Paycheck
What is Net Pay?
The pay the employee receives or has deposited to their account
Erica’s employer offers to match her 401(k) contributions up to 4% of her pay. What should she do?
Try to contribute at least 4% of her pay to take advantage of the full employer match.
Which frequency of pay is best for managing your cash flow?
Weekly
Set up payments in advance in order to avoid late fees
What is a "retention bonus"?
A payment designed to prevent an employee from leaving an organization
What is Gross Pay?
the amount of pay before any deductions or taxes are taken out
Which is not a common type of paid time off (PTO)? (vacation days, sick days, paydays, holidays)
Paydays
Salaried employees can count on...
Predictable income
Juan earned $100,000 last year. Approximately how much was withheld for FICA?
$7,600
What pay frequency is the worst for employees? (difficult for managing cash flow)
Monthly Pay
What is an advantage of Direct Deposit for the employee?
Funds are available at the earliest possible date
What is the approximate percentage of an employee's total compensation that benefits make up? (8, 15, 30, 50)
30%
Which would most likely be a contracted hourly employee? (nurse, teacher, company/store manager, car salesman)
Nurse
In which situation would an employer be required to pay overtime? (hourly employee works 12hr shift, hourly employee works 48hrs/week, salaried employee works on a holiday, salaried employee works a Saturday)
hourly employee works 48hrs/week
What is another name for your paycheck/paycheck receipt? (has all the information from that pay period)
Paystub
What is a benefit of being paid commission?
Excellent performance = higher pay
In what way are employee benefits actually better than wages?(most are exempt from taxes, benefits value>wages, wages can be lowered/benefits can't, reimbursed for unused benefits)
Most benefits are exempt from federal and state taxes
What is a disadvantage of being a salaried employee?
Rarely paid for working more than 40 hours/week.
Who would most likely be paid salary plus commission? (dental assistant, mechanical engineer, salesperson, utility company electrician)
salesperson
______ ______ is a form of profit sharing. It allows employees to purchase company shares at a discounted price
Stock Options
Name a voluntary deduction from pay?
Health Savings Account, union dues, insurance, retirement
Which benefit typically costs employers the most to provide to their employees?
Health Insurance
What is a drawback of a job that pays a salary plus commission?
Earnings vary from pay period to pay period
When evaluating comparable job offers, which is the best guidance to follow? (Prioritize cash wages, hourly and commission is best, consider value of all benefits, incentive-based pay is best)
Consider the value of all benefits as well as potential incentive based pay
What form does an employee use to determine how much should be withheld from their pay for income taxes? (401K, FICA, W-4, HSA)
W-4