Presentation is loading. Please wait.

# 2.13.1.G1 © Family Economics & Financial Education – February 2006– Get Ready to Take Charge of Your Finances – Planet Paycheck – Slide 1 Funded by a grant.

## Presentation on theme: "2.13.1.G1 © Family Economics & Financial Education – February 2006– Get Ready to Take Charge of Your Finances – Planet Paycheck – Slide 1 Funded by a grant."— Presentation transcript:

2.13.1.G1 © Family Economics & Financial Education – February 2006– Get Ready to Take Charge of Your Finances – Planet Paycheck – Slide 1 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona An employee starting a new job has the option to choose how he is paid for the first twenty days of work. He works five days a week, for four full weeks. Make the best choice for the new employee after comparing the two options. Double the Salary Payment Option 2: The pay will be \$0.01 for the first day. Each day the pay will double. So, it will be \$0.02 the second day, \$0.04 the third day, \$0.08 the fourth day, etc. By the end of twenty days, how much money will the employee have made? Payment Option 1: For the first twenty days of work, the new employee will be paid \$500 a day.

2.13.1.G1 © Family Economics & Financial Education – February 2006– Get Ready to Take Charge of Your Finances – Planet Paycheck – Slide 2 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona Double the Salary Payment Option 2: Day 1\$ 0.01Day 1110.24 Day 2.02Day 1220.48 Day 3.04Day 1340.96 Day 4.08Day 1481.92 Day 5.16Day 15163.84 Day 6.32Day 16327.68 Day 7.64Day 17655.36 Day 81.28Day 181310.72 Day 92.56Day 192621.44 Day 105.12Day 205242.88 Total:\$10,485.75 Payment Option 1: \$500.00 a day * 20 days = \$10,000

2.13.1.G1 © Family Economics & Financial Education – February 2006– Get Ready to Take Charge of Your Finances – Planet Paycheck – Slide 3 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona Solution Payment Option 1: \$500.00 a day * 20 days = \$10,000.00 Payment Option 2: This is a better choice for the new employee as he will be making \$10,485.75 This is \$485.75 more than if he would have chosen Payment Option 1

2.13.1.G1 © Family Economics & Financial Education – February 2006– Get Ready to Take Charge of Your Finances – Planet Paycheck – Slide 4 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona An Earthlings Guide to Understanding Paychecks Family Economics & Financial Education Planet Paycheck

2.13.1.G1 © Family Economics & Financial Education – February 2006– Get Ready to Take Charge of Your Finances – Planet Paycheck – Slide 5 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona Planet Paycheck Navigation Welcome to Planet Paycheck! While visiting Planet Paycheck the vast world of paychecks will be explored!

2.13.1.G1 © Family Economics & Financial Education – February 2006– Get Ready to Take Charge of Your Finances – Planet Paycheck – Slide 6 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona First Job! Miss Patty Paycheck has just received her first paycheck from her new job! –But, the paycheck amount seems a little lower than she had figured. How could that be? Taxes – Required charges of citizens by local, state, and federal governments –Taxes are deducted from all employees paychecks – Used to provide public goods and services Roads, police, schools, governmental agencies, fire and emergency services

2.13.1.G1 © Family Economics & Financial Education – February 2006– Get Ready to Take Charge of Your Finances – Planet Paycheck – Slide 7 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona Starting a New Job To receive a paycheck, an employee must: Complete a Form W-4 Employee’s Withholding Allowance Certificate Determines the amount of money withheld for taxes

2.13.1.G1 © Family Economics & Financial Education – February 2006– Get Ready to Take Charge of Your Finances – Planet Paycheck – Slide 8 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona Starting a New Job Complete a Form I-9 Used to prove the identity of people and avoid hiring non United States citizens Must provide at least 2 of the following –passport –driver’s license –U.S. military card –Social Security card –birth certificate

2.13.1.G1 © Family Economics & Financial Education – February 2006– Get Ready to Take Charge of Your Finances – Planet Paycheck – Slide 9 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona Starting A New Job Form W-2 (Wage and Tax Statement) States the amount of money earned and taxes paid throughout the previous year Used to file income taxes by April 15 th Individuals may be exempt from filing federal withholdings if they make less than a certain amount per year

2.13.1.G1 © Family Economics & Financial Education – February 2006– Get Ready to Take Charge of Your Finances – Planet Paycheck – Slide 10 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona Methods for Paying Employees 1.Paycheck Paper check with stub Least secure payment method because the employee is responsible for handling the paycheck 2. Direct Deposit Employers directly deposit employee’s paycheck into the authorized employee’s bank account 3.Payroll Card A payroll card electronically carries the balance of the employee’s net pay

