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Started By
Message
Need help breaking down a job offer....
Posted on 12/21/15 at 8:54 pm
Posted on 12/21/15 at 8:54 pm
I've been unemployed since graduating in May (Bachelors in EE), so I accepted a job that I really couldn't negotiate for. The pay is only 20% more than what I was making 4 years ago, pre-degree. I'm making 20% LESS than my fellow graduates that were hired by Entergy/Shell. I'm really hoping that the benefits are better than average, but I have no idea:
The thing that stood out was "Simplified Employee Pension" plan. There is no 401k situation where you have to invest to get money. After 3 years, the company simply invests 20% of what you're making at the time into an IRA or something that I don't even know about. He also said that there are no penalties for taking money out. This seems like a pretty good deal, but I'm also kind of retarded. Would a typical 401k have been better?
The other big thing is health insurance. I have no idea what is the norm. Before costs started exploding, I was getting it all paid for by the employer. The company is paying 90% of a "Section 125 (Cafeteria) plan." Is that any good? Cafeteria sounds pretty shitty.
Thanks.
The thing that stood out was "Simplified Employee Pension" plan. There is no 401k situation where you have to invest to get money. After 3 years, the company simply invests 20% of what you're making at the time into an IRA or something that I don't even know about. He also said that there are no penalties for taking money out. This seems like a pretty good deal, but I'm also kind of retarded. Would a typical 401k have been better?
The other big thing is health insurance. I have no idea what is the norm. Before costs started exploding, I was getting it all paid for by the employer. The company is paying 90% of a "Section 125 (Cafeteria) plan." Is that any good? Cafeteria sounds pretty shitty.
Thanks.
6
Posted on 12/21/15 at 9:07 pm to THRILLHO
quote:
Simplified Employee Pension
This is something a very small company would offer IMO. They will likely change the plan by the time you are eligible FWIW. So, that's my cynical view as a small business owner. It's a way for the owners to sock away tax free money without maintaining a 401k and the rules that go along with it.
So, is this a small company, and are there any employees that have been there for three years and are eligible? If so, that's a good sign. Still, you are at a disadvantage as it doesn't sound like you have any method besides an IRA to save for retirement.
Posted on 12/21/15 at 9:07 pm to THRILLHO
What is the company's turnover rate? Why is your position that you are applying for vacant? What is the turnover rate for the position you are seeking?
Posted on 12/21/15 at 9:34 pm to THRILLHO
SEPs are wonderful retirement plans for smaller employers.
They are actually IRAs funded by the employer. As such, withdrawals before 59 1/2 years of age and not rolled over are subject to the 10% penalty tax in addition to regular income taxes. There is no vesting schedule and employees cannot borrow from their balance in the plan.
I had a SEP for my business and it was a terrific method to accumulte tax deferred savings.
They are actually IRAs funded by the employer. As such, withdrawals before 59 1/2 years of age and not rolled over are subject to the 10% penalty tax in addition to regular income taxes. There is no vesting schedule and employees cannot borrow from their balance in the plan.
I had a SEP for my business and it was a terrific method to accumulte tax deferred savings.
This post was edited on 12/21/15 at 9:35 pm
Posted on 12/21/15 at 10:03 pm to THRILLHO
quote:
I've been unemployed since graduating in May (Bachelors in EE),
Oh God... Are you a millenial
Posted on 12/22/15 at 7:45 am to THRILLHO
I find that hard to believe an employer with ~20 employees is running a SEP. these are typically used for small business with 0-1 employees. You sure it's not a Simple IRA? That would be more plausible with the size of this company.
Posted on 12/22/15 at 6:48 pm to THRILLHO
quote:
Entergy/Shell
I just want to put your salary into perspective. I'm an EE with about 17 years experience and worked for Entergy and currently work for Shell.
You do realize that the 20% higher salary you are complaining about isn't the norm?
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