Income refers to the money or benefits received in exchange for work, investments, or other sources. It plays a crucial role in determining an individual's financial stability and is typically categorized into several types.

Income is not just limited to salary or wages, it can also come from investments, side businesses, or government benefits.

  • Earned Income: Money received from working, either as a salary or hourly wages.
  • Investment Income: Earnings from stocks, bonds, and other financial investments.
  • Passive Income: Revenue generated with little to no active involvement, such as rental income or royalties.

The total amount of income earned can be affected by various factors like industry, location, and education level.

Income Type Description
Earned Income Wages or salary earned from active employment.
Investment Income Returns from financial assets like stocks or real estate.
Passive Income Ongoing earnings with minimal effort, like rent or royalties.