Reading a pay stub, line by line Reading a pay stub, line by line Unit 2 — Getting paid Unit 2 — Getting paid Reading a pay stub, line by line Reading a pay stub, line by line Your first pay stub will be smaller than you expected. Knowing exactly why is the difference between feeling cheated and being able to check the math. Your first pay stub will be smaller than you expected. Knowing exactly why is the difference between feeling cheated and being able to check the math. Lesson 3 of 8 — about 14 minutes — CareerStart.ai Financial Literacy Lesson 3 of 8 — about 14 minutes — CareerStart.ai Financial Literacy What you will be able to do What you will be able to do What you will be able to do What you will be able to do By the end of this lesson By the end of this lesson 1 Identify gross pay, deductions, and net pay Identify gross pay, deductions, and net pay 2 Explain what FICA funds Explain what FICA funds 3 Verify that hours and rate are correct Verify that hours and rate are correct Gross is what you earned; net is what you get Gross is what you earned; net is what you get Unit 2 — Getting paid Unit 2 — Getting paid Gross is what you earned; net is what you get Gross is what you earned; net is what you get Gross pay is hours times rate, plus any overtime. Net pay is what lands in your account. Everything between them is a deduction, and each one has a name and a reason. Gross pay is hours times rate, plus any overtime. Net pay is what lands in your account. Everything between them is a deduction, and each one has a name and a reason. Federal income tax is based on the W-4 you filled out on day one. FICA is two fixed items: Social Security at 6.2% and Medicare at 1.45%. These are not optional and not adjustable. State income tax applies in most states, and in Kentucky many cities and counties also withhold a local occupational tax on top of that. Federal income tax is based on the W-4 you filled out on day one. FICA is two fixed items: Social Security at 6.2% and Medicare at 1.45%. These are not optional and not adjustable. State income tax applies in most states, and in Kentucky many cities and counties also withhold a local occupational tax on top of that. Check it — payroll makes mistakes Check it — payroll makes mistakes Unit 2 — Getting paid Unit 2 — Getting paid Check it — payroll makes mistakes Check it — payroll makes mistakes The most common errors are simple: hours short by a shift, the wrong pay rate after a raise, or overtime paid at straight time. All of them get corrected when you point them out promptly, and all of them are much harder to fix three months later. The most common errors are simple: hours short by a shift, the wrong pay rate after a raise, or overtime paid at straight time. All of them get corrected when you point them out promptly, and all of them are much harder to fix three months later. The YTD column shows your running total for the year. It is the number you will need at tax time, and it is worth glancing at each period to make sure it is climbing the way you expect. The YTD column shows your running total for the year. It is the number you will need at tax time, and it is worth glancing at each period to make sure it is climbing the way you expect. Key term: FICA Key term: FICA Key term Key term FICA FICA Federal Insurance Contributions Act — the payroll tax funding Social Security and Medicare. Employees pay 6.2% and 1.45% respectively, and employers match both. It is separate from income tax and cannot be adjusted on your W-4. Federal Insurance Contributions Act — the payroll tax funding Social Security and Medicare. Employees pay 6.2% and 1.45% respectively, and employers match both. It is separate from income tax and cannot be adjusted on your W-4. Two weeks at 34 hours, $13.00 an hour Two weeks at 34 hours, $13.00 an hour Activity Activity Two weeks at 34 hours, $13.00 an hour Two weeks at 34 hours, $13.00 an hour RIVERSIDE RETAIL LLC · pay period 03/01 to 03/14 · check #4471 RIVERSIDE RETAIL LLC · pay period 03/01 to 03/14 · check #4471 68 hrs @ $13.00 $884.00 Federal income tax −$62.80 Social Security 6.2% −$54.81 Medicare 1.45% −$12.82 KY income tax −$35.36 Boyd Co. occupational −$8.84 Net pay $709.37 $884 gross became $709. That gap is about 20%, which is typical — and it is why budgeting from your gross wage always comes up short. $884 gross became $709. That gap is about 20%, which is typical — and it is why budgeting from your gross wage always comes up short. Open any line → Why it matters at work Why it matters at work Why it matters at work Why it matters at work Keep your first three pay stubs. If a dispute ever comes up about your rate or your start date, they are the record. Keep your first three pay stubs. If a dispute ever comes up about your rate or your start date, they are the record. ← Previous Mark complete Next: The W-4, withholding, and your refund →
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