Cost is just one aspect of the benefits package you receive through your employer. You can find out more about what’s offered and how you can use benefits for practical help in your daily life.
Quick takeaways
Let’s say you have a full-time job with some sort of benefits package, but you’re not quite sure what’s included or how much it might cost, and you might have missed out on a benefit, too. You’re not alone: When it comes to benefits, about a third of people say they are hard to understand. For those with voluntary benefits, only half take advantage of them.
There’s help for you to understand the value and types of benefits, enrollment dates, and costs for either you or your employer. Knowing some basics (and asking a few questions) can help you get more from your job and your benefits.
Some benefits are mandated based on a business’s number of employees. Some are simply benefits a business has chosen to offer. Benefits packages, and costs, differ from employer to employer.
In general, there are three types of benefits: standard, voluntary, and lifestyle.
- Standard (mandatory). Some benefits are required for all businesses, no matter the size; those include Social Security, Medicare, workers’ compensation, and unemployment insurance. If your employer has 50 or more employees, it must also provide family and medical leave and health care. In addition, your state of residence may require your employer to provide certain benefits; to find out, search on a browser for “workplace benefits required by [your state].”
- Voluntary benefits. This category includes benefits that your employer chooses to offer. With voluntary benefits, you generally pay most or all of the premium, and you can opt in or out. For some of them, you may be able to choose your coverage level, too. The list of voluntary benefits is long and varied, but the top ones typically include accident, critical illness, dental, hospital indemnity, long-term disability, short-term disability, vision, and voluntary term life.
- Lifestyle benefits. These benefits are what the name implies: support for extras in your life. Typical options are gym memberships, wellness and other perks, time off for volunteering, tuition reimbursement, and hybrid or remote work arrangements.
You may choose to opt in or opt out of benefits based on your life needs, and you may also be able to increase coverage levels. For example, say you have a spouse with an employer-provided healthcare plan. You may enroll in that plan, and then opt out of your employer’s offering. Or, you may opt in to a voluntary benefit like critical illness and choose the coverage level.
Most benefits have a direct cost, generally divided in one of three ways:
- Your employer pays for everything.
- You and your employer share the costs.
- You pay for everything; your employer provides access.
In general, the type of benefit determines who pays for it.
| Type of benefit | Who pays for the benefit |
|---|---|
| Standard | A combination of employer and employee contributions |
| Voluntary | Employee |
| Lifestyle | Mostly employer; some employee contribution may be required |
Let’s look at an example: hospital indemnity. In this example, your employer is providing access for something that may be of value to you. You opt in, and pay for the cost through workplace deductions.
| Benefit | What it is | When you might use it | How it helps you | How the cost is paid for |
|---|---|---|---|---|
| Hospital indemnity | Supplemental insurance to help with out-of-pocket hospital stays | Childbirth (planned) or ER visit (unplanned); when a cost such as a deductible is not covered by health insurance | Offers additional coverage so you don’t have to find funds to help pay for a hospital stay | Typically by you; your employer provides access to the benefit so you don’t have to purchase it on the open marketplace |
For illustrative purposes only.
If you don’t know everything about your benefits, you’re not alone: More than half of employees have questions, are confused, or don’t understand benefits at all. One-third lack enough confidence in benefit selection to feel like they’re doing their best for themselves and their families.
Here are some tips to learn more about your benefits:
- Mark enrollment time on your calendar. You’ll probably receive an email with exact dates; timing is generally in the fall (October or November) at which you can elect coverage levels and opt in for voluntary or lifestyle benefits.
- Get information on your full benefits package from your HR department or benefits provider. There may be benefits that you’re not aware of, such as identity theft or financial planning resources.
- Ask fellow employees what benefits they’ve used. Examples can help you decide what you might want.
Finally, if there’s a benefit you think might add value to your workplace, ask. Employers are constantly monitoring their employees—especially the needs of multiple generations—and adding new benefits such as mental health and financial wellness packages to help keep valuable employees.
Your benefits package is quite likely one of the reasons you chose your position or choose to stay at your job. It’s a complex mix of things you want and need. The whole picture—cost, access, usability, practicality, goal setting—informs the value of a benefits package.
What life needs do you have, and what workplace benefit might be a good match? Get some help sorting through your voluntary benefit options.
