PTO payout - what would you do?

[adela76]

My current company has a benefit program I've never had before.  Once a year, you have the option to receive a payout for up to 80 hours of PTO.  Initially, I had no intention of using this benefit (I like to use my PTO for time off), but as I approach my 2nd anniversary with a comfortable PTO balance, I'm reconsidering.

-My company gives 26 days of PTO per year.  Before everyone gets excited, that's vacation time, sick time and holiday time (it's a healthcare company but I work a standard M-F schedule on the corporate side).  There are 6 mandatory holidays a year, plus 3 holiday-adjacent days that I will always take (i.e. day after Thanksgiving).  I maybe take 1 sick day a year (I can work from home when I'm feeling mildly under the weather), so to me it's like I have 16 elective PTO days a year.

-At the end of this year, after 2 years of employment, I'll have a balance of about 12 days (with 26 days to be accrued in 2020).  You can't have a balance of more than 26 days, so it's either use them, pay them out, or lose them.

-I don't travel much.  I did some expensive home projects this year, so I'm definitely not planning to do any multi-week or international vacations in the next couple years.  I mostly use my PTO for staycations, but some times I'll travel for a week or a long weekend.

-In the past, I believe they paid out at 100% of your salary, but starting next year it will only be 90%.

-My boss is kind of negative about PTO (she's a workaholic and never takes time off).  I'm not going to let her attitude stop me from taking PTO . . . but, I'd be lying if I said it didn't affect my thinking about it at all.  When I got back from a week off in July, she talked a lot about how she's so busy and could never take time off.  

Would you take the payout?  Or use all the time off?

[hoops902]

I would take the time off myself.  But I don't need the money, I have plenty of projects to do around the house, and I like to use my PTO.  10 years ago, I would have valued the money a lot more and taken the payout.  

It would matter to me when I could do the payout.  If it was at the end of the year, and I only had 12 days, I wouldn't pay out 2 weeks (10 days) because I'd be worried about running so low.

In short, I'd personally prefer the PTO, but that involves actually USING it.  If I thought there was ANY chance I'd max out on the PTO and simply lose it, I'd take some payout.

[travelnut11]

I'd take the time off. I'm at the point in life where time is more valuable than money and I use every last bit of my PTO. The people I work with who have maxed out balances confuse me.

[raeoflyte]

Maybe cash out 40 hours and schedule the rest? You basically have 3 weeks off. Its not that much. But better to cash out than lose it.

We have something similar where we can have up to 40 hours pto transferred to our 401k once a year that I do each year. I get 5 weeks pto though plus 11 holidays.

[steph08]

I would wait until next year to do the payout so you aren't left with just 2 days. If course, this depends on your accrual rate. Do you get all your days at once or so many hours each pay period, etc.?

I cashed out PTO at my previous job once or twice. I was getting 25 days of PTO each year in addition to holidays, and I decided to cash out a week or two to pay for a vacation. No regrets!

I can't cash out PTO at my job now, but it would be nice since I work from home a lot and don't use much PTO besides vacations and random summer days to take my kids to amusement parks.

[Deleted]

I would take it off, but 26 days including holidays and sick time doesn't sound like a ton to me. I get 31 if you add all those up and can't wait until next August when I start accruing an additional 5 days a year.

I use a lot for kid things though. After they're gone it might seem like a lot more.

[Ava]

I would take the time off. 

The thing with work is that once you start doing something, it becomes expected that you continue.

For instance, we just went through an audit. I worked my tail off for that. I arrived a few minutes early, took a quick lunch and continued working, etc. But I always made sure I left on time. If you suddenly stay late, then it's expected you stay late. Furthermore, if you stop at some point, they become angry you are not there past your work time because you got them used to that. It's 7pm and you still answer the phone, answer emails and continue working. Then one day it's 5pm and you leave. Expect backlash from that. Been there, done that, got the t-shirt, never again.

I don't get paid overtime. I owe the company eight solid hours of work M to F and that's what they get from me. So don't create that sort of expectation. Particularly with a workaholic manager.

In your case, since you have nothing planned, I would take one day off every week or every other week.
It's amazing how much you recharge and relax with just one day here and there. Plus, time is something you will never get back. You can always make more money if you need to.

[tcu2003]

I’d take the cash. My company offered that benefit until this year (well, this year is the last year we can cash out PTO). I end up flexing a ton of days throughout the year - I’m salaried, so if I have 80 (or more) hours in a pay period, then I don’t need to use PTO for any days off that period. This year I took several 3 & 4 day weekends, a 9 day vacation to Florida, and an 11 day back-to-Back trip to Texas and Colorado. I still ended up with probably 50 hours to cash out. Next year we can’t cash out PTO and the amount we can carry over is decreasing. I have the option to cash out an additional 40 hours (that’s the amount my carry over allowance is decreasing) and I opted to cash out the 40 hours. Realistically, I’m not going to be able to take off that much time, so I might as well reap some benefit.

