How Much Do You Make?

Seems like a pretty straight-forward question.  If you are thinking about going to work for another company, you might just compare the salaries, the one you currently have versus the one with the prospective employer.  By comparing only this number, you could end up with less overall earnings.  You need to take into account your total compensation, which includes more than just your salary.

Cash Compensation

This one is the easy one.  In my case, I have a base salary and receive bi-monthly paychecks.  I like this because it makes my budgeting easier and more predictable.  What if I am thinking about working for a company that pays every two weeks, for the same salary?  I would actually see my monthly pay decrease for 10 out of 12 months.  The reason is bi-monthly means 24 paychecks a year, bi-weekly means 26 paychecks a year.  The bi-weekly paychecks are smaller, but you receive 2 more of them.

 

The other thing to consider is whether you are eligible for any bonus programs.  With my current company, I have received bonuses ranging from $5,000 to $15,000.  By switching companies, are you foregoing the chance to earn a bonus?

Health Benefits

Health benefits can be a large part of your overall compensation.  Here are some things to consider.  First, does your employer even offer any kind of benefits?  Second, does your employer subsidize any portion of the premium?  I am lucky enough to work for a company that offers a full range of health benefits and subsidizes some of the cost.  I am signed up for health insurance, dental insurance, short and long-term disability insurance, and the company provides basic life insurance.  The total cost of all the benefits is almost $15,000 for my family of four.  The company subsidizes two-thirds of that cost, or about $10,000.  If I switch companies, do I end up having to pay more for my benefits?  It is a question you need to ask, so that you do not end up with less in your pocket.

Retirement Benefits

This is another area in which you could lose money by switching companies if you are not paying attention.  Again, the company for which I work for offers a 401k plan.  They also offer a match of 100% of contributions up to 6%.  In addition to this, they contribute 1.5% automatically whether you contribute to the plan or not.  So, I naturally contribute to the plan at least 6% and receive 7.5% from the company.  That could potentially be a lot of money if I switched companies.  With a company match, do they match on bonuses or overtime?  My company recently changed the plan to start matching on the annual bonus.  Does your current company have a pension or retirement plan?  How much do they contribute?

Company Perks

Some other things that may not seem that obvious, but that you should consider are things such as free parking, a gym or gym membership, or a subsidized or free cafeteria.  I currently enjoy free parking and a free in-house gym.  If I had to estimate an annual cost for both of those benefits, it would be about $1,500 a year, though it is unlikely I would pay for a gym membership, so maybe $1,200 a year.  Again, that is not an insignificant amount.  If I switched companies and had to pay for parking, I might cost myself money overall.

Compare Apples-to-Apples

It is a lot to consider.  The easiest way I know how to do it is simply make a list.  You just want to make sure that you do not end up being compensated less overall if you make a change.  Otherwise you might find yourself a little lighter in the wallet.

4 thoughts on “How Much Do You Make?

  • June 3, 2013 at 12:24 pm
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    Krantcents – Depends on the job you are comparing to it. If you’re comparing to a similar teaching job, vacation and time off are probably awash. However, if you’re comparing it to a regular 40/hr a week, 52/weeks a year job, then I would compute your hourly rate. For example, I used $105,000 as total earnings. I then divided by your 1,224 hours worked. That gives me an hourly rate of $85.78. Translating that into earning for a 40/hr a week, 52 weeks a year job would equate to $178,422. So, to earn a comparable about, the other job would have to have a total compensation greater than $178,422 to be equivalent. The harder question would be the emotional factor of having to work more, would it be worth it?

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  • June 3, 2013 at 12:13 pm
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    If I include all of those items, I make over $100K. Not bad for a teacher who works 1,224 hours a year. How do I quantify all the time off and vacations?

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  • June 7, 2013 at 10:03 pm
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    Hmmm…self-employment is not nearly as hard to figure out, lol. We make about $130,000 a year and we then pay for taxes and everything else from there. 🙂

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  • June 10, 2013 at 5:58 am
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    Yeah, as the boss, you just have to figure out what perks you want to give yourself. 🙂

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