Fundamental Finance

How to Get Free Money From Your Job

There’s more to employer benefits than health insurance.

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When thinking of benefits, you probably think of the two most popular: health insurance and retirement.

Those are huge, and there are myriad ways to optimize them.

But if those are the only two you use, then you are missing out on a boatload of cash. Employers vary, of course, but many of the lesser-known benefits may include:

Continuing education funds
Cell phone reimbursement
Child care assistance
Tuition for your kids
Retailer discounts
Student loan payoffs

This list goes on.

This article will cover the basics of many of these benefits, then I’m going to delve into examples using my and Amelia’s current employers.

Medical

Health insurance is the 800 pound gorilla when it comes to employer benefits. Some might argue that retirement is first, but contributions to 401(k) and other plans are abysmal at best for lower earning households. Health insurance is the benefit that most everyone elects, regardless of income.

One of the main problems with medical insurance is that you have to choose among a wide variety of plans, with most of them costing about the same in the end.

Add on the legal terminology, confusing language, and lag in processing time and you have a financial quagmire that leads to medical expenses being a leading cause of bankruptcy.

So let’s try to avoid this mess and choose the best one.

Tax-Advantaged Health Expense Accounts

With medical expenses being omnipresent in American household, the federal government has allowed a few ways to make those expenses tax deductible, the most popular of which are the Flexible Spending Account (FSA) and the Health Savings Account (HSA).

The biggest difference between the two is that the FSA is a use-it-or-lose-it deal, while the HSA stays with you year after year.

Regardless of which option you go with, they both save you money.

These accounts work by being funded with pre-tax dollars. Then, when medical expenses occur, you can pay with pre-tax dollars. This reduces the tax burden on your paycheck, increasing your total take-home pay.

For instance, say you go to the ER, with everything covered except your $100 copay. If you pay with pre-tax money, you only need to earn $100 to pay that bill. However, if you use post-tax money, assuming a 20% tax rate, that same $100 bill means you will need to earn $120.

An extra $20 doesn’t seem like much, but let’s use a bigger example.

My deductible for 2021 is $3,750. Paid with pre-tax money, I only need to earn $3,750. If I were to use post-tax money, I would need to earn $4,688.

Covering just my deductible, and not my much larger $6,200 out-of-pocket maximum, saves me $938 in annual taxes.

Other Health Insurance Benefits

Many companies have been offering a “wellness” option with your health insurance plans that give a discount to your premiums. Wellness programs usually include a mandatory physical and wellness consultation. Some may include participation in health-related activities (e.g. going to the gym, tracking your steps, attending nutrition classes).

My last job offered a $35/month discount, which is $420/year. Not too shabby in trying to be healthy.

The opposite side of reducing costs for insurance is paying employees NOT to take insurance. This is what happened just this past year.

My wife moved to a job that has a better set of health plans, so we went with one of those and ended up with a double bonus.

In late 2018, my wife found a job with excellent insurance, but we stuck with mine through the end of the year so that we wouldn’t be exposed to a brand-new deductible. Because of that, I had a $35 bi-monthly penalty added to my insurance premiums.

In 2019, we switched to my wife’s insurance. Not only did the $35 penalty go away, but I was then rewarded with a $65 bi-monthly incentive for not taking my company’s insurance. This one switch lowered our healthcare costs by $200 every month, or $2,400/year.

Retirement

Once you have your health insurance squared away, it’s time to plan for the future.

Retirement plans can be confusing, especially with the move away from traditional pensions and toward defined contribution plans, but it’s necessary to understand the ins and outs of your options.

Pensions

I work for a municipal government, and they have combined their legacy pension plan with their other retirement accounts.

The math can be found in a previous article on pension plans, but the long and the short of it is that if I stick with my current job, I can retire at 59 with a pension of $3,000/month for the rest of my life.

It’s not a ton of money, but it’s guaranteed, lasts my whole life, and serves as one part of the retirement stool.

Defined Contribution

These are the plans where you (not the company) fund your retirement by investing in assets (normally the stock market) with your own money.

The most popular is the 401k. It was never supposed to replace pensions/Social Security, but it did, so we can’t ignore it.

The biggest source of free money is the 401k match, where your company will put money into your account equal to your contribution, up to a certain percent.

If you haven’t checked to see if your company offers a matching contribution towards your retirement account, you need to do that ASAP. It’s one of the most common but also most overlooked source of cash for many people.

The fun part about all of this? If you have a 401k match but “couldn’t afford” to contribute, you can use your newly freed up funds from the strategies in this article to start. Then you can have your company match those contributions, which were sourced with their money, with more of their money!

Truly the definition of win-win.

Other Retirement Benefits

If your company offers a retirement plan, you can usually fund it using pre-tax income. This savings is similar to the tax savings from the medical expense accounts discussed earlier.

Also, if you work for a government or non-profit, check to see if they also offer a 403b plan. If so, you can fund that as well from pre-tax dollars.

