Lesson 2 · About 7 minutes
Know What Comes In
A useful plan begins with what may actually be available. Income can arrive from work, benefits, self-employment, seasonal activities, an Individual Indian Money account, or other sources. Some resources are regular; others change.
Take-home income is the amount you receive
Gross pay is the amount before taxes and deductions. Take-home pay is what reaches you after those amounts are removed. For an everyday plan, take-home pay is usually the more useful number.
Build a complete income picture
Paychecks, benefits, or other resources that usually arrive on a known schedule.
Hours, tips, contract work, or support that may be different each month.
Tax refunds, harvest or seasonal work, distributions, gifts, or other resources that do not arrive monthly.
When income changes
Use a careful estimate rather than the highest possible amount. You might begin with a lower recent month, then decide how any additional income will be used if it arrives. An estimate is allowed to change when new information comes in.