Comparing Job Offers 1.1.3

Comparing Job Offers 1.1.3Take Charge of Your FinancesFamily Economics and Financial Education

Changes on Slides 4, 61Congratulations!Sara just graduated from college with a teaching degree and received two job offers. Which is the best deal?

Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Job Offer 1$35,000.00 in Reno, NV

Job Offer 2$40,000.00 in Anchorage, AK

Not enough information to decide

Which option is best?Which is the better deal? Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Added option C because there is not enough information especially on cost of living so it would be an uninformed decision.3Comparing Job Offers Questions that you should ask you are interviewing the company just as they are interviewing you:

Base SalaryDollar amount a person will receive in his/her monthly paycheck before taxes. Based upon supply and demand.

**Does it pay enough?**Cost of LivingFringe BenefitsPaid sick timeHolidays and vacation timeBonuses Health and life insuranceWorkmans compensationRetirement contributions

Opportunity for Advancement & Other Work IncentivesRaised based on performance Guaranteed pay raise based on longevity Furthering Education pay or position advancementsAdditional perksRelocation allowances Company car Repayment of education loans Help further educationStock optionsGym membership Flexible hours Merchandise discounts Child careTelecommuting

Location and EnvironmentWorking conditionsCommute time Affordable housingLow crime rate Good schools Desired climate

Values, Goals, Needs, and Wants Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Cost of LivingCost of living includes housing, food, transportation, and other everyday expenses.Rural communities often have a lower cost of living than urban communities.A person making $50,000 in Salt Lake City may have just as much buying power as a person making $100,000 in another city.Index form rates communities on a scale of 100.0 and gives an average cost community a rating of 100.0.A lower index means a lower cost of living.A higher index means a higher cost of living.

Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1YOUR JOB OFFERYou have been offered a job with a reputable nation-wide company in your field.Pay $55,000 a year$4,600 a month (avg national entry level salary)Choose any of their 8 locations to move to and work from.Visit 3 states around the room. Choose 3 states you would considerMake note of expenses in relation to your salaryRemember: $4,600 also needs to cover expenses like insurance, car payments, taxes, groceries, gas,. Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Cost of Living EquationRound dollar amounts to two decimal places

Salary in city 1 x Cost of Living Index of City 2 Cost of Living Index of City 1= Equivalent Salary in city 2 Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Cost of Living EquationIn order to compare the cost of living in two cities always follow these three steps: Step 1: Assign each cities numbers. One city will be assigned the number one and the other the number two. Step 2: Provide the corresponding salaries and index amounts. Step 3: Complete the math and indicate which city is a better offer and why. Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Saras Job OffersJob Offer 1 Reno, NV$35,000.00 salary105.1 cost of living indexJob Offer 2 Anchorage, AK$40,000.00 salary123.1 cost of living index Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Saras Cost of Living Equations$35,000.00 in Reno x 123.1105.1= Equivalent Salary in Anchorage$40,000.00 in Anchorage x 105.1123.1= Equivalent Salary in RenoOption 1 or Option 2 Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Saras Cost of Living Equations$35,000.00 x 1.1712654 =$40,994.29 = Equivalent salary in Anchorage

$40,000.00 x .8537774 =$34,151.35 = Equivalent salary in Reno

Option 1 or Option 2 Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Saras Job OutcomeA person earning $35,000.00 in Reno must earn $40,994.29 in Anchorage to have the same spending power. Or A person earning $40,000.00 in Anchorage must earn $34,151.35 in Reno to have the same spending power. Therefore, the salary offer in Reno is better by $994.29 ($40,994.29 - $40,000.00).Explain why moving to a place where your salary doubles may not really double your buying power.

Job Offer 1$ 35,000.00 in Reno, NVJob Offer 2$40,000.00 in Anchorage, AK Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Joes OffersJob Offer 1- Denver, CO $24,000.00 salary102.9 cost of living indexJob Offer 2 - Seattle, WA $32,000.00 salary148.2 cost of living index

Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Joes Cost of Living Equations$24,000.00 in Denver x 148.2102.9= Equivalent salary in Seattle$32,000.00 in Seattle x 102.9148.2= Equivalent salary in DenverOption 1 or Option 2 Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Joes Cost of Living Equations$24,000.00 x 1.4402332 = $34,565.60 = Equivalent salary in Seattle

$32,000.00 x .6943319 = $22,218.62 = Equivalent salary in Denver

Option 1 or Option 2 Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Joes Job OutcomeA person earning $24,000.00 in Denver must earn $34,565.60 in Seattle to have the same spending power. Or A person earning $32,000.00 in Seattle must earn $22,218.62 in Denver to have the same spending power. Therefore, the salary offer in Denver is better by $2,565.60 ($34,565.60 - $32,000.00).

Job Offer 1$24,000.00 in Denver, COJob Offer 2$34,565.60 in Seattle, WA Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G12. Benefits of school?

Benefits Job offer?

Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

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7-K-1Typical Employee BenefitsHospitalization, Medical, and Disability Insurance Dental and Vision InsuranceAccidental Death InsuranceSick LeavePaid Vacation Time and HolidaysParental LeaveMore Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

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7-K-2Typical Employee BenefitsWorkers Compensation InsuranceLife InsuranceRetirement BenefitsRetirement Savings PlansEmployee Assistance Programs

2 of 2 Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Employee benefits pay almost 1/3 (33%) of full-time employee compensation. Furthermore, many employee benefits are non-taxable so your taxes are reduced.EMPLOYEE BENEFITS Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Pays for doctors, prescriptions, hospitals, exams, and dental work.HEALTH INSURANCE Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Replaces some of your income if you are unable to work for extended periods of time due to accident or illness. It pays the money directly to YOU.DISABILITY INSURANCE Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Pays others who depend on your income if you die.LIFE INSURANCE Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Helps you save for retirement. Employers often contribute additional money for your retirement when you contribute. It is free money!RETIREMENT BENEFITS Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Help pay education costs while you work.EDUCATION BENEFITS Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1The most common employee benefits offered by small business to full-time staff with at least 1 year of service are: COMMON EMPLOYEE BENEFITS Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Paid Vacations: Offered by 75% of small businesses.Employee Health Insurance Plan: 61%Paid Sick Leave: 59%Disability Insurance: 41%Education Reimbursement for Job: 39%Pension Plan: 30%Life Insurance: 29%Dental Insurance: 24%COMMON EMPLOYEE BENEFITS Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Offering employee benefits provides many paybacks to your small business. Number one is staff retention. An attractive employee benefit package will help recruit good employees and retain them as well. In addition, staff retention helps reduce turnover.WHY GIVE BENEFITS? Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1EIGHT UNCOMMON EMPLOYEE BENEFITSProvide your staff with the option of having their checks directly deposited into their bank account at any bank or credit union. This makes saving automatic.DIRECT DEPOSIT Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1With the rising costs of health care, both employers and employees can take responsibility for the health system by participating in a wellness plan. Any form of fitness programs, smoking cessation, and stress reduction can improve employee absenteeism and overall productivity.WELLNESS PROGRAM Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1An overlooked employee benefit to staff is the chance to buy company products or services at discount. Even if its only one major item or an employee purchase day, your staff will appreciate this benefit.COMPANY DISCOUNTS Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Depending on employee commuting needs, parking privileges can cover payment of a monthly city transit pass or paying an amount of pre-tax payroll dollars for vehicle parking.PARKING PRIVILEGES Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Business cards with an employees name and title will offer an emotional appeal to staff. It may seem trivial, but your staff will enjoy the level of professionalism and pride that comes from having a business card.BUSINESS CARDS & TITLE Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Many employees will value the ability to buy a computer interest-free. Determine a limit of the dollar value of the computer on the plan. Set up an automatic payroll deduction. Make sure a formal agreement is signed in case the employee leaves the company.COMPUTER LOAN INTEREST FREE Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Offer your employees a limit of regular pay hours in community service time. If a staff member wants to be involved in a volunteer event, have the company pick up the tab. You will win the hearts of staff and community.COMMUNITY HOURS Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1There is no doubt todays work force requires lifelong learning to keep pace with the changing demand of employment. Your small company may not be able to pay the tuition costs of an MBA program, but some community college course reimbursement is affordable.EDUCATION PLAN Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Comparing Job offer and considering benefitsFringe benefits and employer provided services can make a difference:For example, if a $35,000.00 job had 100% of medical insurance coverage valuing $400.00 per month, a person would not have to budget for $4,800.00 in medical insurance per year. This would increase the value of his or her salary to $39,800.00.Benefits and services should be included within the salary before calculating the cost of living.

Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Saras Job including benefit packageJob Offer 1 Reno, NV$35,000.00 salary + $4,800.00 benefits = $39,800.00105.1 cost of living indexJob Offer 2 Anchorage, AK$40,000.00 salary + $5,200.00 benefits = $45,200.00123.1 cost of living index Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Saras Job including benefit package$39,800.00 in Reno x 123.1105.1= Equivalent salary in Anchorage$45,200.00 in Anchorage x 105.1123.1= Equivalent salary in RenoOption 1 or Option 2 Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Saras Job including benefit package$39,800.00 x 1.1712654 = $46,616.36 = Equivalent salary in Anchorage

$45,200.00 x .8537774 = $38,590.74 = Equivalent salary in Reno

Option 1 or Option 2 Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Saras Job Outcome including benefit packageA person earning $39,800.00 in Reno must earn $46,566.00 in Anchorage to have the same spending power.-Or A person earning $45,200.00 in Anchorage must earn $38,590.74 in Reno to have the same spending power.Therefore, with the benefits package included, the job offer in Reno is higher.

Job Offer 1 $39,800.00 (with benefits) in Reno, NVJob Offer 2 $45,200.00 (with benefits) in Anchorage, AK Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Joes Job including benefit packageJob offer 1 - Denver, CO$24,000.00 salary + $4,500.00 benefits =$28,500.00102.9 cost of living indexJob offer 2 - Seattle, WA$32,000.00 salary +$6,000.00 benefits = $38,000.00148.2 cost of living index

Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Joes Job including benefit package$28,500.00 in Denver x 148.2102.9= Equivalent salary in Seattle$38,000.00 in Seattle x 102.9148.2= Equivalent salary in DenverOption 1 or Option 2 Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Joes Job including benefit package$28,500.00 x 1.4402332 = $41,046.65 = Equivalent salary in Seattle

$38,000.00 x .6943319 = $26,384.61 = Equivalent salary in Denver

Option 1 or Option 2 Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Joes Job Outcome including benefit packageA person earning $28,500.00 in Denver must earn $41,046.65 in Seattle to have the same spending power.Or A person earning $38,000.00 in Seattle must earn $26,384.61 in Denver to have the same spending power.

Therefore, with the benefits package included, the job offer in Denver is higher.

Job Offer 1 $28,500.00(with benefits) in Denver, COJob Offer 2 $38,000.00(with benefits) in Seattle, WA

Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Back to your job offerWhich job location will provide the best of cost of living?Complete the crossword puzzle.

Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

1.1.3.G1Additional Web sitesWeb sites available to help calculate salaries and cost of living in various locationswww.homefair.com www.bankrate.com/brm/movecalc.asp Family Economics & Financial Education Revised May 2009 Career Development Unit Comparing Job Offers Slide # Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

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