2020 has been a year of change. The pandemic has given people an opportunity to rethink their lives and many have been rethinking their career. Whether you are one of the millions of people that have been forced into a job change or whether you are considering a professional pivot on your own, there is a lot to think about when changing jobs. On this episode, we walk you through the details that you need to consider when taking on a new job. If you are rethinking your career, listen in to hear how you can best use your human capital.
Think about the total compensation not just the salary
Often when we consider a job offer there is only one number we look at, the base salary. But there is more to a job than simply the base salary; it is important to consider the total compensation. Your base salary helps you plan your monthly expenses but understanding the bonus and stock compensation is also important.
When thinking about the bonus structure of a potential job you’ll want to consider the target. Ask what the confidence in that target is. You’ll also need to understand how the bonus incentive works. How often does it payout? Is the bonus based on your personal performance or on the performance of the team?
Some other financial considerations are the stock options and the sign-on bonus. The hiring bonus can be enticing, but don’t let it cloud your judgment. Remember a hiring bonus is only a one-time payment.
Consider the benefits package
When comparing job offers you’ll also want to compare the benefits package. Make sure to request an employee benefits brochure if they haven’t given you one. The benefits package is often seen as secondary to the financial compensation but those benefits can add a lot of value to your life.
First of all, you’ll want to consider the healthcare plan. Does the company offer one? How does it compare with your current plan? How much of the plan is covered by the employer? Do they offer an HSA?
Healthcare isn’t the only benefit to consider. What about life insurance and disability? Does the company offer a student loan repayment program? How about a fitness membership? Consider the entire benefits package and how it could add value to your life.
What is the retirement plan like?
In addition to the health benefits and salary, you’ll also want to investigate the retirement plan that comes with this new position. Do they offer a 401K? Will they match your contribution? What are the plan costs? What about vesting, will you actually realize that vesting period? Do they offer other ways to save for retirement?
Your human capital is one of the biggest assets you have and the way you spend it will greatly impact your financial future. So when considering a job transition, there is much more to think about than just the base salary. Tune in to this episode to discover all the details you need to consider when evaluating a job change.
Outline of This Episode
- [2:50] Think about the total compensation not just the salary
- [8:30] What is included in the benefits package?
- [13:42] What is the retirement plan like?
- [20:22] Does the position include an employee stock purchase plan?
- [24:31] What about the flexibility factor?
- [27:54] Consider all your details
Resources & People Mentioned
- Episode 97 – How to Make Decisions About Your Equity Compensation Plans
- Episode 47 – Why Do I Need an HSA?
- Episode 91 – Your Retirement Secret Weapon
Connect With Chad and Grayson
- https://www.financialsymmetry.com/podcast-archive/
- Connect on Twitter @csmithraleigh@TeamFSINC
- Follow Financial Symmetry on Facebook
