Money received, especially on a regular basis, for work or through investments
Income can come from a variety of places:
Hourly Wage
Salary
Commission
gratuities
Profits from investments or businesses
Interest Earned from savings and investments
Hourly Wage
An amount of money paid per hour of work. The rate at which someone is paid is expressed as dollars per hour. In Ontario there is a minimum hourly wage of $14 per hour. Someone working an 8 hour day at the minimum wage would make $112 dollars a day.
Salary
A salary is a fixed amount of money paid to an employee. A salary will remain the same no matter the hours worked by the employee, although most jobs have a requirement for a certain amount of time spent in the office.
Commission
A compensation to an employee on behalf of the company based on the revenue they generated. There are a variety of different commission structures, some rewards are fixed and others are a percentage of the revenue generated.
Gratuities
A sum of money given on top of the services rendered. Gratuities are very common in service industry jobs. In Ontario a liquor server (waiters, bartenders, concessions workers at stadiums) makes less than the minimum wage ($12.45 per hour) because it is expected that they will make up for more than the difference in gratuities.
Profits From Investments or Businesses
These could be profits from stock or currency investments. If you buy a certain stock or currency and its value increases you will make a profit when you sell that stock or currency. Unfortunately, stocks and currencies can also decrease in value. If a stock or currency you are holding is worth less than it was when you bought it, you will lose money. This is why it's important to diversify your financial portfolio, to mitigate the risk.
Investing in a business is another way that you could get some returns. If the business succeeds you can share in its profits.
Interest Earned From Savings and Investments
The interest that you earn on your savings account is also a form of income. Gathering interest on your savings requires very little effort and has very little to no risk because your growth is not dependent on outside factors like the success of a business business or a bullish stock market (a stock market that generally goes up).
Gross Income vs Net Income?
Gross Income
An individual’s total earnings from pay and/or other sources, before taxes or other deductions
Net Income
An individual’s total earnings from pay and/or other sources, minus income taxes or other deductions