[NoNamePerson]

Sept 21, 2019 8:44:18 GMT -5 Ava said:

I would take the time off. 

The thing with work is that once you start doing something, it becomes expected that you continue.

For instance, we just went through an audit. I worked my tail off for that. I arrived a few minutes early, took a quick lunch and continued working, etc. But I always made sure I left on time. If you suddenly stay late, then it's expected you stay late. Furthermore, if you stop at some point, they become angry you are not there past your work time because you got them used to that. It's 7pm and you still answer the phone, answer emails and continue working. Then one day it's 5pm and you leave. Expect backlash from that. Been there, done that, got the t-shirt, never again.

I don't get paid overtime. I owe the company eight solid hours of work M to F and that's what they get from me. So don't create that sort of expectation. Particularly with a workaholic manager.

In your case, since you have nothing planned, I would take one day off every week or every other week.
It's amazing how much you recharge and relax with just one day here and there. Plus, time is something you will never get back. You can always make more money if you need to.

I always said everyone notices if you come in a few minutes late but not one damn soul notices if you STAY late.

[Lizard Queen]

I like to actually use PTO, but in your case, I think cashing it out just this one time makes sense. But then, enjoy your vacations and ignore your boss. It's her problem, and her comment was likely only about herself and not a complaint about you.

(I used to have 6 weeks combined, plus 8 holidays. One of the few good things about that job.)

[geenamercile]

I think I would do a combination.  Cash some out to pay for what ever I took the others for.  

[alabamagal]

I would carry over a week or so just in case you had a lot of sick days and cash out the rest.

I would love having flexibility to cash out extra PTO. I worked for a large company that would not allow carryover or payout, it was use it or lose it. Near the end I was 6 weeks vacation (sick time separate) plus 10 holidays, and I could not afford to go on actual vacation for 6 weeks. They were having discussions about improving workplace and giving new people more vacation, so I asked about letting us with a lot of vacation cash in some, but no go.

[Tiny]

I've been at my job a very long time and accrue a lot of PTO. I can bank 30 days of PTO. I am currently accruing 30 days a year. I can't manage to use it all - especially since about 7 years ago I let my bank get too high and couldn't use it up without impacting my work schedule. It was stressful with the use it or loose it thing hanging over me. I didn't want to loose the pay if I couldn't take the days off. I do carry about 10 to 15 days in my bank these days. I DO take advantage of the 5 days of PTO buy out every year.

In the past, I used the payout $ to help paydown the money I borrowed to do repairs on my "fixer upper" house. In the past I've used the payout to put towards a roth, to bulk up my after tax savings, or to pay off $$ I borrowed for an investment property (downpayment or repairs). Since the payout is a known amount (along with a holiday bonus and a merit bonus) I tend to fact it into my yearly "Financial Plan".   I also do a yearly "Use up PTO time plan" and come up with days off that I am taking (since I don't take a 2 week vacation - usually just 1 week - it helps if I take 1 or 2 days off each month). 

All of that said. My advice to the OP would be to think about the next year and see what's on your horizon: how will you use your PTO? If you plan to take some/all of the buyout - how will you use the money? (fritting is fun - but it can also be a waste).

My advice for this year would be to take 1/2 (40 hours) as a buyout. Be prepared - the tax amount will be astronomical, your 401K contribution may also come out of it. It might not be as much as you expect. Have a purpose for the money (beyond frittering ALL of it). Make that week of work you did to earn it - worth it.

[Tiny]

-In the past, I believe they paid out at 100% of your salary, but starting next year it will only be 90%.

What does this mean? Can they pay you less for the hours you worked (when you didn't take the days off? - in otherwords they will pay you more to take a day off) OR does this mean they will be taking a higher Federal tax or will be taking contributions to your 401k/pension from this pay out?  (taxes/retirement contributions are OK... less pay for work done is NOT.) 

If they are docking your pay - first thing I would do is schedule a day off every other week starting ASAP, I'd schedule a couple days around the Holidays at the end of the year immediately, and then start thinking about 2020 and start plotting out how you will manage your "PTO bank" - so you always have a balance of 4 or 5 days - and then regularly use up the excess.   

