It is important for an employee to know the amount of money to be deducted from their salary. The amount of money deducted has different uses. In this article we shall look at different ways in which the money is put to use.
one of the important uses of the money is to cover for health insurance. This applies if an employer provides health insurance for the employee. an employer should provide their employees with health insurance. The money is deducted annually or monthly from the employees’ payroll. Therefore in case of an emergency, the employee does not have to pay cash at a health center. They only have to use the health insurance.
Another payroll deduction is short-term and long-term disability. This insurance ensures that in case the employee is rendered disable whether permanently or temporarily they are able to get a small amount of fee. In case employees end up in this situation they can steal fend for themselves with this insurance coverage.
Life insurance is another deduction. Basic life insurance is offered to employees in most areas of work. It is important for an employee to have this insurance in case of their demise. The dependents can therefore financially continue with their livelihood after the death. The plan offered does not last for a long period of time because it is just a basic premium plan.
Supplemental life insurance is also created by the payroll deductions. This is in case the employee does not feel satisfied by the life insurance plan offered by the employer period an employee. Employees can decide to add any amount of money from their paychecks to get a for this insurance. Supplemental life insurance increase the time frame of the original life insurance.
Dependent life insurance is also deducted in the payroll. The insurance provides financial security in case one loses their child their spouse or dependent. This type of insurance guarantees the family of the specified people financial security in case they pass away. In case the employee was the breadwinner the insurance is convenient for the family.
Another deduction that is made from the payroll is accidental death and dismemberment.
Lastly one of the most important deductions is pension. This caters for the employee while they are retired and cannot work anymore. The money is paid to senior citizens so that they can find for themselves even without a salary. It is paid from the payroll deductions monthly or annually. Some employers pay a pension to the retired employees with interest.