Knowing your employee benefits can either earn you a lot of money or save you a lot of money.
If you don’t take advantage of all your employee benefits you might be losing out on free money so be sure you take a detailed look at what your employer offers and what you can claim.
Too often I hear my co-workers say they didn’t bother making a claim because it’s only a few dollars. That’s a ridiculous way to think, you could be giving up hundreds of dollars every year. Your benefits are taxable so they’re not completely free.
Here’s a look at some common employee benefits and how they may affect you.
Pension / RRSP Plan
Pensions are becoming increasingly rare so if you have access to a defined benefit or even a defined contribution pension you need to sign up now. Instead of a pension some companies offer a straight up RRSP match which is still free money so sign up for the maximum amount if you can.
Stock plans are great if you have access to one since its more free money. If your payouts increase with time then you should sign up as soon as you can. Personally I maximize my stock plan and then sell some of it every year to fund my TFSA, so think about using your stock plan to fund your other financial goals.
At businesses where employees are part of a union it’s common to get a pay increase when working certain shifts or performing certain tasks. What you get paid extra for really depends on what your union has negotiated so check out your union handbook to find out everything that you can charge for. It doesn’t matter if it’s only an extra dollar an hour, charge for it.
This benefit is pretty straight forward and tends to be the one employees care most about. If by chance you or your spouse gets a 100% drug plan benefit then the other partner may want to consider opting out of their employee benefits. Dropping your benefits will allow you to pocket a little extra each month, but remember opting out cancels all your health benefits so you need to figure out the overall value first.
Oddly enough this is one benefit employers seem to have been making changes with. Traditionally we’re covered for a visit to the dentist every 6 months, but now it’s not uncommon to see benefits cover trips made every 9 or 12 months.
Although there are guidelines for how much procedures should cost, dentists can actually charge whatever they want for their services. If their rates exceed what your benefits cover, you’ll obviously need to pay the difference. If that’s the case I would consider switching dentists.
Rarely have I seen a benefits plan that will cover the full cost of getting braces so if you ever need this procedure be prepared to pay out of pocket. Since this is a straight payout the benefits provider is usually pretty strict about who qualifies for coverage. They usually require that the person getting the work done must have been listed as a benefits member for at least 6-12 months.
This time limit can be waived if there is a life event e.g. getting married / common law but is up to you to inform your benefits provider of this event.
Another benefit where the cost is almost never covered in full; vision benefits are pretty straight forward but one thing that is often misunderstood is how often you qualify. Most of the time we’re covered for a certain amount every 2 years, well this often means every 2 calendar years, not 2 years to the date of the last claim.
If you used this benefit in December of 2012, you would qualify for your next benefit in January of 2014. However if you waited until January of 2013 to make a claim you would then need to wait until January of 2015 for your next benefit.
Again you want to check your personal benefits to see how vision is paid out.
Registered massage therapists are always covered here but sometimes your benefits may also cover you for chiropractors or acupuncturists. Also note that there’s a good chance you’ll need a doctor’s note saying you need massages before your insurer will make any payouts.
Every insurance package is different but generally speaking most of the time employers offer group insurance for their employees which may not be enough to cover your individual situation. Even if your employer offers you a good plan keep in mind that it only covers you as long as you’re an employee. It might be worth it to purchase additional insurance from an outside company.
I’ve covered just some common employee benefits here but you still need to check out what your individual plans cover you for. You might be surprised at what your benefits covers.