How to Calculate Benefits
Look up the value of your employer's contribution to health insurance., Calculate the value of other insurance available as part of your compensation package., Check the benefit value for retirement contributions, including any fund matching., Add...
Step-by-Step Guide
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Step 1: Look up the value of your employer's contribution to health insurance.
This may include not just the raw cost, but also the difference between how much your coverage costs the company and how much it would cost you to get the same coverage.
This alone can represent the majority of value when you calculate benefits. -
Step 2: Calculate the value of other insurance available as part of your compensation package.
Some examples include vision, dental, long-term disability, short-term disability and life insurance.
Although the individual cost of these benefits is often relatively low, the value comes from the often sharply discounted rates as compared to buying these policies as an individual. , If working this out to determine actual costs or value, use matching for funds that were actually contributed and not the maximum matching you actually did. ,, These might include deposits into a flexible or health spending account, the cost of professional licenses, education expenses and child care expenses.
Some companies also reimburse the cost of parking or a gym membership. , This can be tricky, as the real value often isn't clear until the stock is sold years later. , If this amount varies considerably, take an average of recent payments. ,,, If you're not sure, check with your accountant or tax lawyer. ,, Add these tax costs, and calculate the benefits value for this third category of benefit. , -
Step 3: Check the benefit value for retirement contributions
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Step 4: including any fund matching.
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Step 5: Add up the total number of hours or days of paid leave permitted per year
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Step 6: and multiply that by the hourly or daily pay scale for the position.
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Step 7: List any expenses reimbursed by your company as part of the benefits package.
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Step 8: Calculate benefit value for any employee stock purchase plans or similar vehicles.
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Step 9: Add up any additional compensation such as bonuses and commissions.
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Step 10: Divide the results into two different lists: those paid for with pre-tax dollars and those paid for with post-tax dollars.
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Step 11: Total the value of all benefits paid for with post-tax dollars.
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Step 12: Determine which pre-tax benefits in your compensation package receive a tax credit if purchased by a private citizen.
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Step 13: Total the value of all benefits that would be paid for under a tax credit.
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Step 14: Estimate the tax cost of each benefit that is paid for with taxable income if you purchase it as an individual.
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Step 15: Add up the total of all three categories in your compensation package.
Detailed Guide
This may include not just the raw cost, but also the difference between how much your coverage costs the company and how much it would cost you to get the same coverage.
This alone can represent the majority of value when you calculate benefits.
Some examples include vision, dental, long-term disability, short-term disability and life insurance.
Although the individual cost of these benefits is often relatively low, the value comes from the often sharply discounted rates as compared to buying these policies as an individual. , If working this out to determine actual costs or value, use matching for funds that were actually contributed and not the maximum matching you actually did. ,, These might include deposits into a flexible or health spending account, the cost of professional licenses, education expenses and child care expenses.
Some companies also reimburse the cost of parking or a gym membership. , This can be tricky, as the real value often isn't clear until the stock is sold years later. , If this amount varies considerably, take an average of recent payments. ,,, If you're not sure, check with your accountant or tax lawyer. ,, Add these tax costs, and calculate the benefits value for this third category of benefit. ,
About the Author
Anna Allen
Professional writer focused on creating easy-to-follow pet care tutorials.
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