Manage Your Finances, Master Your Life: How to Maximize Your Employment Benefits
Manage Your Finances, Master Your Life: How to Maximize Your Employment Benefits
Your employment benefits can add as much as 30 percent to the value of your salary. And it does add up: consider the value of insurance, retirement plans, other tax-deferred savings plans, employer matches, and other benefits, and you could easily find you have access to many thousands of additional dollars per year. Once you know what you have, it’s just a matter of taking advantage of it.
Know Exactly What Your Benefits Package Includes
The first step in maximizing the value of your employment benefits is to sit down with your company’s human resources department and figure out what you have available to you. “Many employee benefit packages come with additional features that most workers don’t take advantage of,” says employee benefit insurance expert Rob Rieckenberg. “When you have health and life insurance through your employer, there’s a good chance that you also have vision, dental and disability coverage available to you.” In addition, your employer may also have negotiated benefits with vendors like cell phone providers to create discounts for you. “Just ask – your employer usually wants you to use the benefits.”
Take Advantage of Your Company’s Saving Plans
Taking advantage of your company’s tax-advantaged savings plans can accelerate your savings. For example, if you pay 25 percent state and federal income tax, taking $100 out of your paycheck to put into your company’s 401(k) plan will only reduce your paycheck by $75. Furthermore, if your company offers a 25 percent match, that $75 reduction from your pay represents $125 in savings — a 67 percent increase. If you put away $75 a month every month for three years and made 6 percent interest, you’d save $2,700 and end up with $2,965. However, if you take advantage of your employer’s program, your paychecks would still go down by a total of $2,700, but you’d be putting away $125 a month and end up with $4,941 in savings. The more that you can use your employer’s savings plan, the better off you will usually be, and Rickenberg advises that you “get every penny that you can out of your employer’s matching program, since free money is a good thing!”
Take Advantage of Preventative Health Benefits
“Health insurers are realizing that investing in the health of the people they insure saves them money,” explains Rieckenberg. “Look carefully at your preventative health benefits — it may include coverage for gym memberships, weight-loss programs and the like.” Don’t forget about other benefits like vision or dental coverage, either. If your employer has a health savings account or flex spending account program, it’ll let you pay for deductibles, uncovered dental expenses and prescription drug co-pays with pre-tax dollars, saving you more money. Finally, advises Riekenberg, “Pay attention to your deductible. If you know you’ve hit it, get as much medical care as you can before your deductible resets at the end of the year.”
Check Your Company’s Benefits First
Your benefits package can enrich your life, as well. If you’re considering education to improve your job skills or maintain your professional licensure, consider looking to see if your company has a tuition reimbursement program. Your company may also provide access to discounted legal or accounting services to help you with your personal finances. When you travel, see if you can use your company’s negotiated rates with hotel chains or car rental companies to save time and if you move, see if your company has a relocation agreement with a real estate company or with a mover. The company’s discounts and benefits won’t always be a better deal than what you can find on the open market, but it’s almost always a good idea to check them out first.
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