The Pay Stub Meaning: What Information Is Included on Your Paycheck?

Every pay stub has a lot of information about your income and taxes. But what does it mean and how do you know if there's an error? Here's the pay stub meaning.

These days, there's a lot of different ways to get paid. You might get a check from work, a direct deposit into your bank account, or your employer might literally send cash right into your PayPal account. 

The only downside to all this change and conviencne is that many people no longer know how to read a paystub. Paystubs contain a lot of information about your income and your taxes.

Being able to read a pay stub can help make sure you're in the know about how you're getting paid. And if you can't discern a pay stub meaning, you'll have no way to tell if there's an error.

Read on, and we'll walk you through what information is on that little paper slip. 

What's Included on a Pay Stub?

Pay stubs contain all the information you'll need about your current pay period's wages. Though your particular pay stub may vary in some small ways, all pay stubs generally include the same information. 

You may receive your paystub in a physical format, or digitally through a service such as www.paystubs.com.

Gross Pay 

The number that your eye will immediately go to is probably this amount. Your gross pay is what number you were probably offered when you took the job. It's your total salary divided by pay period. Or, if you work freelance, it's likely the full advertised payment for your job. 

This number is actually a bit larger than the money that will actually go into your account. It's your pay before taxes and withheld wages. 

Federal and State Taxes Withheld 

As you're likely familiar with, some of your paycheck goes into the pockets of the federal government. How much you pay in federal taxes is dependent on what tax bracket you're in. The higher you earn, the more of a percentage you contribute.

State taxes work the same way but have a different tax rate than the federal. Your specific rate will vary depending on where you reside. 

You'll see how much was taken out for each kind of tax listed on your paystub. If you're in a large metropolitan area such as New York City, you'll also see taxes taken out on the local level. 

Contributions or Deductions

You likely receive a number of benefits through your employer. They're probably your path to Medicaid and Social Security as well. Your contributions to these benefits will be taken out of each of your paychecks.

Same goes for your retirement plan if it is set up through your employer. 

Net Pay 

The most important number on your pay stub is probably your net pay. This is the total amount you'll receive after all other deductions are done. This is the actual money you'll have in hand from this pay period. 

In addition to this pay period, your pay stub may keep track of monthly or yearly totals for you. 

Understanding Pay Stub Meaning

It can be frustrating to not understand where your work and money is going. Understanding a pay stub meaning can help ensure you're knowledgable and more in control of your financial situation. 

Have more questions about your job? Check out our blog for more helpful information.