Congratulations on having received a full-time job offer! If you’re wondering if your offer is as good as it sounds, keep reading.
How Do I Evaluate an Offer?
Do your research! Consider the following factors when deciding if your oﬀer is appropriate:
|Your Perceived Value||
These considerations (and more) will give you a base understanding of what makes up a reasonable salary and benefits package for the type of position you are being offered. If it seems that some of these factors are not being considered by your employer, you may choose to negotiate your offer.
These resources will help you uncover current industry trends, negotiating tips, and company-speciﬁc information:
What Starting Salary Can I Expect?
Starting salary depends on your industry, experience, and location of your job search. Cost of living changes drastically depending on geographical location. If you are searching for jobs in multiple states or regions, it’s important to research prices of housing, food, and transportation. You can use this calculator to compare the cost of living in two diﬀerent locations. For example, if you have a job oﬀer in Manhattan for $45,000, a comparable salary in Cincinnati, Ohio is $18,195!
What will my take home pay be?
When considering salary and budgeting, you may wish to estimate your net income. A very rough rule of thumb to calculate how much your take home pay will be is to assume that about ⅓ of your gross salary from each paycheck will be withheld to pay for taxes, healthcare or other optional deductions for retirement, etc.
|Federal Income Tax (varies by income level)||FSA (Flexible Savings Account)|
|State Income Tax (varies by state and income level)||HSA (Healthcare Savings Account)|
|Social Security & Medicare are taxed at a set rate||Dental|
If you are self-employed you will also have pay self-employment tax.
|Other withholding (life insurance, transit, etc.)|
When you ﬁll out paperwork to start your job you may choose how many allowances to claim. Depending on your income level you may owe money or receive a tax refund after ﬁling income taxes with the IRS in April. Use an online calculator to determine how much to expect in your paycheck based on your state and withhholding choices.
Do the math. How much do you need?
Consider a few examples:
- If you work 40 hours/week at a salary of $8,000 for 8 weeks, you are making $25 hour for a total of 320 hours.
- You may work 9am-5pm with evenings and weekends free for socializing, a side hustle, project, or down time.
- If you work 90 hours/week at a salary of $20,000, over 8 weeks for total of 720 hours, your hourly salary works out to $27.77 an hour.
- You will make more money and the rate per hour is slightly better, but consider work/life/social balance.
- You may work 7am – 11pm, plus 10 hours on the weekend and never see your friends (unless they work with you).
- If you work 40 hours/week for a stipend of $1000 for 8 weeks the hourly rate is about $3.12. In this case, you’re probably not doing it for the salary.
- Consider whether you will gain valuable connections, skills, and experience or contribute to a cause important to you.
Why is it important to pay oﬀ debt?
As you consider your budget, remember that school loan payments are not deducted from your paycheck. Use the Student Loan repayment estimator to ﬁgure out your monthly loan payments. Getting a head start on paying oﬀ your student loans will decrease the amount of money you pay in interest. Even a few dollars extra a month can add up to paying oﬀ your loans one month faster in the long run. Check out this calculator to see the diﬀerence between paying the minimum each month and paying a little more.
Do retirement packages really matter?
When considering a job oﬀer, ask for speciﬁc information on retirement packages. Some employers may oﬀer a 401(k) or 403(b). These allow you to opt in to contributing money directly from your paycheck. Beyond that, some employers may oﬀer a company match of your contributions to those accounts. The company match is essentially “free money” that you can tap into when you retire. Because of the compound interest gained on these accounts it is important to save for retirement as early as possible.
What’s the deal with health beneﬁts?
Companies vary widely in terms of health insurance coverage and payments. At many large companies, beneﬁts (health insurance, retirement contributions, vacation, sick leave) cost about 33% of your salary. Some start-ups or small businesses will oﬀer limited beneﬁts. Many non-proﬁts oﬀer better beneﬁts as an incentive because base salaries may be less competitive than at for-proﬁt corporations.
It will serve you well to seriously analyze what you are getting in addition to your base salary. For example, you may pay $20/month or $400/month for health insurance, depending on company size and employer contributions. With no retirement plan, minimal insurance coverage, and long hours, that great job oﬀer may turn out to be just average.
Also look at the costs and coverage insurance provides. What are co-pays for oﬃce visits, prescriptions, and specialists, in network and out of network? Is there a large deductible (the amount you have to pay before insurance starts to cover healthcare costs)?
