How to value employee benefits?
To fairly compare a comp-only job to a job that offers insurance, get a quote for health insurance. Call your local insurance broker and find out what it would cost. Because if you aren't getting insurance from your employer, you'll have to get it elsewhere. If you get a quote on an HSA, don't forget to add in the annual deductible as part of the cost. On the ESPP, I'd count it as zero. The rationale being that so much of your financial status is tied to your employer that you don't really want to tie up too much more in company stock. (I.e. Company hits hard times, stock tanks, and then they lay you off. Double whammy -- both your assets and income.) But given that I've only been employed by companies that no longer exist in their original form, my perspective may be warped. It would depend on the health insurance that was being offered, and if it covers your family or just you. We pay around $500-600 for individual health insurance for our employees (families cost north of 1500 a month).  It's extremely expensive. Provide more details on the stock purchase plan as well (it sounds to me like in that case you'd only be getting for free what it would cost to purchase the stock... but that's only $10-15, so negligible in this case.) Employee Stock Purchase Plans (ESPPs) were heavily neutered by U.S. tax laws a few years ago, and many companies have cut them way back. While discounts of 15% were common a decade ago, now a company can only offer negligible discounts of 5% or less (tax free), and you can just as easily get that from fluctuations in the market. These are the features to look for to determine if the ESPP is even worth the effort: As for a cash value, if a plan has at least one of those features, (and you believe the stock has real long term value), you still have to determine how much of your money you can afford to divert into stock. If the discount is 5%, the company is paying you an extra 5% on the money you put into the plan. Health insurance varies wildly per state and per plan and per provider - but check them out to have a baseline to know what it should cost if you did it yourself. Don't forget vacation time, too: many contract/comp-only jobs have no vacation time - how much is that 10 or 15 days a year worth to you? It effectively means you're getting paid for 2080 hours, but working 2000 (with the 2 week number). Is the comp-only offer allowing overtime, and will they approve it? Is the benefits-included job salaried? If it's truly likely you'll be working more than a normal 40 hour week on a routine basis (see if you can talk to other folks that work there), an offer that will pay overtime is likely going to be better than one that wouldn't .. but perhaps not in your setting if it also loses the PTO.
"sorry mate, its not about being loyal. it's about what you negotiate.   you stay with a company long enough and you'll only rack up your annual 2% pay increase and see minor raises until you're promoted to incompetence. If you really want to see healthy compensation than you need to realize it's about negotiating to your true value to the market - not just join a company and cross your fingers for the best.   Frankly, if someone is willing to pay more ($$ and other benefits) then you'd do yourself and those you support a disservice not going for it. There are times when you should be less aggressive about it for the long haul, but don't forget, a company's job is to turn a profit which means getting workers to work at the lowest possible salary. And when a corporation thinks someone is ""loyal"" and won't move, then a smart company will go ahead and test that assumption.  Re: entry level expectations about their true value - absolutely agree, expect entry compensation. But don't think being ""loyal"" is what changes that. Only increasing your actual value does - not just because you've been around forever." "Logic fail. The qty of shares is irrelevant. What matters is the value, which is, of course, quite high -- and, what's more, the P/E ratio, which is extremely favorable. Having worked in operations at Apple for 7 years, I can tell you that the company is very lean and efficient.  25% matching is extremely generous. 25% contribution rates are standard in corporate jobs (contribution rates are what maximum percentage of your pre-tax income you can opt to set aside into a 401K; this is different than matching). It absolutely is not bare bones to be given 25% matching. Although I no longer work at Apple, I still have my 401K, and the administration of it is good, as is the choice of funds. Back to the matching... It's free money. For every $1 you put in your 401K (pretax, btw), Apple puts in a quarter. Having worked in other corporations over my career, I can tell you that this level of matching is pretty much as good as it gets.   For a good part of the time I worked there I made around $30K (not in Retail, but in Operations, as mentioned before). I maxed out the Employee Stock Purchase Program contribution and mostly maxed out my 401K contribution. Now, 12 years later, my stock appreciated beyond my wildest expectations. I have made well over six figures on it over the years. If I never sold any, it would be worth over $500,000 by now. All that from 10% contributions on a salary that ranged from about $26K when I started out to about $46K when I left 7 years later. My 401K holdings are worth about $60K, I think, invested extremely conservatively. I have had it in money market funds since right before the 2008/2009 crash, which I anticipated.  So the investment benefits at Apple served me extremely well. My stock appreciation paid for my car, and it will soon cover the down payment on a house. I was essentially able to ""retire"" to be a stay-at-home-mom when my son was born, thanks to the safety net I have from my Apple stock.  Regarding health benefits...  