5 Lessons Learned:
The Importance of Understanding Your Pay Stub
Most of us are excited to receive our paychecks at the end of a certain period of time. Most of the time, we deposit our paychecks without question and without checking our pay stubs. The reality is that there are times when human error can cause mistakes in the amount that is reflected in your paycheck. If you don’t pay attention to your pay stubs, you might not be aware of losses in your income because of these errors.
To protect yourself so that you can earn the exact amount that you deserve to get, then you need to understand your pay stub and study it every time to make sure that it is correct. It has been reported that half of the employees surveyed found mistakes on their paychecks. Understanding your pay stub can help ensure that you are getting the right amount of money on your paycheck.
The tips below will help you examine your pay stub.
The first thing you should do is to scan each section. These sections include your employee information, the pay period, YTD or year-to-day, gross pay, and net pay. Ensure that the items in your pay stub are all correct.
You also need to understand everything in your pay stub. There are many things that are not included in your paycheck. Here are some of them.
There are pre-tax deductions that are removed from your salary. Health insurance and retirement account money are some of these items. Not taxing these items can save you money.
Employer contributions are what your company pays for like part of your insurance or part of your retirement fund.
State taxes, federal taxes, FICA taxes, health insurance, health savings account deductions, and retirement account are amounts taken from your paycheck.
Next, you need to check that all the numbers are correct. Human error is possible like entering your numbers wrongly. When paystubs are printed, the error is already there. Don’t blame your printer; it is just printing the errors already committed beforehand. It is either you made a mistake when you input your hours or somebody else made an erroneous entry. It is not impossible to control this. Always check your pay stub for errors. Your number of hours and the rate should always be checked. Check also if the tax withholding amount is right.
The possibility of human error is high. This is the reason why you need to understand and to check your pay stub. This will not take much of your time. IF you don’t want to lose money on pay stub errors, then you should make sure to check it every time.