Office Perks and other benefits
The possibility of stock options, commuting cost reimbursement, or in-office meals and snacks varies by employer and industry. Still, don’t forget to consider them when evaluating or negotiating your offer. Be careful not to weigh perks that you may not use too heavily. Even the best office environment cannot make up for a base salary that is not competitive in the long run.
Decision Matrix: Comparing Your Options
Still trying to decide whether to take an offer? Comparing multiple oﬀers? The following tool may help. Use the table below or create your own list of factors to consider. You can set up your own ranking system using Excel with this pre-loaded ranking formula.
- List the oﬀers of potential internships/jobs across the top.
- Contemplate what would happen if you let go of the oﬀer and do not receive another.
- Include your backup plan as its own column. For example, keeping your current day job, taking summer classes, volunteering, or working for a family friend.
- Down the side, list the factors important to you in making this decision.
- You can use those listed below or choose your own.
- Complete a values assessment to help you think through what matters to you. Identify the three values most important to you.
- Rank each factor to assign weight from 1-10 in order of importance to where 10 has the most value to you. The higher the number the more weight it has.
- Evaluate how well each position or opportunity satisﬁes each work factor. Use a scale of 1-10 to quantify your response.
- Check that each cell has a number; do not leave any cells empty. Hit Ctrl+R (in Excel) to Total the columns and get your results.
|Choose Criteria (Factors)||Rank to Assign Weight||Evaluate Each Option|
|Factor||Factor Weight||Job 1 Oﬀer||Possible Job 2||Backup Plan|
|Advance Toward Long Term Goal|
|Job 1 Oﬀer|
|Possible Job 2|
|Factor||Factor Weight||Job Oﬀer 1||Possible Job 2||Backup Plan|
|Company Culture Fit||3||9||5||7|
|Contribution to Society||1||8||7||8|
|Advance Toward Long Term Goal||6||7||8||5|
|Job 1 Oﬀer||348|
|Possible Job 2||346|
When you compare positions you may ﬁnd there is not a huge diﬀerence in the ﬁnal score. For instance, Job 1 and Job 2 are almost equal, but the backup plan lags behind. The exact numbers are not important. Rather, the idea is for the decision matrix to allow you to compare apples and oranges.
Consider how well each job addresses your top values. These might include stability, challenging work, impact, money, prestige, work-life balance, making a contribution, bragging rights, and ﬂexibility. Also consider how the culture of each company ﬁts with your values. Culture ﬁt is an important part of the whole picture.
It is often clear which job is best for you. It may be a matter of accepting the risk and potential consequences of your decision to let go of an oﬀer.
- How well can you tolerate the uncertainty of not having an oﬀer?
- What resources do you have to fall back on?
- Financial: Do you have savings? Are you able to pay rent and other necessities?
- Personal: How resilient are you? How tolerant of risk are you?
- Professional: What’s your network? Do you have past employers or old jobs you can return to?
Sometimes you will have a sense of which job feels right, but it can be difficult to explain why. This may especially be the case if your reasons are rooted in your personal values rather than logic. You may also be dealing with external inﬂuences questioning your decision and the value or prestige of the work. Work with a career counselor to talk through your decision and how you might share it with those people.
I Have an Offer, but I Have Another Interview Next Week. How Can I Handle This?
Honesty and transparency with potential employers is key. You want to make sure you are being professional while assessing your oﬀers and other interviews.
The ﬁrst step to take is to determine whether your current oﬀer has a deadline. If it does, and that deadline comes before your other interview, then you can call or e-mail the ﬁrst employer and ask for an extension on the deadline. It is possible that you will not have a phone number for your recruiting contact, but if you do, we recommend following up by phone. It allows you to express your interest in the position more clearly through words and tone of voice.
Some examples of what you might say are
- You appreciate their time.
- You are interested in the work/company.
- You would like to clearly understand all of your options before committing because you take this decision seriously.
Reneging, or reversing your decision after you’ve already accepted, is not professional or recommended. If an extension is not granted, then you have a diﬃcult choice. We recommend coming to Quick Questions or scheduling an appointment to discuss this before deciding to accept a position.
These are just some of the questions that will help you think about the true value of your oﬀer. It is also important to consider if a job is right for you personally. Be cautious about evaluating an oﬀer solely on its salary or the prestige of the organization. Ask yourself how this position ﬁts into your long-term goals.