How To Read a Pay Stub

It’s essential to verify that each of your pay stubs contains your correct name, tax deductions, Social Security number, vacation balance and pay rate. In addition, you should make sure your benefits deductions — including your dental and health insurance and 401(k) plan — are accurate so that you can confirm you’re properly enrolled.

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Although companies print different kinds of paychecks, the law requires they all contain certain information. Pay stub abbreviations can be confusing, so keep reading to learn how to decipher your pay stub. Bonus: you’ll also glean valuable information that might help you improve your money management.

What Is a Pay Stub?

Your pay stub is the part of a paper paycheck that you keep after you cash or deposit the check. Typical information that appears on your pay stub includes the number of hours you worked during the pay period, the gross and net amounts you earned, a breakdown of federal and state income taxes you paid, any employment tax and a list of tax deductions.

Keep Reading: 50 Mindless Ways You’re Burning Through Your Paycheck

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How To Read Your Pay Stub

The different numbers on your paycheck might seem mysterious if you don’t know what they represent. Here’s a full breakdown of a pay stub so you can understand exactly what do with your paycheck:

  1. Employer/Company Address: The name and address of your employer
  2. Employee No.: Your unique ID number at your place of employment used by payroll managers instead of your full name
  3. Employee Name: Your name
  4. Social Security No.: Your Social Security number
  5. Period Beg.: Date the pay period began; “Beg.” stands for “beginning”
  6. Period Ends: Date the pay period ended
  7. Check Date: Date the check was issued
  8. Earnings: The type of income you received, which can include regular pay, overtime pay or other types of wages
  9. Hours: The number of hours worked during the pay period if you are an hourly employee — left blank for salaried employees
  10. Rate: The hourly rate and number of hours worked if you’re an hourly employee, as well as any bonuses or commissions for the pay period
  11. Current Amount: Amount you’ve earned during the pay period before withholding and deductions
  12. Withholding/Deductions: Federal and state taxes taken from your gross earnings for inclusion on your W-2, including Social Security, Medicare and W-2 withholding tax
  13. Current Amount: An itemized list of withholdings and deductions for the pay period
  14. Year to Date: The period starting from the beginning of the year to the present; the figure represents your itemized deductions during that time period
  15. Current Amount: Your gross earnings during the pay period before any withholding and deductions have been taken out
  16. Current Deductions: Amount of deductions — possibly including 401(k) or other retirement savings plan contributions — taken out during the pay period
  17. Net Pay: Amount of take-home pay, or your pay after tax, after all deductions have been taken out
  18. YTD Earnings: Amount of total earnings for the year to date, from the first of the calendar year up to and including the pay stub’s pay period
  19. YTD Deductions: Amount of your total deductions from the first of the calendar year up to and including the pay stub’s pay period
  20. YTD Net Pay: Amount of total net pay earnings from the first of the calendar year up to and including the pay stub’s pay period
  21. Check Number: The check number for the specific payment

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Gross Pay vs. Net Pay

You might be confused about the difference between your gross earnings and net pay. Gross pay is the total amount of income you earned during a pay period, which is typically one month or two weeks. Gross pay doesn’t factor in your tax withholdings, like federal income tax.

Net pay is the amount of take-home pay you get after all your taxes and withholdings have been deducted, which includes your federal tax deductions. In other words, net pay is the actual amount of money that you deposit in the bank.

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Save Paycheck Stubs

If you need more help reading your paycheck stub or if a particular calculation doesn’t seem correct, get assistance from your HR department. Your pay stub contains important pieces of information and you should understand each piece. It’s also crucial that you check your stub to make sure it’s accurate — and let your employer know if there are any mistakes.

Your paycheck stub serves as proof of income and government agencies, lenders and landlords often request them to verify your earnings. A pay stub contains all your income information, so it’s a great tool for tracking your salary, the taxes you’ve paid, insurance premium amounts, bonus information and vacation and overtime pay. It’s important to save your pay stubs in case you need them for anything that requires income verification.

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Last updated: Sept. 21, 2021

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About the Author

Barri Segal has 20+ years of experience in the publishing and advertising industries, writing and editing for all styles, genres, mediums, and audiences. She has been writing on personal finance topics for 12 years and gains great satisfaction from making a difference in consumers’ lives.
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