If your boss gives you a paystub every pay period, then you should be reading it.
No matter what you do for a living or how financially comfortable you are, it’s good to know how much you’re getting from your employer and where that money goes. Sadly, most people tend to throw them in the trash or shred them without a glance.
In this post, we’re going to tell you 4 reasons why you should always read your pay stub. Taking a few minutes to make note of what you’ve been paid and the deductions that were removed from it will give you a much clearer picture of your finances.
1. Important for Budgeting
If you want to be careful about bills and expenses, then you’re going to need to budget well. One of the best ways to create a budget that you can stick with is by keeping a close eye on your pay stubs so that you know what’s coming in and going out of your bank account.
When you put the blinders on, you’re essentially flying by the seat of your pants. Unless you’re making really good money, you could run into a situation where you don’t have enough in the bank to cover rent, your various bills, and other expenses. Even when you’re comfortable with money, it’s good to keep a budget.
2. Make Sure You’ve Been Paid Correctly
The most obvious reason to look at your pay stubs is to make sure that you’ve been paid the right amount for the work you’ve done during the pay period. It may not be a case of your boss trying to short change you, but mistakes do happen and you’re only going to catch those by looking.
3. Important for Tax Season
Filing taxes can be a complicated and annoying process, which is only made worse when you don’t have all of your work documents. Your boss will likely give you a W-2, but your pay stubs can be a huge help in making sure your taxes are as accurate as possible.
You should also check them every pay period to ensure that you’re being taxed the right amount. If you have been charged too much, you may be able to get a refund from the IRS.
4. Checking On Your Benefits
Many people, both in salaried and hourly positions, pay into benefits. These payments come out of every single paycheck and fund things like healthcare, dental, and your 401k. It’s important to know how much money you’re paying into these programs so that you have a good understanding of what you’re entitled to.
To create legit paystubs, your employer needs to verify with you that the correct amount of money is being deducted for taxes and benefits, so you need to check them every time in order to hold them accountable.
Read Your Pay Stub
Try to make a habit of reading your pay stub when you get it. It’s not the most exciting thing in the world, but it’ll help you keep your finances in order and help you stay out of tax trouble.
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