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Understanding Paychecks

Understanding Paychecks. Where Does Your Money Go?. Pay Check Stub. Check Stub -the part of a paycheck that lists deductions from your salary. Personal Information. Personal Information: Name Social Security Number Address. Pay Period. Pay Period

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Understanding Paychecks

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  1. Understanding Paychecks Where Does Your Money Go?

  2. Pay Check Stub Check Stub -the part of a paycheck that lists deductions from your salary

  3. Personal Information • Personal Information: • Name • Social Security Number • Address

  4. Pay Period • Pay Period • The length of time for which an employee’s wages are calculated; most are weekly, bi-weekly, twice a month, or monthly • The last day of the pay period is not always payday to allow a business to accurately compute wages

  5. Gross Pay $1,353.33 • Gross Pay • The total amount of an employee’s earnings BEFORE deductions are taken out • This is calculated by multiplying the number of hours worked by the hourly rate

  6. Net Pay $1,102.98 • Net Pay • The amount of a paycheck AFTER all deductions are taken out (sometimes referred to as take home pay)

  7. Deductions • Deduction • The amount of money taken from an employee’s gross pay for taxes, insurance, social security, and other benefits

  8. Required Deductions Federal Withholding: taxes taken for federal funding State Withholding: taxes taken for taxes for state funding Social Security: retirement/disability benefits Medicare: health care program for elderly/disabled Income Tax: the part of earnings that people must legally give to the government to pay for government services

  9. Optional Deductions (Medical) Insurance: Can get insurance through employer 401K: Personal retirement

  10. Current vs. Year to Date $250.35 $1,502.10 Current: the amount paid for each deduction THIS pay period Year-to-Date: the amount paid for each deduction so far THIS YEAR

  11. Pay Check Math GROSS PAY: $1,533.33 TOTAL DEDUCATIONS: $250.35 NET PAY: $1,102.98

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