It’s estimated that by the year 2020, 33 percent of the American workforce will be self-employed. Although this trend continues to grow, many institutions still rely on traditional paystubs for verification of employment income. Luckily, it’s easy and inexpensive to create your own paycheck stub using an online paycheck generator.
Here’s a look at some of the reasons you might need to create your own paycheck and how an online pay stub generator can save you time and money.
The Need for Traditional Pay Stubs
Most self-employed people don’t treat themselves as official employees of their business. They simply track their business income and expenses and spend what’s left over. While this is certainly easier, there are some major advantages to cutting yourself a regular paycheck.
#1. Improved Chances for Loan Approvals
There are a ton of ways to start a legit business, making it easy for just about anybody to try their hand at self-employment. Unfortunately, not all of these businesses succeed. That’s why lenders make you jump through extra hoops when applying for loans.
Producing official pay stubs created with a pay stub maker shows that your business is legitimate and that you receive a consistent income. This increases your chances for loan approval.
#2. Easier Tax Tracking
Withholding the required taxes from each paycheck makes it easier to stay on track. You won’t have to worry about calculating quarterly estimated taxes and won’t get caught short at the end of the year. If you’re incorporated, paying yourself as an employee may also create tax savings for your business.
#3. Simplify Your Retirement Savings
Contributing to a self-employed retirement plan like an Individual 401(k) is a great idea. To do this, however, you must pay yourself as an employee. Creating paystubs helps you track of the information you need to calculate your contribution limits.
Benefits of Using a Paycheck Generator
As a busy entrepreneur, you already have a million things to do. The last thing you want is more responsibility and extra expenses. Don’t worry, you won’t need an expensive bookkeeper or payroll company to start paying yourself as an employee.
A pay stub generator makes it easy to create your own paychecks. The cost is minimal, and the setup is quick and convenient.
Once you create a template, you simply plug in the numbers and the paycheck stub generator will do the calculations for you. This reduces the chance of error and creates a professional paystub you’ll be proud to present to anyone who requests it. Once you start making your own paystubs, you’ll wonder why you didn’t do it sooner.
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Now that you know about the advantages of using a paycheck generator, you’re on your way to making your company even more legit.
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