5 Different Avenues You May Be Earning Your IncomeFeb 04, 2021
Many of us will have some form of understanding of our ongoing expenses. This includes regular household payments and other costs, like doing groceries. However, not many people understand their income. What we mean is that they do not do much research about their income, regarding the different ways they get income along with the taxes needed to pay.
If you want to learn more about the ways you earn an income so that you can maximise it, you are in the right place. Here are five different ways you may be earning your income:
1. Salary and Wages
If you have a job, the majority of your income will likely be from salary and wages. However, understand that these two words do not exactly mean the same. Wages refer to the money you get paid based on your work hours, level of performance, and more. On the other hand, salary is a fixed salary you earn despite how well you do. Which of these two terms applies to you will depend on your employer.
Another form of income you may have is through commissions. These are generally used to motivate people to work. For instance, you may be rewarded for completing a sale or reaching an objective, receiving extra cash as a result. Note that the commission will be mostly dependent on your performance and agreement with your employee.
Overtime typically happens when you have to work outside of regular office hours, usually asked by your employers to complete a certain task or project. Note that this does not include replacing a weekend day with a business day since you are still completing the same amount of hours and not doing extra. Employers will typically offer overtime pay, and at higher rates compared to regular hours. However, there must be a fixed agreement for this to happen first, so you cannot assume that you will get paid extra by working a bit more.
Bonuses are only given to employees who are given a salary, so you may not receive bonuses if you are getting paid by wages. Keep in mind that bonuses are set to reward you if you complete something important that is vital to the company’s operations. The bonus can come in any form, typically extra money tied to the salary you will receive later on.
Tips do not apply to everyone. However, if you are working in a specific industry, such as the food industry and are working as a waiter or waitress, you may receive a tip as extra pay. This is generally given to you as an expression of gratitude from a customer or client based on your service, and will typically go straight to you. However, how the tips are handled should be discussed with your employers, as this can be different with each case.
Now that you know the various ways you can gain income, you can maximise your income stream to add more to your savings or budgets. Remember that you must always be smart about your finances. It is not an infinite resource, and there may come a time where you may need money when you do not have much of it. Fortunately, there are other ways to secure money, such as payday loans! These loans are a great way to supercharge your income with extra cash, given that you can pay them off within a specific period.
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