Take-home pay consists of the income an individual receives after taxes, benefits, and other contributions are deducted. Take-home pay may also be called net pay. Understanding the difference between salary and take home pay is important for anyone trying to create and live on a household budget.

What Is My Take Home Pay Calculator?

Using the payroll tax calculator from Money Help Center helps you understand what your taxes and income are after pretax benefits have been withdrawn. The reality is when you get your paycheck, you may notice you are not getting the hourly wage listed in your employee agreement. This is because, in addition to tax withdrawals mandated by the government, your employer may also be withdrawing money for pretax benefits, such as your retirement plan, dental or vision coverage and more. Understanding what is being withdrawn and how much you are taking home is important for a few reasons:

  • It allows you to make smarter choices about benefits. While benefits are important to protect you in case of medical expenses or other emergencies, if you are having trouble covering your living costs because of how much is withdrawn from your pay, you might want to meet with HR to find ways to adjust your benefits. Carefully consider the benefits you want and evaluate whether they meet your needs and offer adequate coverage. Be sure to read the details of each benefit. Pay special attention to any benefits you may not use or any benefits that overlap.