Total compensation: how to compare job offers beyond base salary
Base pay is only part of an offer. Total compensation adds bonuses, equity, retirement contributions, health cover, leave and other benefits, and subtracts costs such as commuting or insurance premiums. Put each offer into the same table with real figures and compare the yearly totals.
At a glance
- Convert every part into a yearly amount.
- Count only what is written in the offer.
- Separate guaranteed pay from variable pay.
- Subtract costs you will bear (premiums, commute).
- Value flexibility and growth, but keep them separate from the money.
What to count
| Component | Ask |
|---|---|
| Base pay | Yearly or hourly? Paid how often? |
| Bonus | Target or guaranteed? Payout dates? Conditions? |
| Signing bonus | Repayment if you leave early? |
| Equity | Type, vesting schedule, cliff, what it is worth if the company is private |
| Retirement | Employer match or contribution |
| Health | Employee cost, deductible, who is covered, start date |
| Leave | Paid vacation, sick leave, holidays |
| Other | Learning budget, remote allowance, relocation |
Worked layout
Create a table with one column for each offer and one row for each item above. Fill in yearly amounts. Total the guaranteed rows first, then add expected variable rows separately.
Example of the method (not a real offer): an employer offers a base amount, a bonus described as "up to" a percentage of base, and a retirement match. Compute each yearly, then ask in writing how often the bonus has been paid.
What official sources say about benefits
The Bureau of Labor Statistics reports employer costs for employee compensation. For private industry in June 2026, it reports that wages and salaries were 70.0 percent of total employer compensation costs and benefits were 30.0 percent. That is a national average, not your offer, but it shows that benefits are a large part of what employers pay.
The Department of Labor says federal law does not require paid vacation, holidays or sick leave. The Fair Labor Standards Act does not require payment for time not worked, so these are set by agreements between employers and employees. That makes written leave terms in your offer important.
For equity, the IRS explains that stock options are taxed differently depending on whether they are statutory or nonstatutory. For most nonstatutory options with no readily determined value, there is generally no taxable event at grant, and at exercise you include the stock's fair market value minus what you paid. Ask a tax adviser how your award is treated.
Step by step: compare two offers
- List every component in the table above for each offer.
- Convert each to a yearly amount.
- Total the guaranteed pay: base, guaranteed bonus and employer retirement contribution.
- Add expected variable pay in a separate line, using the payout history you were given.
- Subtract your yearly costs: insurance premiums, commuting, parking, required equipment.
- Compare the two totals, then compare the non-money factors.
Common mistakes
- Counting a bonus "up to" a figure as if it will be paid in full.
- Counting equity from a private company at face value.
- Ignoring the start date of health cover.
- Forgetting repayment terms on a signing bonus.
- Comparing hourly and salaried offers without converting to the same period. See hourly to annual salary.
Questions to ask
- Is the bonus paid on company, team or personal performance?
- What portion was paid in the last two years?
- When does health cover begin?
- What is the notice or clawback for the signing bonus?
- Is there a pay review date?
Non-money factors
Commute, remote options, schedule, manager, learning, stability. Rate each from 1 to 5 for yourself and compare.
Negotiating the whole package
If base pay is fixed, ask for a signing bonus, extra leave, a review date or a title. See how to negotiate salary and counter offer emails.
Frequently asked questions
Is equity worth counting? Count it cautiously; at a private company it may be worth nothing. Ask for the terms in writing.
Do I include employer taxes? No. Count what you receive and the costs you pay.
Is paid time off required by law? Not by federal law, according to the Department of Labor. Check the rules where you work and get leave terms in writing.
What counts as guaranteed pay? Base pay and any bonus the offer states as guaranteed. Target bonuses are not guaranteed.
What about pay in India? CTC works differently. See CTC versus in-hand.
Next step
Build the table for your offers, then ask the employer for any missing terms in writing.
This page is general career information.