Cash Course: How Are You Getting Paid?

hey I heard you were offered a job that's great thanks is it hourly salary or commission based it's um what you know how you're being paid well I'm not sure actually you know that not all jobs are paid the same way right hourly wages tips salaries and commissions are just a few ways you can earn money in the 90 000 hours you may be working in a lifetime wow that's a lot of time and potentially a lot of jobs so let's learn about the various ways you can earn that money okay can you give me an example the first form of income is hourly which represents more than half of U.S workers including jobs and Retail construction and even order up even hot dog flipping which means I get paid every hour I work for example if your rate is 7.25 cents per hour the current federal minimum wage in 2023 and you work 40 hours a week your gross pay would be 290 dollars per week any time worked Beyond 40 hours is called overtime which is usually compensated at one and a half times the regular rate nice so if you work 45 hours you'll be paid 10.87 per hour for those additional five hours sometimes there's even holiday pay when you have to work on a holiday and it's typically double your hourly rate or more interesting what's another way tip income is when a person earns a large part of their income in the form of tips on top of their hourly wage the hourly rate for these jobs is usually much lower than the federal minimum wage but it's made up with tips which are paid directly from the customer to the person providing a good or service including taxi drivers Barbers and your hot dog special sir yup waiters enjoy there are no rules for tipping but most people give at least 15 to 20 percent of the total cost of their purchase because of this variation a person could sometimes make more on a tipped wage than if they were strictly on an hourly wage I've heard my parents talk about a salary what's that a salary is another very common way people are paid it's expressed as an annual amount like thirty thousand dollars per year a salaried employees pay per month is determined by taking the annual salary and dividing it by 12. although they don't get paid for every hour worked they're usually offered perks like paid vacation Leave paid holidays health insurance and retirement accounts nice any others certain workers earn a commission-based income it's a type of income based on a percentage of the value of goods or services sold this category includes Realtors sales reps and hot dogs get your hot dogs for sale sure sometimes even hot dog vendors that means the more product I sell the more money I make for example let's say you're a hot dog vendor who earns a 10 Commission on your total sales and one week you sold ten thousand dollars of product that means you earned one thousand dollars in commission there's potentially a lot of money you can make being commission based but you could also make much less than you'd like since your success at selling products can change suddenly due to all kinds of factors bummer fortunately some commission jobs offer a salary in addition to any commissioned income earned besides overtime pay employees often have opportunities to earn extra income for example you can earn extra money in the form of a bonus for achieving specific goals or a stipend for performing tasks beyond your regular job description plus many jobs offer other forms of compensation that have monetary value such as benefits like insurance premium assistance retirement match programs paid time off stock options that allow employees to buy shares of their company at a discounted rate and allowances that cover work-related expenses like food clothes travel or equipment your base wager salary plus any additional income like bonuses tips stipends or commissions and other forms of compensation like benefits and other allowances is called total compensation now that you know about various forms of income it's time to consider a few things before you accept that job offer one no matter how you choose to get paid consider how it will affect your budget and your cash flow different jobs have different considerations including hours benefits and possible earnings clearly understand how you will be paid and your total compensation two ask if there are ways you can earn income beyond your base pay lots of companies offer their employees ways to earn extra income for performing well and going Beyond what's required and three determine if your potential employer offers any other forms of compensation or perks the value of things like paid vacation leave health insurance benefits food and clothing allowances and stock options add up fast and can quickly beef up your total compensation understanding how your paid is just as important as how much you get paid having this knowledge will help you maximize your compensation for all of your hard work no problem Mr Otto I can totally sell that many hot dogs watch more at prageryoukids.com and parents don't 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