I think you meant to say copays, not deductibles. When I was there, there were no copays. I forgot what the deductibles were, but for most routine visits, you wouldn't need to pay out of pocket. Annual physicals are included in the health plan, up to $250. The health plan works with various local providers to ensure that the $250 allotment will cover all expenses needed for an annual physical. This physical is separate and in addition to a women's health annual exam (pap smear/pelvic exam/etc) that is also included without copay. I'm pretty sure annual mammograms are covered. All prenatal visits are covered with zero copay. All child well checks, including immunizations, covered with zero copay. Two dental checks a year. Dental Xrays at regular intervals included. Annual vision exams and, I think $300 annually towards glasses or contacts included, IIRC.   Time off was pretty standard and accrued by the hour worked, which was nice. There was no ""you have to be with the company for X length of time"" before time off benefits began to accrue, or before any benefits kicked in, for that matter. By about Year 5, I had easily racked up enough vacation days to take 3 weeks off at a time. The longer you have been with the company, the faster your time off accrues. And each summer they'd offer a cash-out program, where you could double up on time off, where if you took off a week, you could opt to deplete your accrued vacation time by two weeks and get double pay for it. A lot of people liked this option.  The points for absenteeism thing seemed a bit silly -- and seemed to only have been implemented in one store and then only for a brief time. From what I gathered in the article, it was an experiment that failed miserably.  The other corporation I have spent a significant amount of time working at is Whole Foods Market, in their corporate office. While both Apple and Whole Foods always are selected as two of the top companies to work for by Forbes in their annual report, as far as benefits went, Apple's were far superior in most aspects. With respect to company culture, I personally found Whole Foods to be better, but that was sort of a personal preference. Both were dream jobs, and I consider myself very fortunate to have had the opportunity to work for two outstanding companies that both treated me very well.  Oh- and incidentally, Ron Johnson, who was VP of Retail at Apple from the inception of the stores until like a year ago, now is CEO of JC Penny, and, I suspect, is fully behind JCP's ad campaigns which include images of families with same-sex parents. JCP has stepped deliberately and full-on into what is, unfortunately, still a controversial topic and has taken a firm stand in support of all types of loving families. I have to wonder if part of this might have been inspired by the fact that Apple's new CEO, Tim Cook, is gay. Ron Johnson would have worked closely alongside Cook during his tenure. I met Ron once and found him to be a great guy, and I worked with the Retail operations folks from the time the stores launched. They were a great team that worked hard and were very sincere and dedicated. You could see his leadership reflecting in each member of the team." This is not right. Inferring the employee stock pool’s takeaway is not as easy as just taking a fraction of the purchase price. As an example, that wouldn’t account for any preferred returns of other ownership classes, among other things.   All considered though, it’s reasonable to assume that the employee stock pool will get some premium. Best of luck. Cat has always had plants in IL. HQ is in Peoria (grew up there, several members of my family work for them), and plants all over the place. Canada probably had other things going against it at the time they pulled out. Depending on the timing, it's quite likely that the exchange rate had shifted such that, even without a raise, the workers were effectively costing the company considerably more.  Articles like that seem to leave out all sorts of details. For instance, I only saw one point where salary was increased and it wasn't anywhere near a 60% increase - more like 15% which isn't entirely unheard of. There's also what looks like a one time cash payment - bonus for a good year. 3-4x salary isn't unheard of in executive bonus land. It's also highly variable and not guaranteed year to year. The rest would be in stocks and options. The trick there is that the amounts of those were probably determined when he signed his contract. The reason it makes for a big raise is because the stock price has gone up (though it's down nearly 20% over the last month - May kinda sucked for the stock market).  You also need to look at whether the profits are higher because of higher volume (and possibly more workers), better margins, better deployment of capital, etc. And when there's talk about asking worker to pay more for their health care, is it more as a raw dollar amount, or more as a percentage of the health care costs. As to whacking defined benefit pensions -- personally, I'd rather have a 401k. The problem with defined benefit pensions is that you're tied to that company for life. Put in your 40 years and then retire with 80% pay or whatever it is. Leave after 4 or 5 and you've pretty much got nothing - with a 401k, leave after 4 or 5 and you have what you've put away + what the company matched. "All things being equal, a defined benefit pension is far better than an IRA or a 401(k).  Think about it this way - let's say you can have a guaranteed $100 a month*, or the chance at $100 a month.  Which is better?   Now, obviously, your tolerance for risk is the difference - but this is the beauty of a defined benefit plan. Your employer is picking up the risk.  Assuming that the pool of investments is about the same (which unless if their funds are tremendously under performing they are), the question is, who takes the risk - you or them? Especially if you are moving into a new position, having a defined benefit plan is like having a risk-free asset in your portfolio.  