Income - How to Calculate What you Earn or What you Should Earn

Income is money or other financial benefits that you receive in exchange for providing goods or services, or as a return on investments. Examples: wages, salaries, tips, bonuses, commissions, rental income, interest, dividends, capital gains, and other sources.

General outline of how income is typically calculated:

1. Gather Financial Documents: such as tax returns, pay stubs, bank statements, and any other relevant financial records to establish all sources of regular income  
2. Determine Gross Income: the total income before any deductions or taxes, including wages, salaries, bonuses, commissions, rental income, investment income, and any other sources of income
3. Adjust for Deductions: deductions from gross income, such as taxes, health insurance premiums, and retirement contributions
4. Calculate Net Income: gross income less all deductions
5. Consider Imputed Income: presumed income if underemployed or unemployed

Some calculations rely on gross income and others focus on the actual income available to each of you monthly (net income)