By Roberto Angulo

Part of Getting Your First Job For Dummies Cheat Sheet

When you get a job offer, you need to evaluate it to see if it’s right for you. Here are some questions to ask yourself about each offer you get. If you get multiple offers at the same time, you can compare them side by side, decide which factors are important to you, and choose the best package.

  • What is my total cash compensation? Look not only at your base salary but also any potential bonuses you may receive. If you’re confident you’ll earn your bonuses and you have a good idea of how likely it is that the employer will pay out bonuses, factor this in to your cash compensation and total them up.
  • What percentage of employees earn their bonus? This is a great question to ask a potential employer to get an idea of how realistic it is that you’ll actually earn your bonus. This question applies to annual or quarlerly bonuses and to individual and company-wide bonuses, too. If you want to calculate your expected bonus, multiply your potential bonus payout times the percentage probability of getting the bonus. For example, if you can earn an annual bonus of $10,000 and people earn it half the time, then multiply the $10,000 times 50 percent to get an expected bonus of $5,000.
  • What are the retirement benefits? It’s never too soon to start thinking about retirement or saving money. If your employer offers a 401(k) or similar plan, this can help you save at a faster rate by stashing away pre-tax dollars. Many employers also provide matching, which is as good as cash that you can use upon retirement.
  • Does the employer offer stock or stock options? Stock in a public company is usually as good as cash, and it has the potential to grow in value. Factor in this perk if you’re offered stock. Stock options in a private company are harder to value. In most cases, they end up being worth nothing, and in other instances, they can be worth a lot of money.
  • Do I get health benefits? If so, how much are they and what is the deductible? Employers often offer health insurance coupled with vision and dental benefits. Even if you’re a healthy individual, it’s good to have insurance. You never know when you’ll need it. If you have a spouse or family, employer-provided health insurance may cost you less than getting it on your own. Find out what’s covered and how much you need to pay each month for yourself and your family. Employers often make employees pay a portion of the monthly health insurance premium. You should also know the annual deductible (how much you have to pay out of pocket before the insurance starts kicking in). If your deductible is zero, this is ideal because it means your insurance starts covering expenses as soon as you’re insured. On the other hand, if your deductible is, say, $5,000, you need to pay for the first $5,000 of medical expenses out of pocket before your insurance starts covering medical costs.
  • Will I have work–life balance and flexibility? New job seekers see this as a huge benefit. Being able to work from home one day a week may be a valuable perk for you. The same goes for vacation or paid time off (PTO). If you value your time, assign the appropriate value to this benefit. Company culture is also important. Does the employer foster a cutthroat work environment or one that nurtures its employees?
  • What makes the employer unique? An employer’s brand name can add to your résumé and help you get a better job down the line. Do they offer training? These are factors that can are also valuable and can outweigh any cash compensation.

You can create a spreadsheet listing each offer you’ve received, starting with the employer name and then for each column, adding a benefit that’s important to you as shown in the figure. You can assign a weight to each perk, and then total the points, to see which offer comes out on top.