Employee benefits have been big news lately, and not just because of Obamacare.
Whether it’s The Wall Street Journal discussing government obligations (The Other Debt Bomb in Public-Employee Benefits) or a Catholic news service discussing religious objections (Missouri bishop objects to Catholic hospitals’ choice to extend employee benefits to same-sex partners), these benefits have become a source of great controversy.
Sadly, that’s overshadowed how they’re also a source of great savings.
Here’s to you health — and more
When most folks hear the term employee benefits, they think health insurance and retirement accounts — and that’s it. Depending on where you work, however, they can be so much more.
The problem is, you get hit with your “benefits package” right when you get hired. You’re often handed a stack of booklets and papers at the same time you’re trying to master a new job. Also, let’s be honest: Benefits are not an exciting topic. Yet they can be a lucrative one.
Let’s look at some benefits that have nothing to do with health and retirement. Simply by contacting your Human Resources department, you can find out if your company offers them…
1. Employee stock option plan
If you have debt you’re still paying off, this isn’t the best option for you. However, if you work for a publicly traded company and want to start investing, this is often a reasonable method — because you often get a discounted price.
For example, Debt.com’s editor Michael Koretzky once worked for a newspaper owned by a large chain. When he got a raise, he decided to use a chunk of it to buy some company stock. He received a 15 percent employee discount and had a few dollars automatically deducted from each paycheck, so he never missed the money.
Stocks are a riskier proposition than, say, CDs, so Michael wisely didn’t invest all his money in his company’s stock. However, what stocks he did buy paid off when the company was later sold.
2. Tuition reimbursement
Michael’s wife works for the local state attorney’s office, and the state offers to pay full tuition for college courses its employees take — as long as those classes are relevant to their jobs, and it doesn’t affect their work schedule.
According to the Society of Human Resource Management, or SHRM, 61 percent of employers offer some sort of “undergraduate educational assistance.” The rules vary wildly, with some employers paying all, some half, and others a lesser percentage of tuition. Some pay up front, some reimburse after the fact. You won’t know until you ask your HR department.
3. Qualified transportation plans
Yes, it has the acronym QTP, which sounds like a cotton swab. It’s also known as a qualified transportation spending account. Whatever you call it, the concept is simple:
You set aside money to pay for your work commute and parking. The money you set aside is pre-tax, meaning the IRS can’t take a cut of it. That amount is automatically deducted from your paycheck, so you don’t miss it. You then submit a form for getting reimbursed for those expenses.
The IRS says the most you can claim is a maximum of $490 a month, but even at a lower rate, that’s a nice chunk of money to keep from getting taxed. Of course, this benefit will be most lucrative for employees in big cities that charge a lot for parking, but it’s also a big benefit for those who can’t afford a car and need to take public transportation.
SHRM says only 13 percent of employers offer QTPs, but it’s still worth asking about.
4. Health savings accounts
I know I said I wouldn’t talk about health insurance, but HSAs are too good not to mention.They’re not exactly health insurance, but they can be used to pay for health care costs. They work just like the QTPs I mentioned above: You set aside money pretax, and you dip into it for authorized expenses you need to buy anyway.
Even though HSAs have been around since 2003, I’m always surprised at how many employees don’t realize they exist. That’s why Debt.com compiled this easy-to-read HSA guide to setting one up and benefiting the most from it. I urge you to check it out.
Best of all, while many employers offer HSAs, you can get one from other places — and they’re FDIC-insured.
5. Misc. etc.
These are more long shots, since SHRM says less than 10 percent of employers offer these benefits. But I’ll say it one last time: You won’t know until you ask…
- Personal tax services: Get your taxes done for free or cheap.
- Personal loans: These are low-interest, although SHRM says some offer no-interest loans.
- Carpooling subsidies: Get reimbursed for fuel if you prove you carpool to work.
- Educational loans: Get discounts on a student loan for college.
Does your employer offer unique benefits? Email me at email@example.com. I’d love to write about that.
Howard Dvorkin is a CPA and chairman of Debt.com, an educational resource for those who want to conquer all forms of debt in their lives.