ADDED:  What kind of health care bennies do you have? If you forsee having a baby:  Can you use accrued PTO with maternity leave (so extend your time off?) Is accrued PTO the only maternity leave you get?   What about with short term disability? Do you have to use up PTO first?   If so, it might help to keep 10 days in your bank....  

You want to determine how to maximize your PTO, and PTO banked time. 


FWIW: when I was at the PTO bank limit AND accruing 2 days a month - I managed to schedule in 3 days off a month - with 5 days off once a quarter to try to get the balance to a manageable level (along with a 5 day buyout).

[Knee Deep in Water Chloe]

My husband has this option as part of his contract. He has 20 vacation days per year—not including personal and sick days.
He is allowed to take up to five of them at his daily rate of pay. He asked for more, but his board denied that saying he actually needed to take a break. His days do not roll over from one year to the next though. He’s taken five days of pay In lieu of days off every year for the past five years that he’s had this option. I use the money for what little vacation we do go on.

[andi9899]

I'd take the cash personally.

[Anne_in_VA]

My former company had this program and you were only allowed to accrue 92 hours but we’re only allowed to carry over 40 hours of PTO, and I think they have now decreased the carryover amount.  The payout was $.50 for each dollar of PTO time.  Because of the low reimbursement amount, most people tried to use up their time towards the end of the year.  

[wvugurl26]

I would use as much time as possible. I have my time planned through the end of year. I'd like an extra day to use the Wednesday before Thanksgiving. I find it easier to take a day or two for something I want to do or making my life easier than a week at a time.

[Cookies Galore]

I get almost eight weeks of PTO and you're damn right I use it each year. I reserve five days to use for sick time and since I usually don't need it I carry it over.
I take a lot of Mondays off because I work from home Fridays and Tuesdays.

[raeoflyte]

Sept 22, 2019 15:42:38 GMT -5 Cookies Galore said:

I get almost eight weeks of PTO and you're damn right I use it each year. I reserve five days to use for sick time and since I usually don't need it I carry it over.
I take a lot of Mondays off because I work from home Fridays and Tuesdays.

Your job has always sounded like the absolute best employer. I'm jealous!

[Deleted]

The first company I worked for let us buy vacation.  I never did back then when I was young and poor, but I'd LOVE to have that option now.  

[Cookies Galore]

Sept 22, 2019 17:00:38 GMT -5 raeoflyte said:

Sept 22, 2019 15:42:38 GMT -5 Cookies Galore said:

I get almost eight weeks of PTO and you're damn right I use it each year. I reserve five days to use for sick time and since I usually don't need it I carry it over.
I take a lot of Mondays off because I work from home Fridays and Tuesdays.

Your job has always sounded like the absolute best employer. I'm jealous!

They have their moments! Reading about other people's experiences with their employers helps keep any grumbling in check.

[Miss Tequila]

I value my time off way more than money so I would take the time.  I am also at a point where I do not care if I work for a workaholic.  BTDT and not going back to it. Don't get me wrong, I'm in Finance so that is never going to be a strictly 40 hour a week job, but I try to be as efficient as possible and take advantage when I have nothing looming over me.  But give up vacation/PTO days?  Never

[justme]

Cash out 40 hours (5 days) and use that to pay for a 7 work day holiday. 

[justme]

Sept 22, 2019 15:42:38 GMT -5 Cookies Galore said:

I get almost eight weeks of PTO and you're damn right I use it each year. I reserve five days to use for sick time and since I usually don't need it I carry it over.
I take a lot of Mondays off because I work from home Fridays and Tuesdays.

Ummm...do they want any virtual workers. Damn, I'd kill for 8 weeks of PTO. I'm counting down the months until I get my 4th and I cringe at starting a new job with less. 

[haapai]

I have to ask these questions just to be sure what your options are. 

Does the PTO accrue gradually, ie. one day off for every two weeks of work, or does it accrue in clumps of 26 days? 

Additionally, is there a set calendar date on which you must make a decision to take a payout or is it something that you can exercise once a year at your discretion? 

[Cookies Galore]

Sept 26, 2019 13:04:55 GMT -5 justme said:

Sept 22, 2019 15:42:38 GMT -5 Cookies Galore said:

I get almost eight weeks of PTO and you're damn right I use it each year. I reserve five days to use for sick time and since I usually don't need it I carry it over.
I take a lot of Mondays off because I work from home Fridays and Tuesdays.

Ummm...do they want any virtual workers. Damn, I'd kill for 8 weeks of PTO. I'm counting down the months until I get my 4th and I cringe at starting a new job with less. 

I also have a 35-hour work week. I truly am stuck here for life (it's been 10 years so far).