Accepting Offers, Benefits & Salary

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You nailed your interview and are flying high with a shiny new job offer.  Congrats!  Now what?

When you receive a job offer, do not accept or decline right away.  It is standard and expected for you to take some time to consider an offer, even if it’s your dream job.  Take some time to consider the whole package.  This means doing your research on your salary, building a budget, considering retirement plans, looking at healthcare plans, professional development opportunities, understanding your vacation and sick time, understanding health and disability leave, and bonuses.  

Also, you must keep in mind that a verbal acceptance is as valid as a written acceptance.  Going back on a verbal acceptance is still considered reneging on an offer of employment.  Reneging is a severe violation of our policy, and will have serious ramifications on your job-searching while on campus.  

Students often run into problems with reneging when juggling multiple offers.  If you are considering multiple offers, take your time to do thorough research and pick the best option for you.  If you have an offer but are waiting for a decision from an organization that you would prefer, you should request an extension on the original offer so that you can evaluate them both side-by-side.  

Employers will usually allow for a few weeks, and sometimes longer, for you to make a decision on an entry-level position.  If the decision date approaches and you have yet to complete the process, you should email them two weeks in advance of the deadline to request an extension for two weeks beyond the deadline:

Dear [Mr./Ms./Mrs. Recruiter Name]:

Thank you for the opportunity to work with Morgan Stanley as an Investment Banking Analyst.  I am most appreciative of your offer, and am very interested in the position.  However, I have committed to several organizations for second-round interviews and would like to see these through to completion.  I am writing to request a delay in my response date until [two weeks beyond deadline] to collect all of the information I need to reach this important decision.  Thank you for your consideration of this request.

Sincerely,

Your Name

When considering your offers, do your research on salaries.  Please note that you should not bring up salary on your own, the employer should make the first offer.  You can research what salaries to aim for and industry standards using tools like Salary.com, Glassdoor, Payscale, and Job Search Intelligence.  Job Search Intelligence allows you to enter your degree level and school so that you can get information that is more specialized.

While you research salaries, you should create a budget.  Common costs to include on your budget are: rent, groceries, commuting expenses, auto or home insurance, health insurance estimates, utilities, student loan repayments, cell phone bills, and cable/internet.  There are some services out there to help you create a budget!  You Need a Budget provides free trials to students, and Mint is an app that you can download for free for real-time budget management.  

Once you have your baseline budget created and understand the possible salaries you could receive, do some personal evaluation and prep for a negotiation.  You should go into salary negotiations with a range rather than a number.  To create your range, use the median salary you’ve researched as your low-point, and provide a reasonable cap as your high point.  

If an employer says that salary is not negotiable, consider negotiating other parts of your benefits package, such as vacation time and bonuses.  Sometimes a company will offer you a bonus for accepting an offer.  Companies do this for different reasons, and often to incentivize a hire.  The timing for receiving this offer also depends on the job –it can be awarded to you at signing, or after a year of service, or on a variety of other timelines.  If you accept a signing bonus and then decide to leave the job, the employer will often ask to be repaid this bonus.  Be mindful of this when you accept this offer or make plans to leave your job.  Other bonuses include: retention bonuses, holiday bonuses, referral bonuses, commissions, and performance bonuses.  

Take a close look at the sick time, vacation, and holidays.  Project out how many you receive of each in a year so that you can plan your baseline needs and see from there.  Your salary is not the most important number – be mindful of these figures. Also take a look into disability and medical leave – accidents and sickness can happen to anyone.

Even if you’re accepting your first job, be sure to look into retirement plans offered at the organization.  Do not get caught up in thinking that you are too young for a retirement plan!  You should start saving as early as possible.  Often, companies will match your investment on a scale, or according to a certain percentage over a certain period of time.  Sometimes a company will require that you work for a certain period of time before they begin to match.  Other times, an employer will match right away but only allow you to keep the money that they invest if you work for a set period of time (usually 1-3 years).  This is called a vesting period.  Be sure to familiarize yourself with these details, especially if you plan on transitioning into a new industry or organization, or if you’re thinking about returning to graduate school.Also check to see if your company provides a 401k or a 403b – these are separate options that impact where your money is invested.  

Healthcare plans are a famously difficult to navigate.  We recommend that you go through this glossary to understand many related terms and aspects of health benefits.  Students frequently ask about:

  • Copay – The amount that you pay at the office after receiving health services.

  • Deductible – The amount that you pay for covered health care services before your insurance plan begins to pay for you.  

  • FSA, or Flexible Spending Account/Arrangement – Money that is set aside into a separate account through an arrangement between you and your employer to cover out-of-pocket medical expenses with tax-free dollars.  This money is not taxed, and you get to decide how much to set aside from each paycheck.  

As you familiarize yourself with health plans, be sure to calculate the cost per paycheck, and include this in your budget estimates.  Also be sure to understand your dental and eye insurance!  These are sometimes offered as a package deal.  

Sometimes employer benefits go beyond the numbers.  Does the company offer opportunities for tuition reimbursement, or supporting you as you pursue another degree?  Money for conferences, seminars, or professional association memberships?  Do they provide maternity leave, child care, wellness programs, or mental health counseling?  Other benefits that folks on our staff have utilized at previous employers include incentives for homeownership locally to the company, free food and access to kitchens at work, and more.  These perks impact your life and wellbeing!

Finally, there are some forms that you need to be familiar with for your first day on the job if your employment is in the United States:  

First, the W4: the W4 determines your take-home pay.  It is where you list withholding allowances.  A withholding allowance is a number used by your employer to determine how much federal and state income tax to withhold from your paycheck.  The more allowances you claim, the less income tax will be withheld from your paycheck.  However, you might owe money around tax time.  The lower number of allowances you claim, more taxes are taken out of your paycheck through the year.  However, claiming fewer allowances will usually lead to a higher tax return.

Next is the I9, which is used to verify the identity and employment authorization of individuals hired for employment in the United States.  You will need to bring documentation to verify that you are eligible tin the United States.  You can browse through this list of acceptable documentation; common forms of ID that are acceptable include your passport, permanent resident card (with signature or with notation, “signature waived”), your driver’s license or state ID with your social security card, and so on.  

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