Understanding Your Pay Stub

The video tutorial explains how gross pay is reduced to net pay through various deductions, including taxes, insurance, and retirement savings. It uses Marta's pay stub as an example to illustrate these deductions and provides advice on reviewing pay stubs for accuracy. The tutorial emphasizes the importance of understanding pay stubs for financial planning.

What is a common reason for workers being unhappy with their pay stubs?

• Their pay stubs are always incorrect.

• They receive their pay stubs too frequently.

• Their net pay is much less than their gross pay.

• Their net pay is higher than their gross pay.

Which of the following is NOT a type of deduction that can reduce gross pay?

• Charitable contributions

• Overtime pay

• Union dues

• Insurance premiums

What is Marta's hourly rate as a production specialist?

• $30.45

• $35.45

• $20.45

• $25.45

How often is Marta paid?

• Annually

• Monthly

• Bi-weekly

• Weekly

What percentage of Marta's wages is diverted into a traditional 401k plan?

• 3%

• 5%

• 10%

• 7%

Which tax is NOT deducted from Marta's pay stub?

• Social Security tax

• Medicare tax

• Sales tax

• Federal income tax

What is the purpose of Marta's W-4 form?

• To apply for a new job

• To enroll in health insurance

• To request a pay raise

• To indicate her marital status and additional tax considerations

What is the total amount deducted from Marta's paycheck for her Roth 401k and United Way contribution?

• $63.94

• $10.00

• $73.94

• $53.94

Why is it important to review your pay stub regularly?

• To find errors in your gross pay

• To ensure accuracy and adequate tax withholding

• To compare your pay with your colleagues

• To request more deductions

What should you do if you find discrepancies in your pay stub?

• Ignore them

• Report them to your employer

• Wait until the end of the year

• Reduce your work hours