For example, my standard retirement plan uses the State of Indiana’s hybrid plan, which has a pension half and a defined contribution half. I also have access to a 403b if I max out the first plan.

Childcare

Paying for daycare, before/after school care, summer camps, etc. is a burden on parents that just keeps getting bigger.

Fortunately, childcare expenses are eligible for their own, separate FSA. This is huge, as childcare expenses can cost as much as college tuition.

Now, this FSA benefit is not just for someone to watch little Tommy when he is a baby. On the contrary, I’ve used this sucker for 8 years now, from birth through 3rd grade.

It can also be used for summer camps, before/after school daycare, and several other categories of “childcare” for your kids. One thing to remember is that it cannot be used for tuition at a private or charter school.

Also, the technical term for this FSA is “dependent care”. IRS Publication 503 spells out what a qualifying dependent is, but the long and short of it is that pretty much anyone who depends on your for at least 50% of their care qualifies.

So if you are shelling out $10,000/year for a part-time nurse to help with your live-in, house-bound grandmother, you can use the dependent care FSA to help offset the tax burden of those costs.

Tuition/Education

Let’s face it, the days of a company paying for your MBA as part of their management track program are over, aside from a few billion-dollar, multi-national corporations. However, that does not mean that there aren’t any educational benefits at all.

Take a deep dive into your HR manual, and I’m sure you will find all sorts of goodies.

Get Schooled

For example, most universities allow their employees and spouses one free class per semester. You won’t get your Ph.D. in under 20 years, but you can take an appropriate class to expand your technical skills. Bosses LOVE to see after-hours education.

If formal higher education tuition is not an option, check for any technical training reimbursements. If you work in a formal trade, your company may pay for one or more classes that could lead to additional certification.

At Amelia’s university, they allow for $1,000 in job-related continuing education, on top of the one class per semester, for both employee and spouse.

If that fails, see if there are any general education (i.e. books) reimbursements that are available. Ask HR what you need to provide to either get it paid for in advance or get the costs reimbursed.

Pay Off Your Loans

I have written about paying off your student loans in several articles (here, here, here, here, and here), so this section will be brief.

If you have student loans, many companies have started offering to help pay them off as part of their overall benefits package. Even the military has the College Loan Repayment Plan, which pays up to $15,000/year for 6 years.

Also, regardless of the wailing and rending of cloth, PSLF is not the mega-problem the media is making it out to be. Yes, there are problems, but it’s a really good program. If you work at a government or non-profit, take a look to see if this is the right option for you.

If you would like more information on the PSLF program, please read my past articles (here, here, here, here, here, here, and here).

If you want more personal takes on PSLF, visit the subreddit r/PSLF. It’s a gold mine of insider tips, success stories, and deep insight into how to successfully navigate the program. I’m on track for forgiveness in December 2025.

Other Discounts

While we’ve discussed some of the major benefits, there are others that may not save as much money, but are nice to have.

Life Insurance

No one likes to think about dying, but people do it every day, even young people. For example, the death rate for people 25–34 years old was 0.105%. Given there were 45.69 million people in that cohort, that means almost 48,000 of them died.

The death rate doubles in the 35–44-year range, and quadruples in the 45–54-year range.

Most companies offer free life insurance up to one or two times your salary. This won’t send your kids to college, but it will cover your funeral and any daily expenses while your loved ones pick up the pieces.

Cell Phone Assistance

This one isn’t as common, but many companies realize the importance that cell phones have in their employees’ lives.

I’m not sure about you, but my cell phone is more of a company tool that a personal gadget, especially when I’m out in the field inspecting facilities.

Check to see if you can get $20 or more towards your monthly cell phone bill. You may have to fill out a piece a paper or, gasp!, talk to your boss, but an extra $240 per year is nice.

Discounts

Most companies of any size have a list of discounts that are given to their companies from certain retailers. Some of the most common include cell phone subscriptions, travel destinations, and local restaurants.

They normally run in the 10–20% range, which you may not think is that much. But then again, you pay your cell phone bill every month. This starts to add up.

Here’s my example. My wife’s employer allows for a 17% discount on our ATT subscription. Our total bill has run about $120/month for the past 9 years that we have been married.

This discount has taken off $20 of our bill every month for the past 96 months, giving us almost $1,960 in that time.

$20 doesn’t sound like much. $2,000 sounds like a lot.

The Takeaway

If your company is anything like mine, you’ll probably get a small raise in 2022 to help with “cost of living”.

The thing is, with inflation rising higher and faster than in years past, your raise will actually lose you money.

For example, my (tentative) 2% cost of living increase when inflation is currently at 5% (or more) means my salary will be relatively smaller next year.

If you are in the same boat, you need to take advantage of every opportunity available to get ahead, or even stay afloat.

All you need to do is take a few minutes to explore your options, talk to your friendly HR department, and meet any criteria/qualification.

If you want to keep moving toward your ultimate goals in life, these small steps add up in a big way.

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This article is for informational purposes only, it should not be considered Financial or Legal Advice. Not all information will be accurate. Consult a financial professional before making any major financial decisions.