Net pay is the actual salary employees receive after all deductions are applied to their gross earnings. Deductions include taxes, insurance premiums, and retirement contributions, which reduce the total earnings to the amount deposited in employees’ accounts. Knowing net pay helps employees plan expenses, savings, and investments effectively. Employers must ensure precise calculations to maintain transparency and avoid payroll discrepancies. Comparing gross and net pay also allows employees to understand how benefits and deductions affect their income. Accurate knowledge of net pay is essential for both financial stability and informed decision-making regarding personal budgets and employment choices.