Author Topic: How to maximize work benefits  (Read 1390 times)

Murse

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How to maximize work benefits
« on: November 15, 2019, 11:49:15 AM »
Just got a new contract with the employer (union.) new contract states we can now cash out vacation. I am due for a nearly 5% raise in May as well and 3% in October. A separate benefit we have allows us to bank overtime as comp time. 1 hour of OT is equal to 1.5 hours of time off due to it being at the overtime rate.

Big picture our goal is to work full time for another couple of years then to switch to part time and let our nest egg grow. My point in adding this is that we will likely work at least on a part time basis for more than 20 additional years.

My thinking with this new contract is to bank my overtime, use it for vacations and time off, then when I get a raise I can cash out the vacation at the new higher rate. I am looking at this as a risk free investment. So now to the scenario because I have been banking it for awhile-

I am currently only 44 hours away from having the maximum allowed vacation and I accrue it at a rate of 10 hours/month. I am 30 hours away from being maxed out on comp time as well. I am picking up a 10 hour OT shift tomorrow and am unsure if I should take the cash now or bank it and cash out vacation in January or February. Tax brackets should not be different from this year to next year although I am expecting to make about 10% more next year not including any vacation cash out.

My wife and I file MFJ, our income in 2019 I expect to be around 130k and 2020 around 140-145k prior to cashing out any vacation.

Obviously the best thing to do would be to save as much compensation banked as possible so that I could cash out in October after the 3% raise but this becomes a very slippery slope. I have 3 years of raises lined up in May of each year (about 5% each) before being topped out.

The last point I would like to make is that I do take vacation every year, I have been able to take all the vacation I desire while using comp time. The limitation here is that my wife’s work does not have the same kind of generous vacation time I have so even if I wanted to take more time off work, it would not be for anything other than an extra day off.

I guess there are 3 arguments that can be made-
1) Take the compensation now
2) delay the compensation as long as possible to get the best ROI
3) if I’m going to work an additional 20 years and the additional compensation makes no difference in the FI date then I should use the vacation as vacation.

What do you think?

friedmmj

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Re: How to maximize work benefits
« Reply #1 on: November 17, 2019, 04:17:34 PM »
You mentioned that your wife doesn’t get as much vacation time.  If it were me, I would take some staycation days and prepare some nice meals for your wife or get some projects done around the house to free up weekends for when you are both able to share leisure time togetherness

 

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