No matter if you’re about to use a paystub maker for one paycheck or multiple paystubs at a time, there are a few things to never miss out on. Anyone can create a paystub online, but not everyone is attentive enough to ensure what obvious information to look out for.
We’re here with a quick brief on the important aspects of paystubs that you should know. It is for anyone who creates or receives paycheck stubs. After all, your paycheck is your earning statement & if it does not have essential details, it is of no use. Don’t you agree?
5 Important Parameters of Paystubs to Keep in Mind
Here are the five critical details that must be present on your paystubs. You should care for them whether you opt for DIY payroll making with a paystub generator or get it done by any third party.
How are you paid?
Usually, the pay period may be weekly, bi-weekly, monthly, semi-monthly, or annual. This applies differently to the employees based on their work agreement. It directly impacts other factors like hourly rate or salary. For instance, if you’re working every week, your payment is calculated based on the total number of hours worked during the week. Similarly, salaried employees have a fixed monthly salary that they’re paid at the end of the pay period.
Thus, it is the very first thing you should verify on your paycheck stub. Make sure your hourly/salary rate is accurate as it forms the basis of other calculations.
Also see: Complete guide on tax preperations
No information on your paycheck stub is asked for unintentionally. This thought applies to marital status too. Married employees may be provisioned with certain financial benefits that unmarried employees are exempted from.
These benefits usually include some allowances or provisions for your family. Now you know why your employer asks for your marital status.
Check stubmaker has this option for you whenever you’re up for creating a paystub. You have to select whether your employee is a contractor or an employee.
Why is it important to mention the employee type on the paycheck? The reason is contractors (independent workers, self-employed people, or freelancers) are exempted from benefits received by employees. Also, employers cannot deduct taxes from their pay. This simply means that contractors have nothing to do with bonuses or deductions. The scenario is different for employees. They’re provisioned with bonus & allowances and also tax deductions are made from their pay.
Benefits & deductions
So what if your ‘employee type’ is properly selected, you should keep an eye on what benefits/allowances you have received. Similarly, you should verify the deductions made from your paycheck. Don’t wait for your W2 form online to arrive from your employer. Confirm these amounts with every paycheck you receive.
For example, your deductions include federal tax, state tax, FICA deductions, etc. Even if your employer opts for an automated calculator tool, you may choose to verify if such deductions are as per the IRS. It will help you keep a better grip on your pay.
Gross Earnings Breakdown
Finally, gross earnings breakdown is something most employees don’t bother to check. You may be receiving certain bonus amounts. Also, you have worked overtime & you must see if you’re being paid overtime accordingly. Nobody is going to tell you all this. It is you who has to refer to the details mentioned in the gross earnings section.
Your take here is to keep a rough record at your end with which you can verify your gross earnings amount on the paycheck you receive.
That’s all folks!
Follow the good practice of paystubs & you’ll get better at budgeting & money management too. If you have not been doing this to date, start doing it from now onwards. Better be late than never.