You’ve just been hired, and you’ve received a benefits package. However, you may not fully understand all of your employee benefits, and you’re trying to figure it all out. It’s a key part of your total compensation, offering valuable support beyond your salary. Getting familiar with these benefits now helps you make smart choices for your health, finances, and future. Let’s take a look at what’s available.
Retirement Plans
Most employers offer retirement plans to their employees. You would contribute money to this plan, and you’ll use these funds after retirement. 401k plans are popular retirement plans found in a benefits package. A 401k plan is a retirement account where a portion of your check is placed, and your employer may also match your contributions.
A 403b retirement plan is designed for public school employees and certain nonprofit workers. Employees can contribute part of their checks to this account, and like the 401k plan, some employers match your contributions.
457 plans are for local and state government workers, and this account operates similarly to 401k plans and 403b plans.
Healthcare Benefits
According to the Affordable Care Act, employers with more than 50 employees must offer health insurance. One type of employer health insurance is group insurance. This type of insurance places all employees under one policy. Here are more types of employer health insurance.
Preferred provider organizations make up 48% of employer-covered health insurance plans. PPOs allow you to have a preferred group of providers, and you have access to out-of-network providers, although you could pay higher premiums to use this option. You also don’t need a referral to see a specialist. You’ll also pay deductibles, which are what you must pay before the insurance provider pays for services you receive.
A health maintenance organization requires you to have a primary care physician, and you’ll need a referral from this physician to visit a specialist. HMOs have lower out-of-pocket costs, but you’ll experience more restrictions on choosing out-of-network providers. This is because your HMO doesn’t cover services from out-of-network providers except in emergencies.
Other employers offer high-deductible health plans. One benefit of these plans is your ability to open a health savings account. This is a savings account where you contribute and invest funds to use for qualified medical expenses. All funds in your health savings account are tax-free as long as you use the funds for qualified medical expenses.
If you’re a new employee, there is usually a waiting period before you can get the health insurance. The waiting period is between 30 and 60 days. Once you sign up for the insurance, add your children and other dependents to the plan. Ask if your employer offers separate dental and vision plans.
Some employers offer healthcare benefits beyond health insurance plans. These include blood pressure and diabetes testing, wellness seminars, and fitness challenges. There are also employee assistance plans, which often include access to mental health resources such as stress management programs and therapy.
Paid Time Off
Paid time off is another neat perk that comes with some benefit packages. You can use paid time off for vacations, sick days, or personal days. One type of PTO is consolidated paid time off. This type of PTO happens when you’re given a certain number of days each year to use as you wish. Other employers categorize their PTO days. The categories may include:
- Vacation time
- Holidays
- Sick leave
- Parental leave
- Bereavement
New employees have a 30 to 60-day waiting period before they can accumulate paid time off. Once you accumulate paid days off, you can use your employer’s online portal to keep track of how much PTO you have during the year.
Flexible Spending Accounts
These are employer-sponsored accounts that you contribute to for your and your child’s medical and childcare expenses. Withdrawals from your FSA are tax-free, and this account is especially helpful in paying for services that your health insurance provider doesn’t cover. You may receive an FSA debit card to purchase eligible items. For 2025, you can contribute $3,300 to the FSA. You pay for eligible items out-of-pocket, and then you submit a claim for reimbursement from your FSA.
Two types of FSAs exist: the Health FSA and the Dependent Care FSA. Eligible items you can buy with the health FSA include health insurance deductibles and copayments, medications, dental and eye exams, X-rays, dentures, contact lenses, and eyeglasses. The Dependent Care FSA covers a few childcare expenses. They include day care centers, nurseries, before and after-school programs, and summer camps.
Tuition Reimbursement
If you plan to attend college while working, inquire about tuition reimbursement. This is a program where your employer assists with your tuition costs. You pay for the tuition and other expenses yourself, and after you receive your degree, you fill out a form for reimbursement from your employer. Every company has its own tuition reimbursement requirements. Some companies require you to work full-time and for a certain number of years before reimbursement kicks in. Other companies may want you to complete coursework in a certain degree program to qualify for the reimbursement.
Flexible Working Arrangements
You’re lucky if your company offers this as part of your benefits package. There are different types of flexible work arrangements to choose from. Maybe you can work remotely on certain days out of the week, or you may be able to do a shorter work week since you’re caring for your aging parents.
Understanding your employee benefits is crucial for maximizing your overall compensation and well-being as a new hire. Don’t feel overwhelmed; simply make it a priority to thoroughly review the provided benefits guide, attend any orientation sessions or workshops offered by HR, and utilize online portals or apps for easy access to information and your balances.