Earning an Income

Income Income is money which is exchanged for a productive resource. Most people use their labour to receive income. There are two main sources of income: Private Public

Private Sources of Income Wages Paid weekly based on a fixed number of hours worked according to an award. Any extra hours worked will be paid at overtime penalty rates, a higher rate of pay per hour.

Private Sources of Income Salary Calculated on a yearly basis but are generally paid fortnightly or monthly. Generally paid to those in professional or managerial positions for a set job description rather than a fixed number of hours.

What do you think the difference is between a full-time, part-time and casual employee is? Why do you think award rates exist? What do you think you could do to get more than the award rate? Why would an employer decide to pay you more than the award rate?

Private Sources of Income Commission Earned by acting on behalf of someone else. Eg. Real estate sales people. Total depends on the value of sales made.

Are all employees equally valuable? What impacts on their value? What could you do to add value to a job you have?

Private Sources of Income Royalties Paid to people who come up with original ideas such as musicians when others use it for profit.

Private Sources of Income Rent Earned when you lease out property you own to other people.

Private Sources of Income Profit Earn profits by owning a business which is shared among the owners. Profit is divided among owners (shareholders) via a dividend.

Private Sources of Income Interest Interest is earned when you lend money to another individual or organisation. The amount of interest paid will reflect the degree of risk involved. The higher the risk, the higher the interest rate earned.

Activity Search for the Business Review Weekly (BRW) Rich List for Prepare a list of the top ten earners, their wealth and businesses. Choose one individual and research how they made their fortunes. Summarise your findings.

Government Sources of Income Money is distributed in the form of pensions and allowances by the government from funds raised from taxes to ensure people have a basic standard of living.

Activity Visit the Department of Human Services website and the Study Assist website and search to complete the following table. Newstart Allowance Youth Allowance HECS-HELP What is it? Who is eligible to receive it? How much is it?