It increases your safety.  The only reason to roll this over into a 401(k) or IRA is if your expected value (risk * payout) is better.  A worked example. If half the time you would earn more than $100 and half the time less, then you could imagine the two as being equally good. Only if you really love risk would you take that chance.  In reality, only half the investments out there will ""beat"" the average, and as such, you actually have less than a 50/50 shot of beating a DB - unless if there are really low returns to it.  More likely, I suspect you are over-estimating your ability to get a higher return." "While the other answers try to quantify the value of health care the question you ask is about employee vs contractor. The delta between those regarding benefits goes way beyond health care. In fact because almost every full time employee must have health care offered by their employer the option of  ""you can have X with healthcare, or Y with no healthcare"" is no longer an option. I have seen situations in the last few years where employees who had no need for healthcare coverage (retired military) were offered additional vacation days to compensate for their lower cost to the employer. For employee vs contractor what is different isn't just healthcare. It also includes holidays, vacation days, sick days, employer portion of social security, education benefits, and 401k. Insurance benefits include not just healthcare but also dental, vision, short term and long term disability, and life insurance. The rule of thumb to cover all these benefits that are lost when you are a contractor is an amount equal to your income. Of course some of these benefits  depend on single vs married and kids or not. But unless the rate they are paying the contractors is approaching twice the rate they are paying employees the contractor will be hard pressed to cover the missing benefits." There is some magic involved in that calculation, because what health insurance is worth to you is not necessarily the same it is worth for the employer. Two examples that illustrate the extreme ends of the spectrum: let's say you or a family member have a chronic or a serious illness, especially if it is a preexisting condition - for instance, cancer. In that case, health insurance can be worth literally millions of dollars to you. Even if you are a diabetic, the value of health insurance can be substantial. Sometimes, it could even make financial sense in that case to accept a very low-paying job. On the other extreme of the scale, if you are very young and healthy, many people decide to forego insurance. In that case, the value of health insurance can be as little as the penalty (usually, 2% of your taxable income, I believe). "Not if they're unfunded and the company goes under, they don't.  And more accurately, defined benefit plans have (perceived) value only to people who don't have the first clue how to soundly invest their own retirement funds - Which admittedly means ""almost everyone"".  But TANSTAAFL - Even the rare pension plan that is fully funded and soundly invested will *still* tend to underpeform the market as a whole.  If you really want to lock in a sub-5% return, just sink your entire retirement into whole-life annuities and you can gleefully call it a ""pension""." I agree that to take the money from the defined benefit plan you are saying that you can get a better return than the plan. You are taking all the risk if you take the lump sum. But there are two more risks that you are taking by keeping the money in the plan even though you are decades from retirement. Funding risk: companies and state/city/county governments have underfunded their pension programs due to budget pressure. In some cases they have skipped payments when the market was good, because they felt they were ahead of their obligations. They also delayed or skipped contributions when they had a budget shortfall, and wanted to not end the government/company fiscal year in the red. The risk is that they can get so far behind that they change their promises to current and former employees. This was one of the issues with the city of Detroit this year. Bankruptcy: even though their are guarantees regarding pension benefits, the Pension Benefit Guaranty Corporation does set a maximum benefit. If the company goes bankrupt or the plan is terminated  you might not get all the money you were expecting. While the chances of taking a haircut generally impacts people who have a long career, because they are entitled to a large benefit, it can impact people who don't expect it. As others have pointed out, post-tax dollars are what you'll use.  Just as a quick note, as you'll be using post-tax dollars; in the past, I've refused to take contractor plans because they almost always are inferior to what I've been able to get off the private exchange ehealthinsurance.  A few people have written excellent articles on Get Rich Slowly here and here about them in detail if you want more information. Generally, contractors (and sometimes employees) are offered a few plans (3-4), and this health exchange gives you a little more freedom to pick your plan, which in your situation may help.  It isn't always cheaper, but depending on your needs, you may obtain a better deal. Forgot to add this: this option has also made switching jobs easy as well since I don't have to pay COBRA.  While it depends on the situation, this can sometimes come out significantly cheaper.  For instance, if I were to take the employer health plan next year, I would lose ~$450 a month, whereas the private exchange option is ~$300.  