When considering a job offer, which perks do you weigh? High salary, vacation policy, stellar health insurance… But what about catered lunch? Free lunches probably never crossed your mind as a deciding factor when accepting a specific job, but that may be because you’re not doing the math.

During the interview process, you’ll want to ask whether the company has shared meals. Here’s how to appropriately evaluate the answer you receive, so you can make the best job choice for you.


1) Consider Savings on Food


The Cost of Eating Out

How much does your lunch cost you? Nowadays, well-balanced lunches usually start around $8-$10 – depending on your diet, cuisine preferences, and city. But that’s not the end of it. Once you consider ingredient substitutions, tax, tip, and beverage, that number gets much higher. Does your heart skip a beat when the final total comes to $14-$16? You might be screaming on the inside, “But all I bought was a burrito and a small soda!”

$15 a day may not feel like a lot when looking at the smaller picture, but salary would look low if it were in the form of a daily value too. If you do the math for how much a $15 work lunch would save over the course of a year, you’ll see that buying lunch outside of work really starts to add up. Your daily $15 lunch over 45 work weeks (to account for holidays, vacation, and sick time) comes to more than $3,300!

And the healthier the lunch, the more it can cost. Let’s say you’re being careful about what you eat – whether for health reasons or because of an upcoming wedding or Tough Mudder. That daily lunch may well come to $20, because the cost of superfoods like acai or quinoa can be quite high. At that rate, a daily lunch with dietary restrictions comes to $4,500 for the year!

If a company caters breakfast or lunch for its employees, this total can be “added” to your yearly salary. A $50K offer with lunch is then similar to a $55K opportunity without it.


The Cost of Taxes

But don’t forget that these numbers are different in one very significant way: taxes. If your company provides $5,000 worth of food for you, you pay no tax on that. That $3,000-$5,000 in free lunch value that you receive is not part of your tax bill, unlike $3,000-$5,000 in salary. In other words, $55K in salary is worth less than $50K in salary plus $5K in free lunches.

To use a specific example (and a tax estimating calculator), a $55K salary could mean you pay $15K in federal, state, and local taxes.* On a $50K salary, that would be $13K in taxes. So, you’re only getting $2,134 in your pocket from a $5,000 salary bump, but you get the full $5,000 value from free food.

Moreover, many companies don’t offer lower salaries just because they are providing catered food. After all, office meals are a benefit that boosts productivity and improves company culture. So, more often than not, you won’t need to make a choice between lower salary and lunch provided by the office; you can have both!


The Cost of Bringing Lunch

But maybe you bring your own lunch to work each day, so you’d rather have the higher salary since packing your own lunch will cost you much less than $5,000 per year. However, the tax question still applies here. If you purchase cheaper ingredients with your post-tax salary, they may cost the same as eating food provided to you, on which you pay no taxes.

And remember that many cities have a sales tax for food purchases, so you’d be paying both income tax and sales tax on your food ingredients. If your company provides lunch, then you don’t have to pay for either of those. Using the math from above, that $2K you gain from a $5K higher salary would then be taxed when you buy groceries. For example, New York’s 8.875% sales tax rate would mean that your $2,134 becomes $1,960. $5,000 in free food sounds a lot better than $1,960 in cash you use to buy food.


Credit Card


2) Account for Time Savings


The Cost of Traveling

Also important, a lunch catered by your company saves you a lot of time.

When you don’t have to travel and wait for your food, you can spend that time in other ways. When eating out, it takes time to decide where to go, walk to the restaurant, wait for your food, and walk back to your office. This can take anywhere from 15 to 30 minutes, depending on the distance and wait time.

If you multiply even just 15 minutes of waiting and traveling by 225 workdays in a year, it comes out to 56.25 hours of extra time that you could be using in other ways. Consider the monetary value of that time spent getting lunch. If your hourly rate is about $20 an hour, those 56.25 hours translate to $1,125 of time saved over the course of a year! The financial benefit becomes $2.3K if your rate is $40/hour.

And if you work somewhere that requires you to drive to get your food, don’t forget to account for the gas, parking, and other costs associated over those 225 workdays. At an average per-gallon gas price of $2.29, a 3-mile round trip to pick up lunch in a car that gets 22 MPG (average for the US) comes to $70 per year.

However, you don’t have to trade 15 minutes of getting lunch for 15 minutes of work. You could instead use that saved time to improve your health with a break for meditation, socializing, or exercise. Instead of taking time to do a chore (picking up a meal), you can take that time to call a friend, to stretch in your seat, or to escape to a quiet corner of the office for some deep breaths. The value of these activities are harder to quantify but potentially much more impactful.


The Cost of Preparing

You might be thinking that this doesn’t apply to you, since you bring your own lunch to work. No need to drive anywhere, saving both time and money. Unfortunately, that fails to account for the time you spend getting groceries with which to make your lunch and the time you spend preparing, packing, and heating said lunch. If it takes you 1.5 hours to buy, prepare, pack, unpack and heat your food, that’s 18 minutes per workday. At a $20 hourly wage, that’s $1.4K of time lost in a work year.

Aside from the time costs, bringing your own lunch also makes flavor fatigue a bigger issue. The time efficiency of making one or two dishes and portioning them for each workday is likely to make you bored of the same meal each day. By comparison, catered lunches can be specifically planned to be different every day, avoiding that taste fatigue.

Another unfortunate drawback to bringing your lunch is that you can’t spend time with the rest of your crew when they leave for lunch. You could join them, but it might be awkward if you walked into a restaurant with your own lunch. Then comes the curse of “food envy” when you have to watch everyone else eat something that looks way more amazing than your bagged lunch.



3) Remember Less Tangible Savings

In addition to both money and time savings, don’t forget the less tangible savings. Specifically, remember how much more you can enjoy a job that includes shared meals.

A lunch with co-workers helps build camaraderie and trust, which foster effective collaboration and job satisfaction. Lunch together prompts the sharing of stories, which uncovers common ground – even with people you might not have approached on your own. That could help you find a friend for life or just give you something to look forward to. This teamwork and positive feeling bears fruit in many ways.

Catered meals help build a strong company culture. That can make it easier to attract other fun, talented people to your team; a good culture builds on itself. When recruiting new team members is easier and less costly, those dollars can be reinvested into employee retention or into the business itself.

Moreover, if your company offers revenue sharing – whether stock options or bonuses tied to company growth or something else, catered lunch can increase the value of your chunk of the pie. For example, research suggests that “companies with engaged employees report 2.5x more revenue than competitors with low engagement levels.” Therefore, a company culture of engagement can translate to a much higher bonus for you.

Cost of Lunch
Cost of Daily Office Lunch
Catered Lunch Salary Trade-Off

So, if you’re considering a new opportunity or weighing the value of your current job, remember to account for catered meals. Considering the money and time you save when a company offers it, it’s evident that a catered lunch is, indeed, a substantial perk.

By taking a job that includes lunch catering, you could save $3-$5K on food and $1.3-$2.5K worth of time – in addition to significant savings that are harder to quantify. That comes to $4-$8K of value, even before accounting for intangibles. That unspent money could constitute a pay bump, a hefty deposit, or even a “just-for-me” fund! As long as it’s not spent on lunch, it’s more money in your pocket.


*Assumes no interest, living in New York, etc.


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