci Mar 1 '17 at 0:52

The employer match on the 401k is easy as that is simply the net amount of money they match (e.g. 4% of salary).

The other items are a little trickier as there is their face value but what you really what to include is how much you value the benefit. I.e. if one offer has substantial better health insurance but you don't think that you will gain much benefit from its additional coverage, then it's value to is not that much more.

For sick days and vacation, consider how much salary you would need to be paid to take less, or alternatively if you had the option to buy more days how much would you give up. If you have 4 weeks of vacation and are constantly teaching the end of the year with time to burn, then you probably would value any additional vacation at zero.

I used to be in the HR field. "Compensation" is a term that is being used now-a-days to include both monetary (salary) and non-monetary (remote work) aspects. Depending on what benefits this company offers, you can include in your "total compensation" package your salary, any insurance that is provided (health, dental, accidental death and dismemberment, life insurance, etc.), as well as holidays and PTO (both vacation and sicks days), and other small things (free snack, set.c.

The salary and holidays/PTO are easy to calculate. For insurance, I would ask for a "Benefits Guide" or a "plan outline" that would show the portion of what the company would pay and what you would pay. Take health insurance for example. For a High Deductible Plan, you could be paying \$30 a paycheck for an individual plan, while the company pays \$270. Factor in a wellness plan that most companies offer at a discount of \$30 a month (but only if you go to the doctor once a year for a check up, and then do health-related activities and log them), that will save you money. But also have to see what the deductible is, as well as what the max out-of-pocket is, AND what the insurance coverage is. Generally most are either 90/10 or 80/20. What that means is once you hit your deductible, you either pay 10% or 20% of your medical bills until you reach your max-out-of-pocket. 10% could translate to a lot of money. For a 401k, see what percentage they match, as well as what the vesting schedule is. A vesting schedule is what some companies use to keep their employees.

Non-monetary benefits include being able to work remotely, having free snack/drinks at the office, a true work-life balance, casual work environment, culture, etc. All these should to be factored in as well. Hopefully this helps.

EDIT: Your title is "How do I calculate the value of job provided benefits? I want to add to my answer with a question - is this a job that is your dream? If you love, and I mean truly LOVE your job, then the value of that exceeds the monetary values it provides. Just my personal opinion. I've been told that do something you love, and the money will follow.