How To Select Benefits At Your New Job

You've just gotten a new job. Yay! But now you have to pick out benefits at the new job. Yikes! Our guide to the (often) overwhelming options.

Getting a new job is both exciting and nerve-wracking. Maybe it's your first job, or maybe you've upgraded to a better job. Regardless, you're probably balancing the excitement of your new salary with the stress of meeting new performance expectations.

That said, the last thing you probably want to think about is choosing your benefits. Yet you're required to make crucial decisions that affect you for the next year within the first 30 days of employment. To make life easier on you, we've put together a simple benefits guide to help you choose your benefits appropriately at that new job.

Health-related benefits

Medical

Medical Insurance is a must-have with your new benefits package. That is unless you're getting them through a spouse or significant other. If not, this is usually the first thing you'll sign up for, and it's pretty easy to get confused by the various offerings.

The two major types of medical insurance you'll typically be offered, and have to pick between, are a PPO (Preferred Provider Option) and a HMO (Health Maintenance Organization). The easiest way to explain the difference is by level of flexibility.

With a HMO, you are able to see physicians that are preselected by the insurance company, usually because they already have contracts with them. It's often cheaper, but your options can be limited as to which doctors you're able to see.

A PPO, on the other hand, is more flexible, and you aren't restricted to specific doctors chosen by the insurance company. The insurance company still has some type of relationship with the physician of their practice, but there may be fewer restrictions.

The other thing to consider is the deductible you'll pay. Sometimes you'll have a choice, but many companies now will automatically put you into a high-deductible plan.

The benefit of a high-deductible plan is that it's a lower monthly premium, but the downside is that you'll pay more out-of-pocket before insurance kicks in. You may also have to pay an additional premium for your insurance-eligible spouse to join your plan. Companies do this to keep costs down, so it might be more beneficial for you and your spouse to be on your own separate plans with your individuals companies.

Dental

With dental insurance, you'll often get the option of a PPO and HMO, as mentioned above dental insurance covers preventative care, like semi-annual teeth cleanings for example. It may also cover portions of bigger procedures, such as root canals, braces, and crowns.

Make sure you fully understand what's covered and what isn't. If you're someone who doesn't have a lot of dental issues and you don't often need things like crowns or root canals, it may actually cost you more in the long-run to pay for better dental insurance.

If you have young children, you'll also need to consider their current or future needs, like getting braces. In this case it might make sense to pay more for a dental plan that covers a portion of these types of expenses.

Vision

The Employee Benefit Research Institute (EBRI) recently found that only 60 percent of organizations offer vision insurance. While this is a nice benefit to have, not everyone needs it.

Typically if vision insurance is offered, you'll only get one option. It's normally not expensive, and the primary purpose is to cover routine/preventive eye exams and a portion of the cost of contacts and/or glasses. Read the details carefully, though, because most vision plans will only cover up to a specific dollar amount on contacts or glasses (and it's usually one or the other).

Life Insurance

Most companies will provide you life insurance equal to your annual pay included in your benefits. To get more coverage (i.e. two to three times your annual salary) as coverage, you'll typically need to pay a higher premium.

Another caveat is getting a physical exam. Depending on your company, you may need to have a physical exam, blood work, and other health related tests done in order to qualify for a certain level of life insurance.

Many times it's cheaper to buy life insurance outside of your benefits, and you have more options. The two most common types of life insurance are whole life and term life -- and you can read about them both in our breakdown.

Financial Benefits

401(k)

Nearly every company should offer a 401k retirement plan (or 403(b) if they're a nonprofit). If they don't, they'd better offer some extraordinary other benefits that you simply can't pass up. A retirement savings plan like a 401(k) is the foundation of a secure financial future. It's important to know that you'll have options to save.

Since most employers offer a retirement savings account, the biggest thing you'll need to look for is the employer match. As a benefit, most companies will offer to match your contribution to your retirement savings, up to a certain amount -- usually a percentage.

For example, say your company matches dollar-for-dollar up to 5 percent of your contributions. That means for every dollar you contribute to your retirement savings, up to 5 percent, you're getting the company to give you an extra dollar. That's free money, people!

Lifestyle Benefits  

Vacation Time

This one is pretty self explanatory, but you'll want a full understanding of your vacation time when joining an organization. Here are a few questions to ask or consider:

• Can I use my vacation time prior to earning it, or do I have to accrue the hours before using it? Some organizations will only let you use the hours you've earned, and some will let you "borrow" hours early in the year to take vacation time.
• Does any unused vacation time roll over into the next year? Important if you're taking a big vacation, having a baby, or just not someone who uses a lot of vacation
• Can I purchase additional vacation time? Very important if you are someone who values time off more than other benefits. One company I worked for let me buy an extra week of vacation which equated to taking a week off, unpaid, when it was all said and done. It was well worth it.

Holidays

You'll almost always get national holidays off, such as Thanksgiving and Christmas (unless you're in something like the medical field or work for Disney World, which are open 365 days a year.) The key is to see what additional holidays you get, and how they're used.

For example, if you work in financial industry, you'll get bank holidays, which gives you an extra few days off every year. But holidays might count against your total vacation time, especially if the company uses PTO (more on that below).

Personal and sick time

Along with vacation and holidays comes things like sick and personal time off. Know exactly how many days you're given, if you're given any at all, in advance so you can plan your year accordingly. If you're someone who always get sick and you don't get any sick time (i.e. you have to use vacation or a personal day), you might not want to plan any major trips.

You may also be given a couple of personal days, which can be used for anything, and often with little notice. These are typically reserved for emergencies that you can't plan for.

Other benefits

Aside from all of the more common benefits, there are quite a few that are often overlooked. Here are some of best benefits that your recruiter or Human Resources department may not initially cover with you:

• Wellness. More than half of American workers now have access to some type of corporate wellness program, which include things gym memberships, weight loss programs, and discounts on health insurance for being healthy.
• Career development. Perks like tuition reimbursement are becoming more and more common, as employees look to grow themselves professionally. Check into your benefits package to see what kind of internal development options you have, such as formal mentoring program or leadership development classes.
• Commuter benefits. If you're working the city center, your company might reimburse you for taking the subway or even help you pay for parking. If this isn't already included in your benefits package and you are going to be spending significant money on commuting, I recommend you ask about some type of commuter benefit being included in your package.