American dopers often mention their income. However, I’m not sure what they mean exactly. Is it normally the net income or the gross income? For instance, I understand that income tax is withdrawn from the paycheck in the USA. So, is it the income after or before tax? If they have an health plan provided by the company they work for, are the related payments deduced from the income usually mentionned?
Basically, when an american poster write “I make $30 000 a year”, is this the amount he can actually spend or something else?
By the way, is everybody (or mostly everybody) paid on a weekly basis, as I gather from various comments I’ve read here (over here, we’re normally paid on a monthly basis)?
I think it is usually the Gross income, as in what you might read in a job advert. Net income will be quite a lot lower of course.
It’s gross income, before tax and before deductions, but it doesn’t include some benefits such as health insurance or retirement accounts paid for by the employer. So it’s neither the total cost of the employee to the employer, nor the total benefits eceived by the employee from the employer.
Most folks are probably talking about gross income.
In my experience people paid by the hour get a weekly cheque, sallery people get a monthly cheque.
If asked about my annual income, I’ll usually answer in gross. I know what my boss pays me in salary, but I seldom stop to multiply my actual paycheck by twenty-four.
If asked about my monthly income or how much I get in each paycheck, I will usually answer with the net.
Pay schedules in the U.S. vary greatly, but as a general rule fall into two categories:
Managerial and professional jobs normally pay monthly, twice a month, or biweekly.
Those that they supervise, which is a huge range of types of jobs, usually get a weekly paycheck.
And I agree that most talk of income is gross income, before taxes and other pieces are taken out or benefits added in.
How does one speak of income elsewhere?
Canada is pretty similar to the US in terms of pay periods and employment vernaculr. I’ve never expressed my annual income in any other fashion except gross annual. I’ve worked a few jobs where pay was weekly, one that was twice monthly, and one that was monthly, but most of the jobs I’ve had have been bi-weekly.
Traditionally, salaried people get paid monthly, but in my experience, these days it’s more common for them to be paid semimonthly.
Hourly workers are also more likely to be paid biweekly than the traditional weekly.
Note that here, there is a slight but significant difference between “semimonthly” and “biweekly.” The former results in 24 paychecks a year; the latter results in 26.
My Indian relatives always speak of income in monthly, not annual terms. I don’t know whether they mean gross or net, though.
How much lower? What exactly would have to be deduced from the gross income to figure out the net income (over here, so much things are deduced : healthcare insurance, unemployment insurance, retirement payments, and whatnot that I doubt most people even know, let alone care about or mention their gross income. The income mentionned is normally the net income : before income tax, which is paid separately, but after all welfare expenses are deduced. Basically, it’s what people actually get at the end of each month, with which they still have to pay the income tax.).
Basically, when someone mentions how much he makes here, how can I figure out roughly what his net income is (after or before income tax, I suspect the definition of “net income” is probably different in the USA and France, given that taxes are withdrawn from the paycheck in the USA)? In this case this question was prompted by a thread about restaurant prices where posters began discussing whether or not one could live comfortably on a $ 20 000/ year income in some US city, and I would have liked to be able to translate this in “equivalent-french-income”, but it’s not the first time I wonder about it for similar reasons.
There are too many variables. States and cities often have an income tax in the US, and tax levels can also vary according to number of dependants. Some people will have money taken out of their income to put into a retirement account: should that be included? Others will be paying off student loans (which they presumably incurred in order to earn more money), so that part is not real disposable income.
Hey look!!! It’s Payday!
OK as an example… I just did the math on my paycheck. After taxes, retirement, insurance, dues, etc., I take home roughly 60% of my gross earnings.
To quote an old commercial “Who’s FICA? And what is he doing with all my money!?”
Managers get paid monthly in the US???
They must get pretty sizeable paycheques to be able to adequately budget for that…
Most people here in Australia get paid weekly or fortnightly.
Centrelink (Department of Social Welfare) pay fortnightly, so you can always pick Dole Day because the supermarkets and post offices and bottle shops are full of people on Centrelink payments buying their groceries, paying their bills, and buying alcohol/smokes.
I get paid weekly, but my fiancee gets paid fortnightly, which causes some interesting cashflow and budgetary situations…
I’d also like to emphasize, like somebody else said previously, that there’s a huge value for many salaried people of benefits that aren’t included in your pay either. Every year I get a letter about the “value of my benefits”, and according to them it comes to some $40,000 or something. I think they’re counting if I, say, got wastng cancer and died in that total, however.
A person making $50,000/year in Colorado might bring home around $3000 per month. A hundred variables of course, but this example figures a family of four (income tax rates vary depending on marriage and children), normal health insurance (also varies depending on how many are covered), Social Security and other taxes, but doesn’t include retirement investments.
Very rough numbers, don’t make any decisions based on this, YMMV, all the other disclaimers.
The OP is in France, yes?
For comparison - an average used home of ~2000 sq feet with a one car garage in the suburbs of Denver runs about $220,000 (smaller can be found for $150,000). An economical car is about $20,000. Gasoline is $3 per gallon.
My company pays on the 15th and last day of the month. Government around here pays on the last day of the month.
Typically, the following is pre-deducted from the paycheck:
- Federal income tax
- State income tax
- Medicare tax
- Social Security tax
There are several voluntary deductions, but these ar the usual mandatory ones.
I generally estimate that these items add up to about 30-40 percent of gross pay.
Weird. I have held a million crappy jobs, and got paid biweekly every time.
In my company, “exempt employees” (i.e., professionals and managers) get paid monthly. Back in Australia, people in similar jobs do indeed get paid fortnightly.
(And the word “fortnightly” is not used here either: they say “biweekly”, which seems terribly ambiguous to me: does that mean 26 times or 104 times each year?)
I think that would be very unusual. Most comapnies pay twice monthly.
(Gross pay vs net)
A rule of thumb, back of the napkin guesstimate is 40% comes out of a paycheck to go to taxes and whatnot like union dues or health insurance. Looks like the average tax this year was 31.6%