How to read a paystub?

Welcome to the world of paystubs! If you're like many people, the sight of one of these documents might send you into a bit of a panic. All those numbers, codes, and abbreviations can be overwhelming, and trying to make sense of it all can feel like deciphering a secret code.

With a few helpful pointers and a little bit of practice, you'll soon be able to read a paystub like a pro. In this article, we'll break down the important information to look for and where to find it

1. Pay period: Calendar days included in the paycheck. Your employer sets up the schedule of when you are paid.
2. Current gross income: Total pay before taxes and other deductions are taken out.
3. YTD (year-to-date): Summary of total gross income, other income, deductions, and net income since the start of the calendar year.
4. Net income: Amount of money you receive in your paycheck after taxes and other deductions are taken out; also called take-home pay.
5. Federal tax: Amount withheld for federal income tax. This is deducted each pay period so you do not have a large tax bill when you send in your personal tax return.
6. Federal Insurance Contributions Act (FICA) Social Security tax: Amount withheld by your employer to pay your Social Security tax. The rate for Social Security is 6.2%. You and your employer contribute to Social Security; your paycheck shows your share.
7. Medicare: Amount withheld by your employer to pay your Medicare tax. The rate for Medicare is 1.45%. You and your employer contribute to Medicare; your paycheck shows your share.
8. State tax: Amount your employer withholds to pay your state income tax. (Not all states have income tax.) This is deducted each pay period so you do not have to pay a large amount when you file your tax return.
9. Employee Deductions: Taxes, insurance premiums, and the cost of other programs that are subtracted from your gross income.
10. Employer Contributions: If you have a privately paid health insurance plan, your premium will show here