2.13.1.G1 © Family Economics & Financial Education – February 2006– Get Ready to Take Charge of Your Finances – Planet Paycheck – Slide 11 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona Payment Method Pros and Cons Paycheck –Pros: Employee controls when the check is deposited –Cons: Least secure, employee responsible for getting it to the bank Direct Deposit –Pros: No direct handling of check Employee knows exactly when he/she will be paid Payroll card –Pros: Wages automatically loaded onto a card –Cons May charge fees for use of the card

2.13.1.G1 © Family Economics & Financial Education – February 2006– Get Ready to Take Charge of Your Finances – Planet Paycheck – Slide 12 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona Reading A Paycheck Stub Items on a paycheck stub include: Personal Information -The employee’s full name, address, and social security number or employee identification number Pay Period -The length of time for which an employee’s wages are calculated –Most businesses pay employees either weekly, bi-weekly, or monthly

2.13.1.G1 © Family Economics & Financial Education – February 2006– Get Ready to Take Charge of Your Finances – Planet Paycheck – Slide 13 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona Reading A Paycheck Stub Gross Pay – The total amount of money earned before payroll withholdings If a person earns an hourly wage, gross pay is calculated by multiplying the number of hours worked by the wage

2.13.1.G1 © Family Economics & Financial Education – February 2006– Get Ready to Take Charge of Your Finances – Planet Paycheck – Slide 14 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona What is the Gross Pay? If Miss Patty Paycheck worked at Terrific Tacos for \$6.00/hour for 15 hours a week what will her gross pay be? What is Miss Patty Paycheck’s gross pay for a two week pay period? 15 hours x \$6.00/hr = \$90.00/week # hours worked x wage = gross pay 30 hours x \$6.00/hr = \$180.00 for 2 weeks

2.13.1.G1 © Family Economics & Financial Education – February 2006– Get Ready to Take Charge of Your Finances – Planet Paycheck – Slide 15 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona Reading A Paycheck Stub Payroll Withholdings – The amount of money subtracted from the gross pay for taxes. Typically about 30% of your paycheck! –Withholding Tax – The amount required by law for employers to withhold from earned wages to pay taxes –FICA-Federal Insurance Contribution Act Fed OASDI/EE (Federal Old Age Survivors Disability Insurance Employee Employment Tax) or Social Security - helps provide retirement income for the elderly and pays disability benefits Fed MED/EE (Federal Medicare Employee Employment Tax) or Medicare - health care program for the elderly and disabled

2.13.1.G1 © Family Economics & Financial Education – February 2006– Get Ready to Take Charge of Your Finances – Planet Paycheck – Slide 16 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona Reading A Paycheck Stub Net Pay – The amount left after all payroll deductions have been taken from the gross pay –Net pay is also referred to as “take home” pay

2.13.1.G1 © Family Economics & Financial Education – February 2006– Get Ready to Take Charge of Your Finances – Planet Paycheck – Slide 17 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona Miss Patty Paycheck’s Paycheck Stub Miss Patty Paycheck’s paycheck includes: –Gross Pay \$180.00 –Payroll Withholdings: Federal Withholding Tax \$14.10 State Withholding Tax \$5.45 FICA \$13.77 What is her Net Pay? Gross Pay – Payroll Withholdings = Net Pay \$180.00 – (\$14.10 + \$5.45 + \$13.77) = \$146.68

2.13.1.G1 © Family Economics & Financial Education – February 2006– Get Ready to Take Charge of Your Finances – Planet Paycheck – Slide 18 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona Reading A Paycheck Stub Year-to-Date- Totals all of the deductions which have been withheld from an individual’s paycheck from January 1 to the last day of the pay period indicated on the paycheck stub

2.13.1.G1 © Family Economics & Financial Education – February 2006– Get Ready to Take Charge of Your Finances – Planet Paycheck – Slide 19 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona Sample Paycheck Stub Terrific Tacos Employee Paycheck, Patty SSN/Employee Identification Number 201-92-4856 Check # 164 Check Amount (net pay) \$146.68 Employee Address 293 Michael Grove Billings, MT 59102 Pay Type- Gross Pay DeductionsCurrentYear-to-date \$180.00Federal Withholding State Withholding FICA \$14.10 \$5.45 \$13.77 \$296.10 \$130.80 \$330.48 Totals\$33.32\$757.38 Pay Period 6/11/2007-6/25/2007

2.13.1.G1 © Family Economics & Financial Education – February 2006– Get Ready to Take Charge of Your Finances – Planet Paycheck – Slide 20 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona Remember to Review It is important to review each paycheck stub to identify any possible mistakes! –If a mistake is found, contact the employer for clarification

2.13.1.G1 © Family Economics & Financial Education – February 2006– Get Ready to Take Charge of Your Finances – Planet Paycheck – Slide 21 Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona Thanks for Visiting Thank you for visiting planet paycheck. Good luck with all of your future paycheck journeys!

Download ppt "2.13.1.G1 © Family Economics & Financial Education – February 2006– Get Ready to Take Charge of Your Finances – Planet Paycheck – Slide 1 Funded by a grant."

Similar presentations

Ads by Google