Benefits Or High Wages, Which Is Best?

In a perfect world, a job would provide you with both a high wage and good benefits. However, sometimes circumstances are less than ideal. So if an individual must choose between a high wage or great benefits, which should they choose?

OPINION | A tremendous bonus to any job is its additional benefits. From health insurance to retirement plans, benefits can cover a vast area of categories and can be a deciding factor for potential employees. However, can good benefits alone justify a low wage or would it be better to take a higher wage with lesser benefits? If given a choice, choosing a job with better benefits is the correct option.

While a high wage is sought after, taking a lower wage for good benefits could be a better move in the long run, especially regarding retirement plans and medical coverage. Those who have spent time in a doctor’s office or hospital know that medical care can be painfully expensive when you pay out of pocket. In fact, according to, the average 3-day hospital stay costs $30,000 – or $10,000 a day. This hospital trip could destroy an uncovered individual’s finances without proper medical coverage. While it is true that an individual can pay for their own coverage instead of getting it through an employer, the cost of good healthcare could be upwards of $500 a month, possibly even reaching $1000. Having an employer that covers these fees makes life exceptionally easier. A good benefits package will likely include vision and dental plans, ensuring you are covered all around regarding your health.

A good retirement plan can outpace a higher wage in the long run. Employers who offer pensions, annuities, or 401K matching are setting individuals up for their financial future. The interest gained in these accounts only compounds over time, possibly reaching hundreds of thousands or even millions by retirement age. While individuals can contribute to a retirement plan themselves, they must then take from their own wages, possibly bringing their take-home wages down to the same level as their colleagues who chose to have better benefits. These colleagues who choose benefits over wages can also open up another retirement plan if they so choose and have many revenue streams feeding their financial future.

It is important to note that while benefits may be the main focus of any job, seekers should still consider wages. Choosing a job that pays $20 an hour with full benefits over a job that pays $40 an hour with partial benefits may not be the savviest option. When job hunting, it is best to search the list of employer-provided benefits and decide what is best for you and make an informed decision based on what you have found.