Of course, when you receive your paycheck, you aren’t very worried about the piece of paper attached to it. Obviously, the money you just received is just a little more exciting, justifiably.
However, it is actually quite important to read and understand your paycheck stub. You may say you look at it, but if you don’t truly understand what you are seeing it won’t help your cause.
Keep reading to learn the big importance of reading and understanding your pay stub.
Obtaining Your Paycheck Stub
Now you’re stressed because you want to know, but you either don’t receive a paycheck stub or you haven’t a clue where they are. Right? It’s okay!
If you know where you work, which you do, you can generate your own real check stubs and print them on the spot. Whew!
Now we’re back in business.
Why You Should Read Your Paycheck Stub
Did you know that in 2018, more than 50 percent of Americans had reported an error on their paystub? Yes, that’s half!
No one wants any type of error on their paystub, ever. If that isn’t reason enough, I don’t know what is.
You may now be asking, what if you don’t know how to analyze your stub to even know if there is an error?
Reading pay stubs is simple when you break it down. Let’s do it!
Reading Your Pay Stub
Your gross pay is what you earned before any taxes being taken out. This is not what you receive, but it is the figure used to determine what is withheld.
There are multiple tax with holdings that are deducted from your gross pay. This always includes federal tax withholding, Medicare, and social security.
Your deductions may also include state tax withholding, local tax withholding, and health insurance if your employer offers coverage.
Possible Errors to Look For
One of the most common issues on a pay stub is that the gross pay is incorrect. This can occur if hours are not calculated correctly or if you worked overtime, but were not compensated.
An error could also be that the amount taken for taxes or insurance is incorrect. This may result in too much being taken. On the other hand, if too little is withheld, you could then owe unexpectedly when it comes down to tax time.
If you do notice a discrepancy on your paycheck stub, notify your company’s HR or payroll department. In the case that more serious action needs to be taken, they will assist you in getting in touch with the right person.
Keeping Up With the Pay Stubs
Well, there you have it. Now you know that your paycheck stub really is more than the slip attached to your paycheck and how crucial it is that you look at and retain them.
As always, check out our blog for more tips and the latest in happenings from all around the world!