Look At Total Compensation Instead Of Salary When Evaluating Pay
By David Dierking
Let’s face it. Now is not exactly the best time to be looking for a significant increase in your salary. Even if you’re a top performer, a lot of companies just aren’t opening up the coffers like they used to. With the unemployment rate still around 9%, there are a lot of workers out there more than willing to take your job. Plus, many companies are still struggling to make their bottom line numbers so money for raises and bonuses may be tighter.
That doesn’t mean that you can’t increase your total compensation though.
When searching for a new job or looking to ask their manager for a raise, most people focus on the position’s salary. In reality, the total compensation figure for the position is much more relevant. It takes into account not only the salary for the position but all of the additional benefits that go along with it that you may not have thought about.
It makes sense to pay more attention to total compensation because while managers may have a difficult time offering increases in salary they may be more willing or able to offer some other type of benefit in lieu of an increase in your paycheck. It’s not unheard of for companies to offer some type of stock option or increased wellness benefit, for example, as an incentive to employees.
Total compensation can have a lot of pieces in it so let’s take a look at some of the extra ways you can or already are being compensated in addition to your salary.
If you’re receiving a typical match of 50% on the first 6% of your compensation, that’s an extra 3% of your salary that’s coming your way. In rare cases, you may even still be getting a pension contribution from your company. More free money!
Options can become very valuable if the stock price of the company goes up. These are usually reserved for higher grade employees but you may be able to receive these as part of a bonus.
Health and Dental Insurance
You may not like the current cost of medical insurance but you can be thankful that most companies still foot the majority of the bill for insurance premiums. This benefit alone can add up to thousands of dollars over the course of a year that you don’t have to pay.
A lot more companies nowadays are offering wellness incentives in the form of lower health insurance premiums for non-smokers or discounted health club memberships.
You may not even know it but there’s a good chance your employer may be fully funding the cost of a life insurance policy in your name. Not a million dollar policy mind you but enough to cover funeral and transitional expenses for your family should something happen to you.
You get paid for staying home. Enough said.
When added all together, the value of all benefits received could add up to as much as 20% or more of your base salary on an annual basis. That could be big bucks that you’re already getting that you don’t even think twice about.
But think about this. Next time you’re negotiating and the boss won’t budge on salary, ask him if he can kick in a little extra on one of the above. An extra week’s vacation, some stock options as a signing bonus or free health club membership might serve as enough of a sweetener to seal the deal.
After all, it’s compensation that ends up in your pocket no matter which form it comes in.
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