Is there any real reason to save your pay stubs? I can see saving copies of your W-2s and income tax returns, but is there any purpose in saving the stubs?
I’m doing some major housecleaning and have realized that I have all these little fluttery strips of paper lying around without knowing whether I should hold on to them or not.
If the employer is making deductions as part of a pension plan, saving the pay stubs might be a good idea. I’ve heard horror stories where pension plans were reorganized and retirees were told that they had to supply a complete history of deduction in order to keep recieving benefits. Of course, this might just be Urban Legend territory.
Given the cheapness of digital scanners and CD-Rs, it wouldn’t be too hard to archive all your paperwork in electronic form. Of course, once you commit to that, you have to be sure to keep ahead of the obselete media formats (Sooner or later, they’re going to stop making drives that read CD-R) and file types (Who knows if jpeg will be the default forever), but that shouldn’t be too hard.
I work for the gov’t. I read each pay stub carefully and keep them all because more than once I’ve discovered a discrepency or noted that I should have been receiving compensation or benefits that I was not receiving. You’d think they would be able to check their records but…I have found the three or four times I had to try and get my pay straightened out, you must confront them with documentation of the shortfall before they will do anything about it - even then, you are likely to be bounced around from dept to dept for months.
Maybe normal companies are more conscientious…
I’d save them for at least a year. Once I worked for someone who didn’t give us W-2’s. It was rumored he didn’t submit withholding tax, and was going to claim his employees were independent contractors. The stubs not only defended against any such claim, they also gave me the figures I needed to file my taxes–how much I had earned, how much had been withheld, etc. Without them, it would have been a hugely greater pain to deal with the situation.
I only keep mine for the current year as well. Once I have the W-2, I destroy the stubs. I hate the clutter of pay stubs and credit card receipts.
I save them and keep them with my tax data. In theory, the IRS can call for a complete audit of your tax return, and you’d be required to supply the pay stub to show the W2 was correct (the good news is that this type of audit is rare; the bad news is that people are chosen for it at random).