But, if I were to switch jobs, decide to opt for self-employment, or a layoff, the COBRA would be even higher than ~$450. "I don't understand the worker mentality of accepting to be part of pension plans. The downside risk to you is ridiculously high -- you're basically making an investment that the next 30 years of corporate management and the company as a whole are going to be good. Pension plans are among the first to go.. employees that retired 20-30 years ago add no current value to the company, unless you consider that current employees are motivated by the idea of a pension or working for a company that ""takes care"" of its employees.  Also, part of the reason pension funds are blowing up is that the risk-free return rate is less than 1%. I don't know who to blame or thank for that, but with government bonds now trading at negative yields in real and sometimes even absolute terms (see: Swiss yields), what else are you supposed to do?" I've had stock options at two different jobs.   If you are not getting a significant ownership stake, but rather just a portion of options as incentive to come work there, I would value them at $0.    If you get the same salary and benefits, but no stock options at another company and you like the other company better, I'd go to the other company. I say this because there are so many legal changes that seem to take value from you that you might as well not consider the options in your debate. That being said, the most important question I'd want to know is what incentive does the company have to going public or getting bought?    If the company is majority owned by investors, the stock options are likely to be worth something if you wait long enough.   You are essentially following someone else's bet.    If the company is owned by 2 or 3 individuals who want to make lots of money, they may or may not decide to sell or go public. "Pretty simple actually. This is a state-run defined benefit plan, where the benefit is calculated based on the length of the employment and the contributed amounts. This is what in the US is known as the Social Security.  This is a defined contribution plan, where the employee can chose the level of risk based on certain pre-defined investment guidelines (more conservative or more aggressive). In Poland, it appears that there's a certain amount of the state-mandated SS tax is transferred to these plans. Nothing in the US is like that, but you can see it as a mandatory IRA with a preset limited choice of mutual funds to invest into, as an analogy. The recent change was to reduce the portion of the madatory contribution that is diverted to this plan from 7+% to 2.3% (on account of expanding the contribution to (1)). Probably the recent crashes of the stock markets that affected these accounts lead to this decision. This is voluntary defined contribution plan, similar to the US 401Ks. This division is actually pretty common, not unique to Poland. I'd say its the ""standard"" pension scheme, as opposed to what we're used to in the US." First let's define some terms. Your accrued benefit is a monthly benefit payable at your normal retirement age (usually 65). It is usually a life-only benefit but may have a number of years guaranteed or may have a survivor piece. It is defined by a plan formula (ie, it is a defined benefit). A lump sum is how much that accrued benefit is worth right now. Lump sums are based on applicable interest rates and mortality tables specified by the IRS (interest rates are released monthly, mortality annually). Your plan can either use the same interest rates for a whole year, or they can use new ones each month. Affecting your lump sum is whether your accrued benefit is payable now (immediately, you are age 65), or later (deferred, you are now age 30). For example, instead of being paid an annuity assume you are paid just one payment of $1,000 on your 65th birthday. The lump sum of that for a 65 year old would be $1,000 since there would be no interest discount, and no chance of dying before payment. For a 30 year old, at 4% interest the lump sum would be about $237 (including mortality discount). At age 36 the lump sum is $246. So the lump sum will get bigger just because you get older. Very important is the interest discount. At age 30 in the example, 2% interest would produce a $467 lump sum. And at 6% $122. The bigger the rate, the smaller the lump sum because interest helps an amount now grow bigger in the future. To complicate things, since 2008 the IRS bases lump sums on 3 different interest rates. The monthy annuity payments made within 5 years of the lump sum date use the 1st rate, past 5 and within 20 years use the 2nd rate, and past that use the 3rd rate. Since you are age 30, all of your monthly annuity payments would be made after 20 years, so that makes it simple since we'll only have to look at the 3rd rate. When you reach age 45 the 2nd rate will kick in. Here is the table of interest rates published by the IRS: http://www.irs.gov/Retirement-Plans/Minimum-Present-Value-Segment-Rates You'll find your rates above on the 2013 line for Aug-12. That means your lump sum is being made in 2013 and it is being based on the month August 2012. Most likely your plan will use the same rates for its entire plan year. But what is your plan year? If it is the calendar year, then you would have a 5 month lookback for the rates. But if is a September to August plan year with a 1 month lookback, the rates would have changed between August and September. Your August lump sum would be based on 4.52%, your September on would be based on 5.58% (see the All line for Aug-13). For comparison, a 30 year old with a $100 annuity payable at age 65 would have a lump sum value of $3,011 at 4.52%, but a lump sum value of $1,931 at 5.58%. The change in your accrued benefit by month will obviously have some impact on the lump sum value, but not as much as the change in interest rates if there is one. The amount they actually contribute to the plan has nothing to do with the value of the lump sum though. Note the above is only for shares. There are different rules for other assets like House, Jewellery, Mutual Funds, Debt Funds. Refer to the Income Tax guide for more details.