Finding good people can be difficult, however, keeping them with your company can be an equally daunting challenge.  If they are valuable to you, they would probably be just as valuable working for a competitor.

Selective employee benefits are just that, benefits that don't need to be shared with the rest of the employees.  These types of benefits can also include "golden handcuffs", where the employer and employee exchange promises.  The employee commits to stay with the company for "X" number of years and the employer commits to giving the employee an incentive only if the employee completes his or her end of the promise.  It's win-win for both parties.

The cost of these plans can vary greatly, but it is controllable by the employer and depends on how large of an incentive you want to provide.  Little incentives can go a long ways to showing your key employees you care about their future and value their contribution.

If done correctly, your benefits will serve as an effective way to attract and retain good employees without becoming a major burden to the bottom line.  Unfortanetly, this isn't the case in most businesses as their health insurance costs impact the business's profitability.

Two Main Types of Employee Benefits:

1. Traditional Benefits

2. Selective Benefits

Traditional Types of Benefits:

Medical Insurance: Providing health coverage for your employees is likely your largest employee benefit expense.  It's so important that it has its own section.  The good news, by effectively structuring your medical benefits, it is often possible to "find the money" for other benefits.

Disability Income: Both for short term and long term needs, this can be an effective way to protect your employees in case they get sick or hurt.  Most Americans are only a few paychecks away from bankruptcy, so you can see why this is a valuable benefit.

Life Insurance: Providing this benefit can help protect loved ones if something were to happen and pay for final expense costs.

Retirement Plans: As many baby boomers move toward retirement with little savings, employer sponsored plans in small businesses are getting more attention.  Employee education is crucial for getting good participation.

Voluntary Benefits: Voluntary benefits are completely employee paid.  The advantages to the employees are the convenience of meeting their benefit needs currently not offered by the employer and often times at a discounted price compared to getting coverage on their own.  The employer typically gets a tax benefit by offering this option.